The majority of companies in the United States are governed through one of two ownership structures: They are either privately held by a small group of people or publicly held by a community of shareholders who are legally entitled to maximum profits.
Both of these models are great for preserving and consolidating wealth. But when it comes to addressing our most pressing issues — wealth inequality, racial justice, climate change — these models don’t cut it. In fact, they make matters worse.
Increasingly, nonprofits, philanthropists and impact investors are advocating for alternative ownership structures that support business leaders committed to social and environmental challenges. At the same time, more and more private business owners who care deeply about the value they deliver to their communities are thinking critically about how to ensure that value after they’re gone.
Enter the perpetual purpose trust.
Perpetual purpose trusts are non-charitable trusts established for the benefit of an ongoing purpose that can be used to hold business interests. The trust effectively takes the seat of a shareholder. But since a trust isn’t a person, profits cannot be extracted for personal gain. A trustee or group of trustees, often directed by a stewardship committee of representative stakeholders, governs the company and ensures that profits are used to advance the trust’s purpose.
This emerging model for alternative ownership is designed to protect a company’s mission and values and to preserve independence, allowing profits to be distributed toward a designated social or environmental impact. Importantly, it guarantees those benefits for the long term, even if a company’s leaders change.
In our work at Regenerative Social Finance and the Purpose Trust Ownership Network, we have seen the promise of this structure, especially for business owners who seek an exit but want to preserve their vision after they depart. However, perpetual purpose trusts are still largely unknown to Main Street business owners in the United States.
What would it take to move this promising model from the margins to the mainstream?
Barriers and opportunities
One obstacle is a lack of financing. Companies transitioning to a perpetual purpose trust model need financing to ensure liquidity while the owners are being bought out. Established trusts, like any company, then need additional financing to scale their operations. But few lenders have experience financing businesses structured as perpetual purpose trusts — or, for that matter, any alternative ownership structures like cooperatives or employee stock ownership plans — because they don’t understand them or aren’t aware they exist.
In some cases, trust transitions can be accomplished through owner financing. But when that is not feasible, owners struggle to find the financing they need to make the transition or grow the business once they’ve become a perpetual purpose trust.
Success stories
Fortunately, values-aligned funders are stepping in to meet this need. San Francisco-based Regenerative Social Finance, or RSF, has helped Organically Grown Company and Natural Investments — two of the first 50 perpetual purpose trusts in the United States — transition to a trust model that guarantees their long-term commitment to impact.
Organically Grown Company is one of the largest independently run organic produce distributors in the nation. Since its founding in 1978, it has been at the forefront of the organic food movement, working to minimize waste, ensure fair incomes for farmers and support sustainable production.
Organically Grown Company had long been organized as an S Corporation owned by 45 founding farmers and employees combined with an employee stock ownership plan of over 200 employees. In 2017, as many of its founders were preparing to retire, those remaining sought a new model to guarantee their mission would persist in perpetuity — a guarantee that their existing model didn’t provide.
To officially make the transition to a perpetual trust, the organization needed to buy back stock so that the trust could first become the majority owner, and then transfer ownership from the remaining owners to the trust.
RSF recognized Organically Grown Company’s mission alignment and decided to provide the financing they needed at an affordable rate. In 2018, RSF offered the company a $10 million loan to finance the transition; a few months later, it officially became a perpetual purpose trust.
In late 2023, RSF financed a similar transition at Natural Investments, a socially responsible investment firm. Founded by activists and educators and committed to social justice, sustainability and responsible finance, Natural Investments sought an ownership model that would create more opportunities for women and people of color and spread the wealth of ownership across the organization — all while preserving its commitment to regenerative investments.
A $1 million loan from RSF ensured the firm had capital to finance shares being sold to the newly formed purpose trust. When they made the transition, Natural Investments became the first wealth advisor in the nation structured as a perpetual purpose trust.
What makes these deals work? Leaning into relationships and shared values, rather than treating the deal as a simple transaction.
“Not every financing partner is right for this type of transition,” says Natalie Reitman-White, who led Organically Grown Company’s ownership transition. “It’s critical that lenders share the same values that guide perpetual purpose trusts: transparency, collaboration and a willingness to design sustainable rates of return that aren’t extractive for their borrowers.”
At RSF, we are proud to be a pioneering lender supporting organizations making the transition to perpetual purpose trust structures. These transactions demonstrate that mission-aligned ownership models are not only values-driven but bankable, and we’re committed to helping lead the industry in recognizing and underwriting this next generation of enterprises, securing their impact legacy for decades to come.
Growing the movement
Perpetual purpose trusts can help mission-driven organizations stay mission-driven forever. In contrast to other models of ownership that are vulnerable to takeovers that threaten the mission, perpetual purpose trusts weave impact into the very fabric of the organization. For companies with values-based commitments, like B Corp certification and philanthropic giving, perpetual purpose trusts can lock in these commitments at the shareholder level. They’re one of the best options we have for making sure that impact-first organizations are built to last.
We know it works. So how do we grow the movement?
- Spread awareness. One of the biggest obstacles to the growth of this model is that few people know it exists. In 2024, leaders in the space established the Purpose Trust Ownership Network, or PTON, a nonprofit organization that seeks to educate business owners and the lawyers, funders and advisors that support them to make purpose trust ownership more widely known and accessible.
PTON and peer organizations like the National Center for Employee Ownership and Employee Ownership Expansion Network hope to educate worker groups and business leaders about alternative ownership models like perpetual purpose trusts. - Crowd in funding. Lenders like RSF have proven that perpetual purpose trusts are worthy investments. But only a few of these mission-driven funders are prioritizing alternative ownership models, and that’s a drop in the bucket compared to commercial lending. If pioneering mission-driven lenders continue to demonstrate that perpetual purpose trusts are an investable opportunity, they can leverage the additional funding that’s truly needed to expand this model.
Leaders in the space look forward to exploring these topics and more at the upcoming Purpose Trust Ownership Conference in Austin, Texas, February 26-27, 2026. We look forward to a deep dive into this topic with leading investors who are expanding and diversifying financing for purpose trust transactions.
Dana Stranz is the VP of credit and risk for Regenerative Social Finance. Issie Corvi is the program manager for the Purpose Trust Ownership Network.
Guest posts on ImpactAlpha represent the opinions of their authors and do not necessarily reflect the views of ImpactAlpha.
