Expanding your impact through giving circles

Have you ever wanted to support a cause you’re passionate about or address a community need but didn’t have the funds to feel effective? Here in our little town of Blacksburg, VA a small group of people realized a need for generating more funding for local arts. With the help of the Community Foundation of the New River Valley, this small group set a goal to establish an endowment that would strictly fund local arts organizations. The giving circle, called Art Start, began with ten people committing to give $1,000 each. With this initial $10,000 endowment and continued annual giving, a small group has created major impact for the local arts organizations they care about.

A 2016 report by the Collective Giving Research Group identified 1,087 active and independently run giving circles in the U.S. which was triple the amount from the previous 2007 study. The report also found that giving circles have given a collective $1.29 billion since their modern-day inception. As funding for public services has been on the decline, individual citizens have been coming together to fund causes they value and meet community needs.

To gain an initial understanding of Giving Circles, here are a few definitions.

"A giving circle is a form of philanthropy where individuals with common interests come together as a group to pool their charitable dollars.” -The Sweetness of Circles

"A giving circle is a group of like-minded individuals that get together to create change in their communities. They talk about their values and they decide together where to put their talent, their time, their treasure, and their testimony." -Sara Lomelin, Executive Director of Philanthropy Together, for Giving Circles: A Growing Force for Democratizing Philanthropy

"Also called donor circles, they are a relatively simple way for everyday people to pool their money and decide together where to give it away." -Giving Circles: On-the-Ground Philanthropy and Civic Engagement

“Giving circles have emerged from this context, providing donors with a hands-on, do-it-yourself approach to philanthropy and engagement. Giving circles bring people together to support organizations and individuals, and frequently include social, educational, and engagement opportunities that can connect members to their communities and to one another.” -Who Benefits From Giving Circles in the U.S. and the U.K.?

Giving circles can be a unique tool to fund nonprofits or causes that may be important to individuals but overlooked by major philanthropic dollars. According to Who Benefits from Giving Circles in the U.K. and the U.S., “Giving circles have emerged as an alternative to mainstream, professionalized, bureaucratic philanthropy.” This alternative impact of giving circles is largely tied into their focus on values, identity, and community.

Focus on Values: Giving circles are a great way for individuals to come together based on shared values. Giving circles can focus on arts and culture, environmental protection, education, women and girls, social justice, public housing, and other often underfunded services. A study conducted by Dr. Angela Eikenberry for The Foundation Review revealed that giving circle members in the U.S. were more likely to give to human services, education, and arts and culture organizations than donors not in giving circles.

Focus on Identity: Identity is a central factor for 60% of all giving circles according to The Sweetness of Circles. The article goes on to explain that “as community foundations and other mainstream philanthropic institutions struggle with issues of racial inclusion and responsiveness to marginalized groups and communities of color, Black-led and other identity-based giving circles pose a disruption to philanthropy’s structural barriers to social change.” Our modern structure of giving circles is relatively new, but the concept has been around for centuries. In the U.S., collective giving has roots in Black-led justice movements, Indigenous culture, and women’s movements to name a few. The image below reveals the leading identity factors for Giving Circles in the U.S. 

Focus on Community: Another strength of giving circles is the typical focus on giving to the community they’re in. The study Raising Funds from Giving Circles: Opportunities and Challenges of a Rising Collective Giving Model reveals that out of 358 giving circles that shared data, 85% of their giving stayed in their local communities.  Local giving can have an important impact because those within a community know the needs. The article 3 Ways to Decolonize Philanthropy Right Now states that “one of the most effective ways funders can contribute is to support organizations built around community-driven solutions. Why? Because solutions for the people created by the people have the greatest chance of successfully changing the status quo.” Giving circles members can bring their own specialized knowledge of the local community and also make the joint commitment to increase their impact by investing in the organizations or individuals dedicated to community-driven solutions.

Giving circles provide opportunities to invest in local communities while also creating new community. According to Don Drapeau and Jessica Wirgau, founding members of the Art Start giving circle in the New River Valley, a large appeal of giving circles is the social aspect. Some giving circles have their meetings over a group dinner or regular wine nights. Amber Gonzalez Vargas, program manager of the Latino Community Foundation, states that within giving circles “sometimes there is discussion, sometimes there is movement, but it is not done without hearing every single person in the room. That’s what makes this space so exciting and so inclusive and so real is that it really does provide a space for the collective voice to be heard,” in the article Giving Circles: A Growing Force for Democratizing Philanthropy.

When it comes to the arts, giving circles can be a dedicated funding source for local arts organizations, arts organizations run by and/or centering people of color, and place-based organizations with a focus on utilizing the arts to help solve community needs. Over the past year, donors and community members have come together to keep local arts organization alive during unprecedented shutdowns. Maybe you think your $100 donation to one arts organization won’t make much of a difference. But what if you can get ten friends to commit $100 each? What if those ten friends can find even more people to commit $100? Before you know if, your donation can have a major lasting impact on an organization or even the broader arts and culture sector in the community.

A recent report by The Ford Foundation reveals a developing commitment to diversifying the arts and culture institutions receiving support from major foundations that has traditionally gone to predominantly white organizations. Jim Canales, president of the Barr Foundation, is quoted in this report stating, “The financial commitments represented by this initiative are both timely and vital.  It’s also important that we shift the narrative about what constitutes our ‘cultural treasures’ in this country.” This initiative is bringing together sixteen major donors and foundations to provide $156 million to support Black, Latinx, Asian, and Indigenous arts organization.  With your own giving circle, you could make a commitment to shift the narrative about what constitutes cultural treasures in your own local community.

Giving circles aren’t a perfect solution to the calls for democratizing redistribution efforts of the top wealth holders, but it can be an effective way for a group of people to come together and make a difference in their community. While foundations are slowly making advances towards more equitable giving practices, giving circles can be a solution now. If you want to get started, ask yourself: What do I value? Who do I know that shares my values? What needs would I like to see addressed in my community and which organizations or groups are addressing those needs?

Taylor Wood is a graduate student in the M.F.A. in Theatre in Arts Leadership program at Virginia Tech.