Jack Dorsey gives $1B to fund global Covid-19 relief

Does this mean selling the shares now to get $1B cash or they keep the shares floating around and sell them as they need cash?

StartSmall was started in 2015, why does a five year old organization require flexibility in expediting setup?

From the same article, Jack also doesn’t seem to have a strong history of putting his money where his mouth is. (Offered to donate Square shares to Ferguson with no follow through.) I don’t blame the community for skepticism.

https://www.sfchronicle.com/business/article/Where-is-Jack-D...

My hesitation is how do you know where the money is really going? For example the $100k he gave to America's Food Fund, how do they prove only going to people affected by Covid19? Call me cynical and a skeptic, but I've personally witnessed people trying to benefit from programs and non-profits that don't need the assistance. There are shady and scammy individuals out there.

A devils advocate summary:

1. he is just changin one stock for another

2. second part of this "donation" is fuelling an openly sexist cause

3. third part goes toward something that is supposed to ease up the populace in the wake of growing wealth inequality, without really solving the issue

Let the downvotes roll in.

I think it’s surreal just seeing a 1B on a spreadsheet.

The concept of charity is arguably unethical, let alone noble.

It would be interesting to hear from the whiners what in their mind would make a rich person not human scum. Obviously making an effort to solve real problems that affect people falls short of the grade.

The answer is nothing. They hate them on principal because they don't like that someone else has more than they do and they are bitter that they can't find whatever they need in life. It's literally the stage of development that preschool tries to get people through.

There is nothing more obnoxious than someone who needs to use an attempt by someone else to do something positive to bolster their own self righteousness. Disgusting.

just so people don't get the wrong idea -- there are a LOT of leftists, such as myself, on twitter who have a problem with zuckerberg donating .0001% of his wealth, who ARE impressed by this. Giving away 28% of your wealth is nothing to sneeze at, even if in a just economy he shouldn't have that much wealth to control in the first place. On an individual level, I still think this is very commendable in a way that zuck's pathetic donation is not.

What is 1B going to do that the 2 point something trillion that the gov just spent can't?

Yeah, that seems strange. If your motive is really to provide relief for people and not focus on getting profits, why would you do that with an entity that is used for profit motives? I'm not from or in the US, so might misunderstand what a LLC is, but could someone provide some reasoning why you would want to do this with a LLC instead of non-profit?

Edit: thanks y'all for your answers, I didn't think to check the rest of his Twitter timeline to see if he already answered that question.

Zuck used an LLC also, apparently for more control. [1]

One big reason is that he can time the actual donations, for tax purposes. That allows him to make big donations in years where he has large amounts of taxable gains to offset. If he donated $1B this year, he'd likely hit a deductibility cap (especially if he donated to a private foundation, as opposed to a generic 501(c)(3)).

https://www.nytimes.com/2015/12/03/technology/zuckerbergs-ph...

IANAL but I’m unaware of a legal entity that ensures non profit. Usually that’s just a tax assessment of 501c3 status. But charities themselves are corporations typically.

Why is that?

CashApp is still quite useful. Although with people indoors there may be a decline of its usage in that there will be no reason to transfer money between people.

It’s already 42% off its 2020 high, not saying it won’t fall further but it’s not like investors aren’t aware that Square revenues are gonna take a big hit.

I'm not an expert in this, but maybe the LLC is easier to setup and since it doesn't have fundraising, the money isn't taxable so it doesn't need to be a 403b.

In other words, its more like a trust than a non-profit. To expand, non-profits are created to raise money for a cause, not just give it away.

403b is a tax shelter, similar to a 401K... LLC is a corporate structure, more in line with C-corp.

Maybe you meant 501c?

There are a lot of articles out there arguing that non-profits are pretty heavily restricted and to make strong change you need a for-profit company, probably related to the rise of "Impact Investing"

I believe the only difference would be whether income is taxable or not. If there is no intended income for this fund -- that is, it's completely prefunded by the founder -- then there's no advantage to jump through the hoops that are necessary to get 403b status. That status is not freely handed out to everyone who walks up and claims their a non-profit. There's quite a bit of work that goes into it.

An LLC can be a non-profit now, so long as it elects to be taxed as a corporation for federal income tax purposes.

Based on the very brief description provided, it appears to have a charitable intent but it's not clear if it will be a true standalone charity or a private foundation.

Assuming you mean 501c and not 403b (a type of retirement plan), it's because you need to have the IRS approve your 501c status before you can advertise as one. They also have a large number of restrictions.

Also, he commented:

> Why is #startsmall a LLC? This segments and dedicates my shares to these causes, and provides flexibility. Grants will be made from Start Small Foundation or the LLC directly based on the beneficiary org. All transfers, sales, and grants will be made public in tracking sheet.

This is an inconvenient fact because most HNers tend to be wealthy or upper-middle class, first-world and myopic to their limited filter bubbles... and so utopian anarcho-capitalism and Austrian school economics seems meritocratic, functional, justified and superior to everything else.

I honestly can not even parse out what the general direction of your argument is here.

Let’s not pretend they did anything as difficult as printing that much money. They just added 2 trillion to a value in a database somewhere.

I think it does start to. Maybe it doesn’t entirely. But give the guy credit and let’s see where he goes with this.