How To Unlock Mission-Driven Investing With Your Donations

Turning Donations Into Impact Investments That Do More

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Billions of dollars intended for good are stuck in limbo, rather than flowing toward mission-driven investing. Donor-advised funds (DAFs)—charitable vehicles where donors receive an immediate tax deduction but can decide later where the money goes—hold more than $250 billion in assets. Yet most of this capital sits in traditional stock and bond portfolios rather than supporting entrepreneurs who are tackling climate change, healthcare inequities, and other pressing social problems. This represents a massive missed opportunity.

With global annual charitable giving exceeding $2.3 trillion, philanthropic capital could be a game-changer for impact-driven ventures—if deployed strategically.

The good news: A growing number of donors, investors, and innovators are discovering how to leverage donations to accelerate mission-driven investing, supporting both nonprofit causes and the next generation of founders tackling society’s biggest challenges.

Turning Donations Into Engines For Mission-Driven Investing

DAFs were designed to give donors flexibility. Money goes in, the donor gets a tax deduction, and, eventually, the money must be distributed to a 501(c)(3). But as long as it sits there, it can grow. Traditionally, that growth came from mutual funds, index funds, or even Fortune 500 stocks. What many donors don’t realize is that those charitable dollars can also be deployed into impact investments to fund entrepreneurs aligned with their values.

“There are hundreds of billions of dollars sitting in donor-advised funds that are just sitting there waiting to be given to a 501(c)(3),” says Marcia Dawood, venture investor and member of the SEC Small Business Capital Formation Advisory Committee. “If we put that money to work for the types of privately held companies aligned with our values, that’s where that tie-in happens.”

Lowering Barriers To Mission-Driven Investments

The perception that investing through donations requires writing a six-figure check is outdated. CataCap, for instance, has brought the minimum down dramatically. “All they have to do is just a quick donation of $500, $5,000, $500,000—whatever it is—just make one donation to our nonprofit, and we will allocate the investments,” Ken Kurtzig, co-founder of the impact platform, CataCap, explains.

That innovation is critical for democratizing access. By pooling smaller donations into larger aggregated checks, platforms like CataCap can back funds and startups that otherwise would be out of reach for individual donors.

Catalyzing Investment In Climate, Healthcare, And More

Turning Donations Into Climate Impact

From wildfires to extreme flooding, the costs of climate change are rising. Donors increasingly want to see their philanthropic capital directed toward solutions—whether renewable energy, sustainable agriculture, or climate-tech startups. Instead of waiting years to write checks to disaster relief nonprofits, DAF dollars can now flow to entrepreneurs building preventative technologies that address climate risks before they spiral.

One example highlighted by Kurtzig is innovators developing predictive tools for wildfire prevention. Donors can channel funds into such ventures through DAF-enabled platforms, multiplying their impact: Today’s donations seed tomorrow’s market-ready solutions.

Healthcare Entrepreneurship With A Personal Connection

Investing in women’s health ensures that women don’t die in poorer health than men as they do now.

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Healthcare is another area where donors see immediate relevance. Sophia Yen, founder of Pandia Health, has raised money on CataCap to expand access to birth control and menopause treatment. They’ve raised over $160,000 on the platform, underscoring how DAF dollars can directly support healthcare entrepreneurship.

“We chose Catacap because it opens up investment to anyone who wants to invest in a tax-deductible manner and for as low as $250,” Sophia Yen, MD, MPH, cofounder and CEO at Pandia Health. “Catacap allows smaller investors to help women founded and led companies and other companies that are doing good to get investments from smaller investors, our customers, and those new to investing.”

The attraction is twofold: Healthcare, especially women’s healthcare, resonates personally with many donors, and it is a sector notoriously underfunded by traditional venture capital. Leveraging donations to invest in healthcare startups means more resources for founders solving issues like access to contraception, maternal health, or menopause care.

Women and Founders Of Color: Closing Capital Gaps With Donations

A Structural Funding Gap That You Can Change

Investing in women founders drives stronger returns, unlocks overlooked markets, and fuels innovation by backing leaders who are historically underfunded yet deliver outsized impact.

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Raising capital is a steep challenge for women and entrepreneurs of color. Despite progress, these groups still receive only a sliver of traditional venture funding. Redirecting donor-advised funds and philanthropic giving offers a way to close that gap.

Empower Her, a community group hosted on CataCap, pools contributions to invest exclusively in women-led companies. “So far, they’ve raised just over $400,000. They’ve made four investments into four amazing women ventures,” Kurtzig says.

How Women Invest is a VC firm dedicated to investing in high-potential, women-founded companies—seeking out innovations in human and environmental health while delivering standout financial returns. Through CataCap, this initiative taps into mission-driven donations, enabling donors to align philanthropic capital directly with venture investments that support women entrepreneurs and drive real-world impact.

By lowering barriers and creating collective investment vehicles, such efforts help build patient, values-aligned capital pipelines for underestimated founders who might otherwise be overlooked.

Philanthropic Giving Meets Entrepreneurship

The appeal isn’t just altruistic. Donors are recognizing that supporting women and people of color is a form of mission-driven investing that produces double impact: immediate resources for businesses tackling social problems, plus long-term growth of charitable capital. When successful companies generate returns, the profits flow back into the DAF, ready to be redeployed for further grants or investments.

From Dormant Donation Dollars To Mission-Driven Change

The promise of mission-driven investing through donations is clear: tax-deductible contributions can do more than sit idle in Wall Street accounts. They can back entrepreneurs tackling climate change, advance healthcare solutions, and fuel innovation among women and entrepreneurs of color.

“The money does not ever go back to the donor,” Dawood explains. “But then I decide what happens with it from there. Maybe this is five years later, 10 years later, whatever it is, I decide if it’s going to go to a 501(c)(3) or I could keep evergreening the money into another private company.”

That flexibility makes DAFs uniquely powerful. Donors can support nonprofits over the long term while also channeling resources to startups addressing the world’s toughest problems. In a moment when capital gaps persist and urgent crises loom, unlocking even a fraction of the $250 billion sitting in donor-advised funds could reshape the landscape of mission-driven investing. The opportunity is here. The only question is whether donors will seize it.