How The Justin Baldoni-Blake Lively Saga Led A Billionaire To Shut Down His Foundation

Forbes

Paylocity founder Steve Sarowitz built a charitable foundation around the values of Baháʼí, a little-known faith from Persia. The organization funded hundreds of nonprofits until it suddenly announced its closure in May amid ongoing legal drama and frightening threats.  Read the full story here: https://www.forbes.com/sites/monicahunter-hart/2025/07/04/how-the-justin-baldoni-blake-lively-saga-led-a-billionaire-to-shut-down-his-foundation/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, how the Justin Baldoni, Blake Lively saga led a billionaire to shut down his

00:06foundation. All appeared normal at the Wayfarer Foundation in the weeks prior to its announcement

00:13that it was shutting down. The team was actively recruiting a grant manager and summer interns.

00:19A new manager of growth and culture started in April. Employees were planning events with

00:23Wayfarer's non-profit grantees. Even its billionaire founder, Steve Sauerwitz, was talking about a bright

00:30future, emailing grantees on April 9th, quote, Though we're living in a time of profound change,

00:36the foundation remains committed to our mission. Our work is only beginning, and we have much to

00:41do together. Then, around 5.30 a.m. on Monday, April 28th, Sauerwitz awoke to a dwindling fire in a trash

00:49can in the driveway of his home in a Chicago suburb. He put it out with two water bottles,

00:54according to a fire department report. Later that day, his wife received a text from an unknown sender

01:00claiming to have helped set the fire. The person threatened to kidnap the couple's daughter,

01:05a senior at Northwestern University, writing that she wouldn't, quote, make graduation unless they

01:10forked over $80,000. This story was confirmed by a Lake County State's Attorney's Office spokesperson.

01:16Referencing a claim in actress Blake Lively's lawsuit against Sauerwitz, his partner Justin

01:22Baldoni, and the film studio they co-founded, Wayfarer Studio, the text said, quote,

01:28If you guys are prepared to spend $100 million to ruin the lives of Ms. Lively and her family,

01:33we are sure you can spare a few for your daughter.

01:36The threats kept coming and became increasingly violent, per an indictment filed with the 19th

01:42Judicial Circuit Court of Illinois. By that Friday, Sauerwitz had decided to shut down his

01:48foundation. Hours after informing staff, he wrote on Facebook, Instagram, and LinkedIn, quote,

01:54Upon unanimous decision of the board of directors, today we will begin the process of sunsetting.

02:00Sauerwitz tells Forbes, quote,

02:02We decided that private giving was a better way to go forward.

02:05He explains that he will start donating through a donor-advised fund instead, or DAF.

02:12DAFs are increasingly popular philanthropy vehicles for high-net-worth individuals,

02:17in part because they do not require filing public financial reports.

02:21Sauerwitz adds, quote,

02:22Foundations can be slow and bureaucratic. This gives us a lot more flexibility and allows us to

02:27give more money with fewer resources.

02:30DAFs also allow the ultra-wealthy to give in near secrecy.

02:34There's ample reason for Sauerwitz to want privacy at the moment.

02:39In December, Blake Lively sued him, Baldoni, and Wayfarer Studios.

02:44She accused Baldoni of sexually harassing her on the set of their movie,

02:47It Ends With Us, which he directed, they co-starred in, and the studio produced.

02:52She alleged that Baldoni then illegally retaliated with a media smear campaign,

02:57funded by Sauerwitz, when she spoke out about his behavior.

03:01Baldoni, Sauerwitz, and the studio have denied the allegations.

03:05They countersued Lively for defamation and extortion, claims that a judge dismissed on June 9th.

03:11The Wayfarer Foundation was widely reported to be Baldoni's organization when the news of its closure broke.

03:17According to Forbes' reporting, though, it was Sauerwitz's entity.

03:21He provided the funding, while Baldoni advised on its activities as a board member.

03:26Sauerwitz contributed some $160 million to the foundation,

03:30which doled out nearly $60 million to over 200 non-profits from its 2021 founding through 2024.

03:37He's contributed another $90 million to a separate charitable family foundation with a separate mission that his wife runs.

03:44Well-established private foundations typically sunset over years, not weeks.

03:49Several media outlets blamed Wayfarer's shuttering in part on financial difficulties arising from the legal battle.

03:57That's not likely the case.

03:59While experts say the hefty legal, security, and PR expenses could already total $40 million,

04:05Sauerwitz still has an estimated $2.3 billion fortune,

04:09which stems from founding payroll firm Paylocity, with a market cap $10.2 billion,

04:15decades ago, and running it as CEO until 2011.

04:18While $1.6 billion of that is tied up in Paylocity's shares,

04:23Forbes estimates he has another $700 million in cash and other investments,

04:27more than enough for him to have funded the foundation's 2025 budget of $40 million for several decades.

04:34For full coverage, check out Monica Hunter Hart's piece on Forbes.com.

04:40This is Kieran Meadows from Forbes.

04:43Thanks for tuning in.

04:48Kieran Meadows from Forbes.

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