A donor advised fund (DAF) is a philanthropic vehicle where donors give assets to a sponsoring organization and then advise on grants or investments to be made with that capital. The donor receives a tax deduction for this contribution, and the capital is earmarked for investment towards the common good. DAF capital can be used for grants and investments in impact-first initiatives. A multi-donor DAF, like CCJF, pools capital from more than one individual DAF account.

A Just Transition is the process of shifting from an extractive, polluting economy to one that is sustainable, equitable, and community-centered. It focuses on building local economies that are regenerative and support the well-being of people and the planet. This approach prioritizes the leadership and needs of communities—especially Black, Indigenous, and People of Color (BIPOC)—who are most affected by social, economic, and environmental injustices. The goal is to create systems that promote economic self-determination, resilience, and justice for all.

You can read more about the Just Transition framework here.

Across the US, over $250 billion sits in DAF accounts waiting to be deployed—and that amount is growing each year. While sitting in a DAF account, the vast majority of this capital is not invested for impact, despite the fact that it is not constrained by market return obligations or “owned” by the donor. It’s sitting on the sidelines when it could be working for good.

DAF capital can and should play a vital role as catalytic, non-extractive capital because it can fill the investment gap for early stage social enterprises and funds. DAF money can provide patient, flexible, risk-tolerant, and concessionary capital for these social enterprises that are necessary to reach sustainable development goals.  

As Tim Freundlich, Founder & Executive Director of Strategic Development at Impact Assets says, “It’s time to leverage the intrinsic nature of donor advised funds to enable the billions in assets to be unleashed as catalytic capital even before being granted to nonprofits… to build the world that we want to see beyond the limited one Milton Friedman handed us.”

According to The Catalytic Capital Consortium, catalytic capital is “patient, risk-tolerant, concessionary, and flexible capital… to support impact driven enterprises and organizations that lack access to capital on suitable terms through the conventional marketplace… strengthening communities, expanding opportunity and economic growth, and fueling innovation.” 

Catalytic capital seeks to attract additional investors that otherwise wouldn’t join in, and to spawn innovation in structures that need early support. As a catalytic fund, we provide patient, risk-tolerant capital with terms that meet investees’ needs rather than prioritizing financial returns. 

To learn more, we recommend reading this article in the Stanford Social Innovation Review.

The founding members of the CCJF joined together because we were all having some version of the same experience—wanting to deploy our DAF capital in the most impactful way possible, but lacking a supportive peer network to learn, experiment, and invest collectively with. So far, we have found that the benefits of investing collectively are many, including: 

1. Magnifying each individual’s DAF investing power by bringing capital together to make a greater impact, overcome investment minimums, and support larger and more ambitious projects.

2. Fostering a culture of community, fun, experimentation, and thoughtful risk-taking.

3. Expanding our individual networks and building a broader community of like-minded DAF holders.

4. Providing a safe, inclusive, and confidence-building learning experience to grow and deploy capital together, alongside diverse perspectives from all over the United States.

Here is what our some of our members have to say:

“Doing this collaboratively is the best starting point for someone. I am a big proponent of no minimums... And, like anything in life, networks matter.”

“I joined mostly because I was looking for how to bring more people into a philanthropic space using theis idea. Any collective work is going to be more powerful than a single person.”

Anyone can join! No investment background is required. There are no minimums and there are various levels of involvement from being an investor to being on a steering or investment committee.