In keeping with its mandate, the Stellar Impact Foundation sometimes will serve as a Fiduciary Sponsoring Organization for it project initiatives.

Reasons for Sponsorship

Assuming it is within our mandate, and meets our requirements, SIF will sponsor an organization under two sets of circumstance:

a. The organization is a small, “Mom & Pop Shop”, size initiative that will never require large infrastructure and overhead.

It should be noted that this is in alignment with the IRS’s intent to reduce the number of 501c3 filings that it has to administer each year.  By encouraging the use of Fiduciary Sponsorship, administration of multiple smaller entities gets aggregated under the fiscal oversight of fewer larger entities, thereby helping to reduce the burden of government, and make the IRS more efficient.

b. The organization is a fledgling initiative, still in its launch & startup phase.

We essentially provide incubation, coaching, and interim support while the project goes through the sometimes long & tedious work of legal registration, IRS determination, setting up bank accounts, developing infrastructure, and so on — until such time as the project has proved itself viable, and is able to become an independent organization under its own 501c3 status.

Again, this reduces the burden of government, by not inundating the IRS with a host of projects that might ultimately never succeed.

Donor Protection

It is SIF’s philosophy that donors, particularly large philanthropists, are investors in the communities and initiatives they help.  It is duty, and our legal fiscal responsibility, to protect our donors and their investment.

Fiduciary Sponsorship does this a few significant ways:

a. Stewardship of Resources — Aggregation of resources into a single sponsoring organization prevents donor impact being diluted by being spread too thin. Sponsorship avoids incurring unnecessary costs of redundant overhead, particularly in the early stages of a project’s development.

b. Reduced Risk — Why invest in the huge setup of massive infrastructure, when there’s a very high probability that most initiatives will not actually succeed? Fiduciary Sponsorship provides the stable platform of an existing infrastructure. Once the project is proven viable, then it makes sense to start building out it’s own self-sustaining structure.

c. Financial Accountability — Fiduciary Sponsorship provides visibility, transparency, and routine reporting so that you are not just throwing your money into a proverbial black hole.

Sponsored organizations are required, by law, to turn in monthly financial reports of their activities. Furthemore, SIF requires a Strategic & Financial Review every 90-Days, as well as submission routine audits of their financial processes. As a donor, you can know that SIF is faithfully guarding the intentions of your donation, by seeing that the funds you supply are being properly accounted for.