It’s widely recognized that entrepreneurs contribute enormous amounts of their time and energy towards building viable businesses. One lesser known fact, however, is that entrepreneurs are largely philanthropic, donating 50% more to charity than their non-business owner counterparts. What drives this philanthropic activity and what impact do entrepreneurs have on this sector of society?
There are three main reasons why entrepreneurs lead the pack in philanthropic contributions. According to a 2018 Fidelity Charitable Study…
- Philanthropy is a part of their DNA: In fact, 79% of entrepreneurs say that philanthropy is a critical component of their identity.
- Entrepreneurs are compelled to take action: When they encounter causes they believe in, entrepreneurs are motivated to roll up their sleeves and get their hands dirty.
- Entrepreneurs embrace their role as leaders: Compared to about 50% of non-business owners, 62% of entrepreneurs want to demonstrate leadership within their communities by volunteering relevant skills to causes that move them.
The impact of entrepreneur philanthropists
In the U.S. today, with nearly 30 million entrepreneurs and nearly half a million new entrepreneurs each month, entrepreneurs are a large segment of our population. Couple that with their desire to enact change through philanthropic activities and the social impact of this powerful population segment cannot be underestimated.
As a whole, entrepreneurs are motivated to give back to such a degree that it even drives their exit strategies when selling or passing down their businesses. 31% plan to allocate a portion of their sale proceeds to charity while almost one-third of business owners arrange ongoing donations to charitable causes through funds or foundations.
Do you want to contribute to the greater good by building a business that leaves behind a legacy? We recently had the privilege of co-authoring, LEGACY, a book devoted to the what, why and how of creating a business that truly matters.