Introduction

Tree of Life
A Donor-advised Fund for Africa

With its Donor-advised Fund, Tree of Life is providing donors with an innovative way to invest and distribute charitable capital in Africa.

Investments pave the way to predictable funding. It is for this reason that individuals planning retirement will save and invest over a number of years in preparation for a time when they will fund their living expenses by making withdrawals from a retirement fund. One can withdraw between 2.5% and 5% from such a fund per year – after retirement – without running an unacceptable risk of jeopardising the longevity of the fund.

Similarly, we believe that charities can best be supported by creating a significant investment fund and distributing between 2.5% and 5% of the value of such a fund to charities. We have been making investments in this way since 2007 with excellent results, and are now offering this product to high net worth clients who want to use their charitable contributions in the same way.

An additional benefit is that the available investment options include impact investments, that supports good business by investing in companies that make a difference in society.

The Donor-advised Fund is an ideal solution if you have earmarked funds for giving and want to move this off your balance sheet into a charitable structure, but do not want to incur costs in setting up legal structures.

The Donor-advised Fund is a more cost-effective solution than forming your own charity, as the platform has significant benefits of scale, because most overhead costs are only incurred once for the entire platform and are spread across many donors.

At the same time, donors retain flexibility regarding:

  • the charities and causes that should ultimately benefit from the donation;
  • the timing of distributions to these charities; and
  • how donations should be invested until distributed to charities.

How does it work?

How does it work?
  • You open a Tree of Life Donor-advised Fund and transfer money to it. USA taxpayers should qualify for a tax deduction in the US, and in certain cases South African taxpayers and donors in other countries may also.
  • You select the investment portfolio in which you would like the funds to be invested. The portfolios offer different options in terms of risk and liquidity to match your needs.
  • We provide you with a quarterly statement so that you can keep track of your Donor-advised Fund and investment performance.
  • You decide when, how much, and to what charities your Donor-advised Fund should make grants.

Key information

Key
information

The Tree of Life Donor-advised Fund caters for both foreign and South African donations. Via links to Trustbridge Global and the National Christian Foundation (NCF), donors in the USA can make a donation to the NCF, may qualify for a tax deduction, and direct that the money should be transferred to their Donor-advised Fund on the Tree of Life platform. Through Trustbridge Global donors in other countries can also contribute to a Tree of Life Donor-advised Fund, but tax benefits vary by country.

Tree of Life's Donor-advised Fund is unique in the investment options it provides, including private equity and impact investment opportunities. Since its formation in 2007 Tree of Life has built up an impressive long-term track record of investing donor capital in selective private equity opportunities and generating returns that provide funding to ministries and charities.

For an overview of our investment options


CLICK HERE
Investment options

Donors are able to select one or more of the following pooled portfolios, in which their donations will be invested until distribution:

  • Short-term cash portfolio

    This portfolio allows withdrawal at the end of each calendar month.

  • Medium-term portfolio

    This portfolio consists of listed instruments, collective investments and hedge funds, and allows withdrawals at month end on 60 days’ notice.

  • Long-term private equity portfolio

    This portfolio offers the best opportunity for long-term growth of donor capital. The main aim of the portfolio is to generate investment returns, with the investment itself having a beneficial impact as an additional but secondary consideration.
    The portfolio avoids investments considered to be harmful, or incompatible with our world view. This portfolio does not offer guaranteed liquidity. It will aim to provide liquidity equal to 2.5% of portfolio value p.a. that can be paid into the Donor-advised Fund’s liquid portfolio, or reinvested. Liquidity can also be made available if there is a liquidity event in the portfolio (e.g. sale of an underlying asset) or based on new inflows.

    • For a video on a typical company in this portfolio

    VIEW VIDEO

  • Impact portfolio

    The main focus of this portfolio is the positive impact its investments will have on society, with financial returns as a secondary consideration.
    Given the nature of the investments, the portfolio does not offer guaranteed liquidity. Liquidity can only be made available if there is a liquidity event in the portfolio (e.g. sale of an underlying asset) or based on new inflows.

    • For a video on a typical company in this portfolio

    VIEW VIDEO

  • Impact portfolio

    The main focus of this portfolio is the positive impact its investments will have on society, with financial returns as a secondary consideration.
    Given the nature of the investments, the portfolio does not offer guaranteed liquidity. Liquidity can only be made available if there is a liquidity event in the portfolio (e.g. sale of an underlying asset) or based on new inflows.

    • For a video on a typical company in this portfolio

    VIEW VIDEO

Charities / Fees

Distributions to charities

The ultimate beneficiary of a Donor-advised Fund must be a registered charity that is approved by the platform.

Fees

There will be no initial fee on donations received, except actual Trustbridge charges and bank charges on international transfers.

To fund the cost of providing the service, the platform will levy an asset-based recurring platform charge of 0.45% p.a. (levied quarterly) as well as an investment management charge that varies according to portfolio.

The investment management charges will be:

  • 0.25% p.a. on the short-term liquid portfolio.
  • 0.75% p.a. on the medium-term semi-liquid portfolio. A performance fee equal to 20% of the outperformance above a benchmark of CPI + 3% will be levied.
  • 2% p.a. on the long-term private equity portfolio. A performance fee equal to 20% of the outperformance above a benchmark of CPI + 5% will be levied.
  • 2% p.a. on the impact portfolio.


To help cover overheads from non-sticky money and to discourage multiple small transactions, a distribution fee of 1% with a minimum of R500 will be levied when money is actually distributed to charities.

It is important to note that as all fees will be internal in Tree of Life, fees do not leave the charitable space and can be viewed as a charitable contribution to Tree of Life. Any surplus will be used as directed by the Tree of Life trustees.

How to open a Fund

How to open a
Donor-advised Fund (SA Donor)
  • Step 1

Fill in the Stewardship Navigator Contribution Form

Note that there are different versions of the contribution form for donors
South Africa Contribution Form.

Send the signed application form to .

  • Step 2

South African Donors: Pay your donation into the correct bank account as indicated on the application form

Note that there are different accounts for section 18A donations and other donations. Use the name of the donor as payment reference.

Send proof of payment to

Learn More

How to open a Fund

How to open a
Donor-advised Fund (US Donor)
  • Step 1

Fill in the Stewardship Navigator Contribution Form

Note that there are different versions of the contribution form for donors
USA Contribution Form.

Send the signed application form to .


  • Step 2

US Donors: Pay your donation into our Giving Fund at the NCF

There are several ways to do this. In all cases you will need to know that the name of our Giving Fund is “The Tree of Life (South Africa) Fund” and our fund number is #1462307.



Learn More
Donors
from elsewhere

Donors elsewhere in the world, please contact us for instructions by sending us an email to

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