What do you do when you are facing a financial opportunity that could change your life? Do you walk by faith or fear? Learn how the National Christian Foundation (NCF) helped two software engineers leverage a major liquidity event to have greater giving impact than they ever imagined possible.
Craig Chapman sat in his study, trying to find a few moments of quiet time. He read the words of Philippians 4:6-7 over and over again, ”Do not be anxious about anything,” as he considered the call to leave the company he had co-founded, and the opportunity to sell some of his holdings. It was a big risk, and he wanted it to count – not for himself, but for the Kingdom. Craig was deeply hoping that this event would give him enough resources to pursue full-time ministry while continuing to support his young family. But he also wanted to keep his promise to give half of any gains from the company to God’s work.
This leap of faith was a big step on a journey of generosity that began when Craig and April were newly married. It was a second marriage for both of them, and they had significant debt. Both of them had been raised to seek worldly success and “Look out for number one,” and thus had no role models of generosity. But as they began their new life together, the Lord clearly led them to take the risk of tithing regularly, despite their difficult financial circumstances.
April says, “We had been married about five years, and we were both working at Microsoft. God was growing our ability to be generous through increased stock grants and multiple stock splits.
"We found that the more resources God gave us to steward, the more fun it was to give."April Chapman
As time went by, their debt was paid off, their spirit of generosity grew, and so did their capacity to give.
Eventually, they both left Microsoft and began to live out a life of significance, investing in a number of local ministries based on the L.I.F.E. principle – Labor, Influence, Finances, and Expertise – that they had learned from Campus Crusade for Christ. It was then that the Lord led Craig to co-found a technology company with a fellow believer and friend from Microsoft. After seven long years of work, their company became quite successful, and they began to prepare for a possible public offering. Craig knew that he would need to choose whether to continue working there for three or four more years, or leave ahead of the IPO.
Here at the crossroads, he made a significant decision. He would gift half of the stock a new group of investors was offering to buy, and sell the rest. He knew about the National Christian Foundation Seattle, and he called them to see if they could help him give the stock before the sale in order to turn the massive capital gain into more giving capacity.
But there were several challenges. First, his company wasn’t public yet, so giving stock ahead of the sale to sophisticated private investors was tricky, if it could be done at all. Secondly, this unusual opportunity to sell some of his shares was all tied up in the acquisition his company was attempting. So his desire to give and sell needed to be handled in such a way that it would give all the various stakeholders confidence that the acquisition would not be put at risk.
Here is how NCF helped Craig and April engineer their gift for maximum Kingdom impact:
- 1. Plan
To give the stockholders confidence that the gift would not impact the deal, 50% of the shares they were planning to sell were transferred to an LLC with Craig and April as the managers.
- 2. Sell
Then, they gifted the LLC interest to NCF. Later, all the shares were sold to the new investors in conjunction with the acquisition.
- 3. Give
By giving the shares before the sale, Craig and April were able to convert the capital gain tax to additional charitable giving.
- 4. Receive
They also received a fair market value deduction for their gift, which further offset their gains on the shares they sold directly.
“We want to use all God has given us to multiply our impact for His Kingdom,” Craig says.
"We’ve learned that gifting non-cash assets before the sale is simply a smarter way to leverage our giving, and do more for those in great need."Craig Chapman
Craig adds, “We now have more capacity to give of our L.I.F.E. than we ever imagined possible. It’s an exciting time for us, and we feel so privileged and humbled that God is using us in this way.”
By: Sheila Dolinger
Based in Atlanta, GA, Sheila Dolinger is a communications consultant and contributing writer for the National Christian Foundation (NCF), the world’s largest grant-making ministry for Christian givers. For more information, visit www.nationalchristian.com.