Private schools in Silicon Valley are shifting their fundraising model. Instead of relying solely on annual galas, auctions, and traditional giving, these institutions are launching their own venture capital funds. These programs allow schools to invest donations into early-stage, pre-IPO companies. By leveraging the expertise of parent-investors from firms like Sequoia and Lightspeed, schools can access exclusive deal flow that typical donors never see.
The approach gained notoriety after Saint Francis High School realized a massive return from an early stake in Snap. When the company went public in 2017, that initial $15,000 investment grew to $34 million. Today, schools use these gains to fund teacher retention bonuses, tuition assistance, and capital projects. Because these schools operate as 501(c)(3) nonprofits, they avoid capital gains taxes on their returns, allowing more profit to remain within the school community.
Running a venture fund requires more than just capital. Schools form advisory boards of volunteer investors to vet potential deals and manage risk. This model demands patience, as venture returns often follow a long timeline. While many schools maintain traditional operations, this shift toward investment-based fundraising creates a new way to build permanent endowments. By bringing students into the process, these schools are also teaching the mechanics of entrepreneurship directly on campus.
As more high-growth tech companies stay private for longer, these schools are positioning themselves to participate in the value created before an IPO. It is a departure from the bake-sale era, transforming school foundations into active participants in the tech economy. While not every investment is a guaranteed success, the model provides schools with the chance to build wealth that far outpaces standard fundraising efforts.