NEW YORK CITY, NY – NOVEMBER 17: (L-R) Stuart Goldfarb, Jahm Najafi and Harlan Coben attend 2008 BOOKSPAN LITERARY Celebration at The Pierre Hotel on November 17, 2008 in New York City. (Photo by BEN GABBE/Patrick McMullan via Getty Images)
Patrick McMullan via Getty Images
On Wednesday, Jahm Najafi, a Phoenix-based private equity billionaire and part owner of the Phoenix Suns NBA team, became the 242nd person to sign The Giving Pledge.
“Over the past couple years, we’ve become more and more comfortable about the idea of being public,” Najafi told Forbes in an interview. “We thought that this would be an opportunity for us to become publicly associated with causes…and thereby help others support those causes.”
Founded in 2010 by Warren Buffett, Bill Gates and Melinda French Gates, the Giving Pledge bills itself as a “movement of philanthropists” that includes everyone from Mark Zuckerberg to Steve Schwarzman. The cost of admission to this exclusive club comes in the form of a promise, made publicly in a letter: that you will give at least half of your fortune away during your lifetime or after you die.
Najafi, 60 years old and worth an estimated $1.3 billion, including a minority interest in the Phoenix Suns, says he’s already given between $50 million and $100 million to arts, education and diversity and equity causes. Najafi says he wants to make good on his promise before he dies, rather than relying on his will. That means he’ll have to give away over half a billion dollars in the next few decades.
An Iranian by birth, Najfi’s family immigrated to the U.S. when he was a child. He studied economics at UC Berkeley and received his masters degree from Harvard before working on Wall Street and joining his older brother’s real estate firm. In 2002, Najafi branched off on his own, launching the investment firm Najafi Companies to put his own capital to work.
One of his most lucrative investments was a $100 million bet in 2003 on domain registrar Network Solutions, which he flipped for $800 million just four years later. His bet on the Phoenix Suns was also well timed: he bought a 10% stake in the team in 2009 for an estimated $43 million; that stake is now worth some $400 million.
Najafi says his first blush with philanthropy was tucking wads of cash underneath pillows at hotels he stayed at. “I didn’t want their supervisor to see it and wanted the person who was actually changing the bed sheets to get that,” he tells Forbes. As he got wealthier, Najafi and his wife, author and entrepreneur Cheryl Najafi, decided to adopt a more systematic approach to their giving. “We wanted to do it in a more thoughtful fashion,” he says. “We decided that education was very, very important to us.”
In recent years, Najafi’s investment portfolio and philanthropic concerns have collided. In March 2021, Najafi committed to give $1 million per year to the NBA Foundation over 10 years in support of the organization’s mission of driving economic empowerment for Black communities, his largest single commitment to date.
Najafi is the 7th person to sign the Giving Pledge in 2023. That beats the five people who signed up last year, though the pace of new signatories has slowed over time: the Giving Pledge added 61 signatories in 2010, its first year, followed by 25 in 2012 and 18 as recently as 2019.
While giving away money sounds easy, not all of the giving pledgers are keeping pace. Many “aren’t fulfilling their pledges or have questionable fulfillment methods,” claims a recent report from the Institute for Policy Studies (IPS), a progressive think tank. The study takes aim at those who are giving to their personal foundations and donor-advised funds, or DAFs, rather than directly to active nonprofit groups.
These so-called “charitable intermediaries” provide an immediate benefit to billionaires in the form of tax deductions, but often stand in the way of money getting into the hands of organizations that need it. (Private charitable foundations are only required to give away 5% of their assets per year, while DAFs have no payout requirements at all.) The IPS study identified several high-profile pledgers who give significant sums to their personal foundations or DAFs, including Bill Gates, Warren Buffett, Elon Musk, Charles Koch, and Sergey Brin. “We were surprised by the pace of funds moving to intermediaries, particularly donor advised funds,” says Chuck Collins, a director at IPS and one of the study’s three authors.
Najafi, for his part, says he’s made all of his charitable contributions directly to operating charities and organizations, rather than routing them through a foundation or via DAFs, though he says plans to establish a personal foundation are underway. Najafi says that he plans to review the IPS report’s findings. “We’ll reflect on it,” he says.
A spokesperson for the Giving Pledge did not comment on the IPS report’s findings. The spokesperson said that the Giving Pledge is “thrilled to welcome Jahm Najafi” to its ranks.