How the Merger Boom Can Drive Donations to Charity

There are many ways to donate to charity, but doing so via escrow funds is a new one: A mergers and acquisitions (M&A) services firm called SRS Acquiom has partnered with a charity group called Pledge 1% to launch EscrowUP, a charity program for dealmakers.

It works like so: Every M&A deal includes an escrow fund, where the seller sets aside money in case something unexpected comes up after the deal closes. (Approximately two-thirds of deals have an escrow claim after closing, though not all are necessarily granted.) Dealmakers that work with SRS Acquoim and want to participate in EscrowUp pick a charity. After the escrow period ends, SRS Acquiom donates 16 to 24 basis points on the amount held in escrow equally to the charities involved.