The Entrepreneurs Foundation of North Texas (EFNT) is a nonprofit organization that works with companies to help them integrate philanthropy into their business plan.  EFNT arranges and manages a contribution of equity (stock, options, or warrants) from companies and organizes volunteer activities for its employees.  EFNT was launched in 2000 by venture capitalists, entrepreneurs and professional services companies to support and encourage a culture of corporate community involvement.

At the center of EFNT is a consortium of companies that are giving back to the community using a unique model that is elegant in its simplicity and powerful in its impact.  By addressing the issues of limited time and money for companies, EFNT helps to generate new resources that benefit the community from good corporate citizens who anticipate “doing well while doing good.”

HOW IT WORKS

1. A company donates equity in the form of a stock option to EFNT (the average range of .25% - 1%).  At an early stage, these options, while invaluable to the founders, have nominal value in the marketplace and thus very little impact on the company’s income statement at the time of grant.
   
   
2. After a stock option grant is made, the donor company joins EFNT’s network of stakeholders including CEO’s of other option donor companies, equity investors, service providers, elected officials and community leaders.
   
   
3. Using EFNT resources and knowledge of the non-profit community, the option donor company explores organizations and causes it might like to support.  EFNT works with a company liaison to help organize volunteer activities for employees.
    
4. When the company experiences a liquidity event, EFNT exercises it’s options, capitalizing on the stock’s enhanced value.  It is at this time that the company realizes the tax benefits of the “spread value” between the modest valuation at the time of the original pledge and the fair market value at the time of exercise.  Additionally, this newly available funding goes to charities that the donor company chooses to support and for ongoing EFNT endeavors.