When the Forum of Regional Associations of Grantmakers decided to conduct a study on giving circles in the early 2000s, it expected to examine a “small phenomenon.” What they found was something else entirely. Reports, initially completed in 2005 and again in 2007, documented a “substantial and growing philanthropic movement” cropping up around dining room tables and in living rooms across the country.
In 2008, as Americans found themselves in times of unexpected financial hardship, TIME Magazine wrote an article on how giving circles were becoming increasingly popular, especially among “aging boomers” looking for ways to bring both meaning and fun into their retirement years. And its not just boomers that participate. Alan Frosh, former El Pomar Fellow and chair of the Gordian Fund, is an advocate of giving circles as a way for the next generation to become philanthropists before they have made their millions.
According to the Forum of Regional Associations of Grantmakers’ 2006 study, which was released in 2007, many giving circles are intergenerational, although some do target a particular age group. With regard to gender, women-only circles make up a slight majority of giving circles across the nation, but co-ed and all-male giving circles make up 47 percent of the total. Geographically, this philanthropic trend is increasingly prevalent across the entire United States, and the Colorado Springs Gazette, in an article written about giving circles, reported that Colorado Springs has at least six.
What is a giving circle?
A giving circle is a small group of individuals who pool their dollars and gather—often over food—to collectively decide where the funds will be donated. Some giving circles also engage their members in volunteer efforts.
How common are they?
While giving circles have been around for a number of decades, their popularity has grown tremendously in the last ten to fifteen years, according to the Forum of Regional Associations of Grantmakers. In 2004, when the organization first began researching the matter, they identified 200 circles and collected detailed information on 77 of them. In the second study, conducted in 2006, more than 400 circles were identified with detailed information collected from 160 of them. The most recent estimates approximate the current number to be more than 800.
How do giving circles work?
Giving circles take myriad forms, and there are no concrete rules on how to establish one or how it should operate. Many giving circles are made up of groups of ten to twelve friends who meet on a regular basis to donate and discuss the intent of their contributions. One giving circle in Colorado Springs, the Giving Hearts Club, meets monthly for a dinner soiree at a member’s house—the location rotates every month—where each member contributes $35 to $50 to a pot of money that will be distributed to nonprofits. Some giving circles choose to meet monthly like the Giving Hearts Club, but others may opt for quarterly meetings. Regarding the contribution, some require a certain dollar amount while others set a range to be donated to the circle each month.
Why give collectively?
Although any nonprofit staff member will tell you that every dollar helps, it can be quite difficult for an individual to have a significant impact with his/her single contribution. However, when you pool the individual donations of a dozen people together, the result is the kind of gift that so many small charities really need these days. According to the 2006 study, giving circles granted $13 million to local community organizations that year. Research shows that giving circles make sense; donors accomplish more, learn more, and give more strategically when they are involved with one.
How do I start a giving circle?
What is exciting about giving circles is that there are no set guidelines for their establishment or dreaded paperwork to fill out like the IRS Form 990 to fill out. So gather your friends for a potluck dinner or wine night, come up with a mission, and talk about ten percent. Or, if you need a little bit more structure to circle up, check out the Forum of Regional Associations of Grantmakers’ ten basic tips.