Program-Related Investment (PRI) FAQ

  • Program-Related Investments (PRIs) are investments that 501(c)(3) nonprofits can make to advance their charitable missions. PRIs can take multiple forms (e.g., direct equity, debt, structured instruments, recoverable grants, etc.) and may generate financial returns that can be recycled into further charitable activities. For an investment to qualify as a PRI, it must meet three core requirements:

    • The primary purpose of the investment is to accomplish one or more of the organization’s exempt purposes (charitable purpose).

    • No significant purpose of the investment is the production of income or the appreciation of property.

    • No purpose of the investment is to influence legislation or to participate in a political campaign on behalf of or in opposition to a candidate for public office.

  • As a 501(c)(3) public charity, Inspire Access can receive tax-deductible donations from a range of sources (referred to as donor-investors), including Donor Advised Funds (DAFs), foundations, family offices, individuals, corporations, and other nonprofits. Inspire Access can then use these funds to make a Program-Related Investment (PRI) into a for-profit company or fund, as long as the investment advances our charitable purpose and meets the IRS’s additional PRI criteria outlined above.

    Founders come to us with their investment opportunity, which we diligence for PRI eligibility (see our full evaluation criteria on our Partnerships page). If the partnership is approved, founders become eligible to source donor-investors. Inspire Access supports founders throughout the raise period by providing materials for investor conversations, joining meetings, and sharing our network. While we cannot fundraise on behalf of founders, with us as a partner, founders are able to unlock a new funding channel of philanthropic capital and no longer need to compete for a limited pool of venture or private capital.

    Once there is a committed donor-investor, we manage the remainder of the process - receiving the donation, administering the PRI, managing returns, and tracking performance. We start every donor-investor relationship with a 15 - 20 minute call to answer any questions and guide them through our Donor Investment Account Form and Donor Agreement. Donor onboarding is a quick process, but we must wait until the donation is received before executing investment agreements for the PRI. We therefore recommend building in a 2 - 3 week buffer before the official closing date of your raise to avoid any timing issues. Any returns from the investment are managed according to the recommendation of the donor-investor, which may include reinvesting or returning them to a DAF or foundation.

    For founders receiving the PRI from Inspire Access, the process is akin to a traditional investment, but we invest on founder-friendly terms.

  • You are welcome to share the information you provided for our partnership evaluation, but do note that our process is designed to focus on mission alignment and the criteria most important to us as a 501(c)(3). While we review many of the same materials to get a broad sense of your organization, our priorities and requirements are likely to be different from those of a traditional investor. For that reason, our evaluation should not substitute the due diligence a prospective investor may wish to conduct individually. With that said, if a donor-investor is interested in learning more about our process we are happy to share our evaluation template. 

  • A PRI, like a traditional investment, is dilutive capital, but the structure depends on the terms you set and agree to with the donor-investor. Inspire Access is the official investor of record, but we do not negotiate terms and will not participate in investments with predatory or highly restrictive provisions that are not founder-friendly. If there are multiple donor-investors, we can pool their funds and take a single line on your cap table. We maintain records of each individual contribution and manage any interest payments or distributions at exit.

  • Our fees are minimal, we only take a small percentage to stay operational. There is a 1% fee on the initial donation with the remaining invested and if and when there is a return, we charge a 1% fee on profits for each year the investment is held (ex. If there is $100 profit after a 5 year investment, the fee would be $5).

  • Once we have received a completed Partnership Form we aim to respond within a week and target making a full decision within a two week timeframe.

  • Once we connect with the donor-investor, onboarding is straightforward and quick. Timing can be affected by the channel through which the donation is sent (e.g., DAF, personal check). A major benefit of partnership is that you are pre-vetted for a PRI, so once the donation is received our turnaround is quick - typically a few days and up to a week at most. Please note that we cannot execute investment documents until the donation is confirmed, thus we highly recommend working closely with us to align incoming donation timing with your closing date.

  • No. We only make PRIs into for-profit, US-registered companies or funds with majority of operations in the U.S.