Strategies for Giving
Giving Circles
Joining or forming a giving circle provides you with a hands-on
opportunity to collaborate with others and practice giving in a supportive
environment.
Giving circles vary in structure, size and charitable focus. A giving
circle is generally a pooled fund established by more than one donor for the
purposes of joint-decision grantmaking. Donors often commit to participation
for several years at an established dollar level and the funds are donated
to nonprofits chosen by the entire group.
Some giving circles are very informal, nothing more than a group of
friends with a bank account meeting in each others' homes to discuss and
decide upon where their funds will go. Other giving circles have hundreds of
members and a governing board, and they may use their local community
foundation to manage the financial aspects.
Some giving circles offer members an option to designate part of their
annual dues to nonprofits of their own choosing (this can be done
anonymously), with the remainder going into the pooled fund for joint
decision-making. Many giving circles offer their members a chance to work on
grantmaking committees and evaluate nonprofits first-hand via site visits
and other volunteer activities. And often, giving circles provide a venue
for discussion of broader issues related to philanthropy, such as financial
planning.
Next Steps:
Visit the web sites of these Northwest giving circles to learn more
about how they operate:
Social Venture Partners
Washington Women's Foundation
Read the information below on how to start your own giving circle:
Giving Circle Starter Kit
Overview:
Giving Circles are an enormously powerful way to impact social change
and pave the way for a new frontier in philanthropy. In the same way that
venture capital supports innovation in the business world, Giving Circles
use a model of "venture philanthropy," infusing nonprofits with financial
and intellectual capital, resources and contacts. Joining or forming a
Giving Circle provides you with a hands-on opportunity to explore and
collaborate with others who share the desire to make focused, social
investments with impact.
In a Giving Circle, you pool your resources with colleagues and/or
friends who share a common interest in a social cause or issue. Together,
you gain in-depth understanding of your interest area, focus on ways the
group can have impact, make joint social investment decisions, and leverage
your monetary contributions with volunteerism and expertise to the charities
you support. Donors often commit to participation in a Giving Circle for
several years at an established dollar level and the entire group engages in
strategic decision-making to determine which charities to partner with.
Giving Circles allow for a wide range in charitable styles, philosophies
and politics, and vary in structure, size and focus. Usually a circle begins
with an individual gathering a small, informal group whose members share a
desire to:
- Learn more about philanthropy as a vehicle for social change
- Leverage the impact of their charitable contribution
- Connect substantively with the communities and causes they care about
- Participate in a social network of people who share similar interests
and values
The advantages of forming Giving Circles are many:
- Pooled dollars invested towards a key issue can have a far greater
impact than smaller, individual gifts.
- Collective "know-how" of a group adds value and impact to volunteerism
and philanthropic investment, (i.e. developing budgets, evaluation,
providing technical support and contacts, etc.).
- Creating partnerships with a small number of nonprofits allows a
deeper level of involvement to better gauge your return on investment.
- Participating in a Giving Circle is an excellent way to deepen your
understanding of issues important to you.
Forming a Giving Circle:
To begin, identify a group of people who have an interest in coming
together to form a giving circle. The common link between these people may
be that they are peers, colleagues, or family members, or simply that the
group has a common area of interest (i.e., education, arts, the
environment). You may want to consider asking a facilitator to lead the
discussions for the first few meetings. This will allow you, the catalyst of
the circle, to participate more fully. An experienced facilitator will
greatly help expedite the process of these suggested steps in creating a
giving circle.
Ten Fundamental Steps for establishing a Giving
Circle
Step One—Set
Goals and Structure for Giving Circle
Bring your group together for a first meeting. Most likely in inviting this
group you have explained the concept of a giving circle, but it is a good
idea to take time at this first meeting to discuss what this venture is.
Begin the process of setting goals and structure now. There are several
decisions that can to be made in the early phases of a giving circle that
you may want to begin to discuss at this meeting. Some of these are:
- How many times will the group meet?
- How shall we determine our funding focus?
- Where to hold meetings?
- Is there a limit on number of participants?
- What is the size or range of the financial contribution each shall
make?
- What is the time commitment?
Remember that the idea of the giving circle is to go beyond individual
"pet" charities to pool your resources for a common goal with greater
impact. The expectation is to contribute time as well as dollars in the
process.
Step Two—Mission
and Commitment
Once the group sets up regular meetings, it is a good idea to establish a
mission, set meeting guidelines, agree on common goals and objectives, even
think of a name to call your group. Generally the first few meetings will be
spent firming up things from group dynamics to financial commitment to focus
area. It is also a good idea to give all members of the group the
opportunity to work on tasks. Creating a rotating chair, designating a
treasurer and setting up "committees" or work groups will build the common
purpose.
As an independent group, you can set your own guidelines for operation.
There is no specific "rule book" you need to follow. There are decisions
that need to be made though, and determining the process for decisions ahead
of time will facilitate smooth operations.
Things to remember: The contribution amount from each individual can
vary. Each giving circle is different. There are circles that make $50,
$500, $5,000, or even $25,000 in annual commitments. This is one of the more
compelling benefits to giving circles, as the group gets to decide what is
reasonable for their particular circle. It is important for the group to
have 100 percent consensus on the final amount. In a giving circle, no
single vote on a potential grantee should outweigh another, and with
everyone contributing equally, this should even out this potential issue.
Step Three—Where
To Place Your Collective Dollars
It is recommended that all members make a financial commitment to the giving
circle at the start of each year (i.e., write the check). There are options
for where your circle members' money can sit. There are benefits to all the
options, depending on the circle's needs, experience, and structure. Giving
circles traditionally have no administrative "over head." All dollars
contributed go to the designated charity(ies), and the administration of the
circle is done on a volunteer basis by the members. You can:
- Open a joint bank account.
- Partner with an organization that can act as a financial administrator
of the funds.
- Establish a Donor Advised Fund at a community foundation. For
information on the Community Foundation serving your community, call the
Council of Foundations at 202.466.6512, or visit www.cof.org, or meet with
a staff person to learn the benefits of this option.
- Create a public foundation. Contact the Council of Foundations at
202.466.6512, or visit www.cof.org, for more information.
- Write individual checks to the chosen charity(ies) once donations have
been determined.
- Explore other creative options depending on the group.
Step Four—Establish
an Issue/Focus Area for Contributions
This step may take some time and discussion to determine. You may want to
choose a process to find a common area(s) of interest. Encourage the group
to define the focus area specifically. For example, if the group is
interested in health issues for women - what specific health issues? For a
particular age range? Demographic? Define geographic area where you will
seek out potential organizations or service providers.
You may also want to invite "experts" in the field to present information
sessions to the group or assign group members to investigate particular
issues. This is an area in which consensus is important for the giving
circle. It is the combination of time, treasure and talent toward one common
focus that creates the investment impact.
Step Five—Create
Smaller Work Groups for Giving Circle Tasks
Once the focus is established, having members of the group volunteer for
particular tasks will build personal commitment and interest in the work of
the giving circle. These smaller groups can look at such issues as: What
charity is doing the best work in your field of interest? How do you know?
Be willing to take a risk by funding a start-up charity, or by funding a
charity that may seem unconventional to traditional funders. Remember you
are the "Board of Directors" and can set your own guidelines.
Step Six—Develop
Process and Criteria for Determining Who Will Receive Contributions
This is an ideal assignment for a committee. You may decide to take a
traditional approach and ask for written applications from a charity or you
may evaluate a group in another manner. What will be the criteria for
determining who receives funding? Will you review grant applications? Will
you visit specific organizations who could "qualify"? What kind of a report
will you want at the end of the project period from the recipient of these
funds? This process can be as simple as choosing a recipient organization
based on information you gather and then writing a check to that group, or
as involved as reviewing written applications, visiting the organizations
headquarters or project area, and/or asking for a presentation.
If your group is unsure of how to assess an organization, you may want to
consider asking someone with a background in grant making or nonprofit
administration to give the group assistance (or maybe someone in the group
could take on this role).
It is also important at this stage to establish final evaluation
criteria. How will you measure your giving circle's impact? How will the
organization(s) that receive funding measure the impact of this funding?
Step Seven—Develop/Define
Partnership with Recipient of Contribution
Do members of your group want to volunteer for an organization you have
funded? Group should define in what ways they can offer assistance. Web
development, finances, program planning, legal work, and mentoring, are some
examples of ways your members might get involved. Be sure to be clear with
the expectations of all involved in this new partnership.
Step Eight—Review
Potential Recipients for Donations and/or Visit Charities
Conducting site visits with potential grantees can be enormously helpful in
the grantmaking process. This is the time to ask questions, get
clarification about something that maybe wasn't clear in the proposal, and
see things in action.
The group should set aside plenty of time to discuss the potential
grantees (up to five hours, depending on number of proposals to review).
There are often compelling reasons to fund many organizations, and members
may feel strongly about funding different organizations. Therefore, time is
needed to go through this process, with full consensus on which
organization(s) to fund at the end.
Step Nine—Make
Contribution(s)
Immediately following the group's decision, alert the recipient of your
intentions, letting them know when they can expect a check. It is good
practice at this time to let those organizations that will not be funded
know of your decision.
Step Ten—Evaluate
the Impact of your Giving Circle
Be sure to take the time to examine the short term and long term goals of
the giving circle on an annual or other regular basis. This will help
develop a sense of satisfaction with the work you are doing and al show how
your contributions have made a difference. It is important to look at your
work and discuss what you've learned, what you want to do the same or
different next time and what the next round of funding will look like in
terms of time and calendar. And in particular, try to determine what impact
this group has had with this venture philanthropy. Candid feedback from the
organizations you have funded and partnered with will always be an important
ingredient of this process. Be sure these lines of communication are open.
Suggested Calendar For First Year to establish a Giving Circle
This is based on one meeting per month in the first year. Once
established, most circles choose to meet less frequently.
- Month 1 First meeting
- Month 2 Conversations on focus area
- Month 3 Establish giving circle guidelines
- Month 4 Guest presenters - Experts in the field
- Month 5 Guest presenters - Experts in the field
- Month 6 Establish criteria for contribution process, and begin
discussion of potential charities
- Month 7 Information sharing (of potential grantees, etc.)
- Month 8 Charity presentations and site visits
- Month 9 Charity presentations and site visits
- Month 10 Review potential charities for contributions
- Month 11 Review potential charities for contributions
- Month 12 Make contribution
Resources
Giving New England has additional materials for starting a giving circle
available on its web site,
www.givingnewengland.org. As more resources become available, these will
be posted on the web site. One publication that we have found very helpful
as a guide for establishing a giving circle is,
Building Community, Creating Justice: A Guide for Organizing Tzedakah
Collectives; by Betsy Tessler and Jeffrey Dekro and published by
The Shefa Fund in Philadelphia,
Pennsylvania. While this guide is specifically about organizing a
faith-based giving circle, the information is an excellent reference for any
giving circle starting up. To order a copy of this publication, please
contact:
The Shefa Fund
7318 Germantown Avenue
Philadelphia, PA 19119
(212) 247-9704
Copyright © 2000 by Giving New England and Marianne M.
Jones -- Reprinted with permission
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