The People's Philanthropy: Giving Circles Organize, With Help From a Big Funder

Contra Costa Latino Giving Circle members, courtesy Latino Community Foundation

Modern giving circles embody the age-old practice of pooling resources to benefit others. These groups, which donate and give collectively to causes of members’ shared interest, constitute an accessible form of philanthropy that has sprouted and grown over the past four decades. A 2016 study stated the number of these circles had tripled since 2007, reaching about 1,500. It was estimated that the circles identified in the research had granted up to $1.29 billion.

These circles often support local causes and can serve as a gateway into philanthropy and civic engagement. Women make up the majority of circle members, and the groups tend to be more diverse than philanthropy as a whole. And giving circles also connect into networks. Since about 2017, members of major circle networks have come together to evaluate the giving circle movement and its potential for collaborative development and growth.

In late 2019, a giving circle infrastructure design initiative (naming and branding are underway) led by network representatives received $2 million in anchor support from the Bill and Melinda Gates Foundation to launch a five-year infrastructure project. Here, we see a major institutional funder backing the evolution of grassroots philanthropy. The initiative will launch in 2020 with four general goals: to showcase, scale, strengthen and sustain the giving circle movement. “Democratizing and diversifying” philanthropy are overarching objectives.

Leaders from five giving circle networks are coordinating this project: the Latino Community Foundation (LCF), home to the largest Latino giving circle network in the U.S.; the Community Investment Network (CIN), which supports giving circles impacting African Americans and communities of color; the Asian Women Giving Circle (AWGC); Catalist (formerly the Women’s Collective Giving Grantmakers Network); and Amplifier, which centers on Jewish values. In addition to Gates, the initiative has received support from the Lodestar Foundation, Delores Barr Weaver Fund, Bank of America, Schwab Charitable and other donors, and it will be fiscally sponsored through Global Impact.

Marsha Morgan, CIN chair, says the initiative aims to “catalyze the giving circle movement to over 350,000 [people] in more than 3,000 circles,” with a goal for these groups to give “close to $1 billion” in total during the next five years. “[Beyond] scale, we hope that these circles are doing their work in a stronger and more sustained way.”

Helping Giving Circles Connect, Shine and Succeed

Most giving circles are similar in that they aim to be member-led, collectively impactful, and sustainable. But they come in many shapes and sizes. Some are entirely volunteer-run, some are independent nonprofits, and some receive funding or logistical support from larger philanthropies like community foundations, which may charge fees for their services.

“The cool thing about giving circles is that there’s no one right way to do them. People get really creative about how they structure their circles to right-fit their group, their values, their communities,” Hali Lee, AWGC founder, says. While this self-determination is a source of identity and power for circles, it can also be isolating and challenging at times. Many groups negotiate member recruitment, grantmaking and other activities all on their own.

Mindy Freedman, founder of the SAM Initiative, a circle in Los Angeles, says one challenge of running a circle is that “there are no rules... Every giving circle I know of, we kind of jerry-rig it so that it works." She says some giving circles exist “in a vacuum.” She mentions the Catalist network (of which SAM is a member) as an existing resource for collective giving webinars, conferences and more. Speaking of the new giving circle infrastructure initiative, she says that if there was a bigger network “we could all tap into,” it could potentially relieve some of the burdens for individual circles.

The infrastructure project aims to help circles share needs and best practices for their mutual benefit. To succeed, it will likely have to create a flexible, evolving space that draws on the unique strengths of these community-based coalitions while fostering increased stability and impact through organization and collaboration.

Scaling Collective Giving

LCF Vice President of Programs and Policy Masha Chernyak says the initiative will provide donor education and branding support “that will further energize our grassroots movement.” Over the next five years, the project will try to better showcase giving circles’ work online and in print through storytelling and other kinds of communication projects. It seeks to scale and further diversify the field of collective giving, including with an annual incubator for new circles and convenings for existing groups. It also plans to support circles with research, staffing, and technical and financial help. Earlier in 2019, the networks running the infrastructure project awarded 13 microgrants totaling $32,000 to circles and networks working in alignment with their goals. The initiative is currently seeking more funding and an executive director.

Isis Krause of Knead Partners, a strategy consultant for the undertaking, says the initiative’s priorities and plans were made through a yearlong co-design process “with over a hundred stakeholders” from the giving circle field. Multiple gatherings, calls, interviews, working groups and workshops that took place over the last few years brought the networks behind the infrastructure project to this juncture.

Gates and other funders supported several of these stepping stones, including a gathering of 82 members of dozens of U.S. circles in April 2019. The Gates Foundation, and Melinda Gates in particular, have developed an increased focus on women, girls and gender equity. This makes giving circles, which are so popular with women, a good fit. The foundation’s support for the circles also ties into its exploration of charitable giving by everyday Americans, “Giving By All.” It’s a counterpart to the Giving Pledge, Gates’ work encouraging philanthropy among billionaires.

Because one goal of the infrastructure initiative is to help out burgeoning giving groups, we asked Chernyak of LCF how she would advise a new giving circle founder. She says they should follow their “hearts and guts,” rather than looking to foundations or corporations for best practices. She recommends centering giving circle work on “having fun, leading with values and taking collective action… Money is great, but it’s not going to change the world. [So who] will? It’s us, coming back to ourselves and each other to create a community that leaves no one behind.”

We also asked Freedman of SAM what advice she would give to someone starting a new giving circle. She says, "It’s really important to establish [where] in the landscape you want to have an impact... identify your members and understand what is meaningful to them.”

Democratizing and Diversifying Philanthropy

Along with building visibility, structure and opportunity for giving circles, the initiative intends to democratize and diversify philanthropy. While giving circles are generally designed to be democratic, with members voting on how to spend their pooled money, some circles already adjust donation requirements to level the field for potential newcomers.

“We’ve seen groups try lots of different strategies to draw people in: shared memberships, sponsored memberships, different pricing for younger members,” says Paula Liang, chair of Catalist. These kinds of efforts can make giving circles more economically accessible, and in turn, more representative of diverse communities.

“What I know for certain from the experience of my home group, the Women’s Giving Alliance in Jacksonville, Florida, [is that] once we started [intentionally] bringing in women under 40 with some co-funding and programming for them… they started bringing their networks: friends, co-workers, sometimes their moms, and those networks were much more diverse than ours. And that was a game-changer.”

According to the 2016 study referenced above, giving circle membership remains primarily white; however, they are more diverse than much of the traditional grantmaking sector. (This research was funded by the Gates and Charles Stewart Mott Foundations). While men were present in about 66 percent of groups surveyed, women made up the majority of members in 70 percent of circles. About 60 percent were identity-based groups. These circles may align around LGBTQ+ communities, religion, race and/or gender, or other identities.

Approximately 40 percent of circles had one or more African American or Latino members, and 30 percent had at least one person who was Asian or Pacific Islander on board. People who were racial and/or ethnic minorities in the U.S. made up the majority in 11.5 percent of groups. And research in 2018 (also funded by Gates) found newer circle members tend to be more diverse in terms of race, age, gender and income.

Chernyak says that with the help of the infrastructure project, circles across the country “will feel like they are part of something even bigger—a national movement of everyday people who are reclaiming philanthropy back for the people.” She adds that Latinos, African Americans, women and immigrant communities “will start to truly see themselves for who they are: generous, strategic and powerful philanthropists.”

She says when Latino Giving Circle members close their eyes and picture a philanthropist, she wants them to see “their parents and grandparents, not just Bill Gates. Many of us come from families whose grandmother fed the whole neighborhood, mothers who fought night and day against injustice, fathers who chipped in for weddings or funerals, and aunts who helped us pay for college. This is philanthropy in action. [It’s in] our collective DNA.”