Young Tech Donors Take Leading Role in Philanthropy 50

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America’s 50 most generous donors increased their giving by 33 percent last year—powered in large part by a $1.9-billion gift from Bill and Melinda Gates and a stunning rise in the number of tech entrepreneurs under 40, three of whom gave more than $500-million each.

The increase is striking compared with 2012, when giving by the Philanthropy 50 rose just 4 percent.

Two of the technology wunderkinder who are transforming the profile of big philanthropy have not previously disclosed the extent of their giving. They are Jan Koum, the 38-year-old founder of the messaging company WhatsApp, who donated $556-million to the Silicon Valley Community Foundation, putting him at No. 4 on The Chronicle’s Philanthropy 50, and Sean Parker, the 35-year-old former Facebook president and founder of Napster, who ranked No. 5 by contributing $550-million, split between his family foundation and a donor-advised fund.

They are followed by Nicholas Woodman, 39, and his wife, Jill, 38, founders of the high-tech camera company GoPro, who donated slightly more than $500-million, also to the Silicon Valley Community Foundation.

Nine other donors on the list came from the technology world, making the total 12. That compares with six in 2013, when Mark Zuckerberg and his wife, Priscilla Chan, became the first donors under 30 to top the list. That year they gave close to $1-billion to the Silicon Valley fund, which is now by far the nation’s wealthiest community foundation.

The giving by tech donors is outsize compared with that of people in other industries: It represents 49 percent of the $10.2-billion in donations made by the Philanthropy 50, a list based on total charitable contributions a person made in 2014.

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Changing Patterns

Mr. and Ms. Gates made the list by donating slightly more than $1.9-billion in Microsoft stock in November to their family foundation. The Gateses have not disclosed any other new personal donations since they last appeared on the list in 2009.

The philanthropists in the No. 2 and No. 3 slots are older donors, as has been the case in the past. Ranking No. 2 was Ralph C. Wilson Jr., the owner of the Buffalo Bills, who died in March at the age of 95 and provided $1-billion to charity. His money will go to a family fund he created primarily to aid charities in New York and Michigan.

No. 3 on the list was Ted Stanley, the 83-year-old businessman who made one of the largest financial commitments ever to mental-health research by pledging $650-million to the Broad Institute.

A good chunk of the money donated last year by the most generous Americans is not yet earmarked for a cause, which could fuel more calls in Congress and elsewhere for donor-advised funds and other endowments to distribute their dollars faster.

More than 60 percent of the total donated—nearly $6.3-billion—went to 17 foundations, the most money given to any type of entity, followed by $1.5-billion to 25 colleges and universities.

The under-40 donors were especially likely to put their money into foundations and other endowments for later distribution. Nonetheless, their early gifts show signs of where their dollars will flow eventually.

Matt Sayles

Mr. Parker’s foundation last year provided $24-million to create a center at Stanford University focused on allergy research. Rather than simply setting out to find ways to treat the symptoms of allergies, the center bills itself as the first research unit that will seek cures by gathering experts from a range of fields to figure out the underlying immune-system mechanisms behind allergies.

The Woodmans and Mr. Koum have not given details of where their money will go, but Mr. Koum awarded $1-million through his fund to the FreeBSD Foundation, an organization that provides a free, open-source operating system to computer programmers. Mr. Koum used the system to help launch his company.

Michael Moody, a professor at Grand Valley State University’s Johnson Center for Philanthropy, predicts that the money in the tech entrepreneurs’ funds won’t necessarily stay there long. He says young donors aren’t interested in building endowments and instead want to promote immediate change, especially when it comes to accelerating the pace of scientific discovery.

“They’re always looking for a better mousetrap,” he says. “For a lot of them, that’s how they made their significant wealth.”

Una Osili, director of research at Indiana University’s Lilly Family School of Philanthropy, says she also expects these young donors to get involved in the programs they fund. What’s more, she says, they don’t let institutional boundaries get in the way and instead look at what group of people can provide the best results, no matter where they work.

“It’s not the grateful-alum model,” she says. “Younger donors know talent matters. They’ve seen that in their work life, and now they’re applying it to philanthropy. They’re bringing together talent to spur innovation.”

Team Approaches

That’s the approach Mr. Parker, the youngest donor on the list, took when he provided $5-million to support Stand Up to Cancer in 2012.

Instead of supporting any particular research center, Stand Up to Cancer, which was founded by the Entertainment Industry Foundation, creates cancer “dream teams.” These groups of researchers, who come from research universities around the world, focus on speeding cancer treatments from the laboratory to cancer clinics within three years.

The researchers are required to share information as they learn it, rather than waiting to publish in peer-reviewed journals, and they receive regular visits from some of the group’s scientific advisers.

It’s an approach that Rusty Robertson, one of Stand Up to Cancer’s co-founders, says appeals to young tech entrepreneurs.

“Cracking the code—that’s what young kids want to do,” she says, adding that Mr. Parker “loved the model because he loves creating new things.”

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Sergey Brin, the 41-year-old co-founder of Google (No. 9), is similarly attracted to groups that encourage lots of people to work on big problems.

A significant priority for his family fund, to which he donated nearly $383-million, goes to groups like Ashoka, a nonprofit that trains social entrepreneurs, and the Tipping Point Community.

Like Stand Up to Cancer, the Tipping Point Community gathers experts to focus on a specific issue; in Tipping Point’s case, eradicating poverty in the San Francisco area.

The group enlists people to take part in its “T Lab” fellowship program and asks them to act like software developers racing to launch a new app. The fellows typically brainstorm for six months, using scientific research methods to solve problems like a paucity of child care, early-childhood education, or support for former prisoners.

Marc Benioff, co-founder of Salesforce.com, and his wife, Lynne, who took the No. 14 spot on the Philanthropy 50, also helped Tipping Point by running a campaign Mr. Benioff helped start, called “SF Gives,” which generated more than $10-million from the Bay Area tech set.

The Salesforce.com Foundation, the philanthropy arm of Mr. Benioff’s company, started things out with a $1-million pledge.

The rest of the money came, in large part, because Mr. Benioff picked up the phone and started calling his friends, says Jennifer Pitts, managing director of development at Tipping Point.

Ms. Pitts is confident there’s more help to come from San Francisco’s tech elite.

“We haven’t gotten to everyone yet,” she says.

Rising Tech Influence

If the tech industry’s role in philanthropy keeps growing at the present pace, the trend could be permanently upending the dominance of the finance industry among the nation’s largest philanthropists. Eleven of the donors on the Philanthropy 50 list made their wealth in finance, compared with 14 on last year’s list. The donors in finance provided more than $1-billion, just a quarter of what the tech donors gave.

Topping the list of donors who made their money in finance were John and Laura Arnold, a couple in their early 40s who have attracted controversy for their philanthropy focused on overhauling pension systems. Their $218.4-million in donations, split among scientific, education, public-policy, and criminal-justice efforts, put them at No. 11 on the list.

Despite the presence of eight couples or individuals under 50, the median age of those making big donations was 73, barely edging over last year’s mark. The oldest donor on the list was David Rockefeller, 99, who ranked No. 26 by donating $79-million, most of it to Rockefeller University.

Many other philanthropists made their biggest gifts to colleges and universities.

Jay Jordan II (tied at No. 28), founder of a Chicago investment firm, gave $75-million to the University of Notre Dame for science and technology research. Asked why he gave, he says simply: “It was common sense. It’s my alma mater. It’s a great place.”

He said he wanted to ensure that Notre Dame, from which he graduated in 1969, attracted the best scientific talent for years to come. But he said he’s not moving fast to steer the money in a particular direction. He says he made the gift last year because “I have so much ... money I had to get rid of it.”

Two other donors who made a big university gift were motivated by loyalty but also a desire to promote democracy around the world.

Ronald Weiser, a former U.S. ambassador to Slovakia, and his wife, Eileen Lapping Weiser (tied at No. 41 with six other donors), earmarked $25-million of their $50-million donation to their alma mater, the University of Michigan, to the Weiser Center for Emerging Democracies, which they started in 2008 by giving $10-million.

Mr. Weiser, founder of McKinley Associates, a real-estate investment firm, said he wanted the $50-million to accomplish two things: to draw top thinkers to the University of Michigan and to provide guidance to countries that are making the transition to democracy from authoritarian rule.

The real-estate investor Ronald Weiser and his wife, Eileen, earmarked half of a $50-million gift to their alma mater, the University of Michigan, to help countries make the transition to democratic rule.

The couple timed their donation to coincide with the university’s $4-billion fundraising campaign to spur other potential donors to give.

Mr. Weiser says his long experience with the university made him trust that the institution would be a good steward of the couple’s gift.

“You want to give money to places where you know it will be well spent and be a catalyst for other resources,” he says. “If we are going to give a bigger gift, we want to know how they’re going to use it. We don’t want it to be put into keeping up with this year’s budget deficit.”