The foundation is not a legally defined term, but the basic idea is to dedicate assets permanently to a purpose – charitable or private. Originally, this concerned land, buildings, or works of art whose importance to the general public was so great that they were to be secured in the long term. Today, it is mostly sums of money used to promote education, climate protection, culture, or social causes on a long-term basis.

Legally, a foundation is an independent body of assets, i.e., capital that does not belong to any person but serves a defined purpose. The foundation pursues this purpose independently – it "belongs" to itself.

Who owns the assets of a foundation?

Nobody. After its establishment, the assets become legally independent – they no longer belong to the founder, but rather "bind themselves to their purpose." They may only be used within the framework of the articles of association.

How much money do you need to start a foundation?

For a legally independent foundation, experts usually recommend at least €100,000 to €200,000 so that returns can be generated from the capital. However, it can also be done on a smaller scale: Trust foundations or digital foundation accounts (e.g., via bcause) enable entry from just a few hundred or thousand euros – with significantly less effort.

What is the most popular legal form?

The legally independent foundation under civil law is the best-known form. However, trust foundations are becoming increasingly popular because they involve less bureaucracy and lower hurdles – while still enabling long-term commitment.

Is a foundation only for the rich?

No – but for a long time, they were primarily designed for wealthy individuals. This is currently changing. New, digital models also give people with smaller amounts of money access to structured, impactful engagement – without having to set up their own foundation.

Example:

A foundation that permanently supports educational projects in the Global South can invest its capital in such a way that funds are provided year after year for scholarships, school materials, or infrastructure – even decades after its establishment.