Benzinga - by Benzinga Neuro, Benzinga Staff Writer.
In a notable act of philanthropy, Reed Hastings, co-founder of streaming behemoth Netflix Inc (NASDAQ:NFLX), has gifted $1.1 billion worth of his Netflix holdings to the Silicon Valley Community Foundation, a charity beloved by tech magnates.
What Happened: The generous donation represents around 40% of Hastings’ direct ownership in Netflix. The company’s stock recently saw a significant uptick following a strong earnings report. This move continues Hastings’ legacy of philanthropic endeavors, particularly in education and support for historically Black colleges, as reported by the Wall Street Journal.
The Silicon Valley Community Foundation, founded in 2007, provides donor-advised funds that allow individuals to designate a portion of their wealth for specific charitable causes. These donors receive immediate tax benefits and a higher degree of privacy than some other forms of philanthropy.
Despite their appeal, donor-advised funds have been criticized for allowing the donated money to remain idle for extended periods while offering immediate tax deductions. On the other hand, private foundations, another popular charitable vehicle for the affluent, must distribute funds over time and disclose information about donations and charitable operations.
Why It Matters: Hastings’ donation follows a recent trend among tech billionaires contributing significantly to charitable causes. This is evident in MacKenzie Scott‘s philanthropy, who has donated nearly $16.6 billion to various causes since her divorce from Amazon.com Inc.’s Jeff Bezos in 2019.
Earlier this year, Hastings purchased a majority stake in Utah’s struggling ski resort, Powder Mountain, following his stepping down from Netflix as CEO. Philanthropy and investment in public-centered initiatives appear to be a key focus in his post-Netflix life.
Moreover, tech companies themselves are also becoming more charitable, with Baidu Inc. donating its quantum computing laboratory to the Beijing Academy of Quantum Information Sciences earlier this year.
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