Elon Musk gave $5.7 billion in Tesla Inc. stock to charity in 10 days in November, far more than he’s given out through his eponymous foundation in the two decades since its inception.
Elon Musk appears to be maturing into a philanthropist on par with his billionaire contemporaries.
The electric car and space entrepreneur gave $5.7 billion in Tesla Inc. shares to charity in 10 days in November, far more than he’s given away through his eponymous foundation in the two decades since its inception. It’s unclear where that donation will go, but it’s just another indicator that the world’s richest person is taking philanthropy more seriously.
Musk’s decision to donate more than 5 million shares in the electric-car maker was reported in a regulatory filing Monday night, and it comes on the heels of some of his largest-ever philanthropic gestures – but nothing on the scale of billions of dollars. It would also assist to cut what he described as the largest tax bill in US history.
The Musk Foundation in the past couple of years has made eight-figure grants to the city and local school system near his South Texas spaceport, a $100 million ready-made competition to fight climate change and millions of dollars to a pair of Covid-19 researchers.
Almost all of those grantees have largely worked with Igor Kurganov, a professional poker player-turned-philanthropist whom Musk has recently hired to keep in touch with grantees and assess their applications.
Altruism That Works
Kurganov, who has earned over $18 million in poker, is involved in the field of so-called effective altruism, a philanthropic and philosophical movement that aims to have the greatest influence by spending money wisely to solve issues. Kurganov is one of the co-founders of Raising for Effective Giving, a group of poker players who promote “very cost-effective organisations.” He’s also a consultant for the Centre for Effective Altruism’s Forethought Foundation.
Kurganov has not responded to calls or emails. Musk’s family office managing director Jared Birchall and Tesla’s senior manager of stock administration Aaron Beckman did not reply to requests for comment.
According to Alixandra Barasch, an associate professor of marketing at New York University who has studied the movement, if Musk’s foundation is moving to effective altruism, it hasn’t shown yet.
Musk doesn’t make his donations public on a regular basis, and tax filings that do contain such disclosures take years to arrive. Musk recently donated $10 million to Brownsville, Texas, which is close to where SpaceX is situated, to help rebuild its downtown. That money has so far been used to fund a grant programme for local property owners, lighting improvements, and murals.
Raise the stakes
Effective altruism is primarily concerned with saving lives, and “murals don’t do that much good in terms of how it’s assessed and characterised in the movement,” according to Barasch.
Other gifts from Musk, such as $20 million for Cameron County schools, $100 million for the XPrize Carbon Removal competition, and $5 million for Khan Academy, lack the emphasis that effective altruism usually has, according to Barasch. But, she added, scale matters, and if Musk’s foundation is affected by the philosophy, his donations might skyrocket.
“When I look at those figures, I’m like, ‘Holy moly, there’s millions of dollars, that’s a lot of money,'” she says. According to Barasch. However, “it’s nothing in comparison to what he’s worth. According to the Bloomberg Billionaires Index, Musk is worth $227 billion. The pledge of $5.7 billion in Tesla stock could indicate that he’s speeding up his charitable giving, but it also doesn’t mean he’s contributed anything to charity yet. According to Brian Mittendorf, an Ohio State University professor who researches nonprofits, the donation most certainly went to Musk’s foundation.
Given Musk’s previous usage of DAFs, the public may never know where much of the money is going until he chooses to broadcast it on Twitter or the Musk Foundation’s website, he said.
The ‘Guessing Game’
“We shouldn’t have to play this guessing game,” said Benjamin Soskis, senior research associate at the Urban Institute’s Center for Nonprofits and Philanthropy. “Because the size is so vast, it’s a matter of public interest where the money is going.”
Musk’s November shopping binge coincided with his Twitter feud with politicians about his taxes. A significant donation to charity would help him pay off his debt to the government. Tesla’s CEO tweeted that he would pay more than $11 billion in taxes for the year, only days before completing a sequence of stock sales for more than $16 billion, the majority of which was to fund the exercise of nearly 23 million options.
In the weeks leading up to the contribution, Musk also said he’d sell stock if the United Nations could demonstrate that $6 billion would help end world hunger, after the president of the organization’s World Food Programme urged billionaires like Musk to “stand up.”
Musk’s proclivity for being provocative, as well as his massive gift announcements, have made it difficult for the public to decipher his intentions. Soskis is unsure what the employment of Kurganov and the subsequent $5.7 billion pledge signify for Musk’s philanthropic future.
“Your guess is as good as mine,” Soskis remarked of Musk’s gift’s eventual destination. “There is no clear pattern in what he’s done.”