Two new reports found that giving circles are becoming increasingly diverse, especially among Latinos, but that new giving-circle hosts sometimes have trouble balancing day-to-day operations with lofty long-term goals.
The first report said people who have been giving-circle members for at least a year tend to be older, white, higher income, and married, while newer members tend to be more diverse in terms of age, income, and race. “These differences are even more pronounced when comparing new members to five-plus year members,” a summary of the report said.
The second report said contributing to a culture of philanthropy and increasing diversity are the top reasons new hosts are motivated to start a giving circle. Hosts also said required staff time, differences in expectations between the giving-circle members and the host, and costs are the top challenges to achieving their goals.
The reports come from the Collective Giving Research Group with support from the Women’s Philanthropy Institute. The first study is called “Giving Circle Membership: How Collective Giving Impacts Donors,” and the second is called “Dynamics of Hosting Giving Circles.”
“The new research can help the sector continue to advance and grow collective giving models to be more effective, sustainable, and inclusive,” said Debra Mesch, a department chair for Women’s Philanthropy at the Indiana University Lilly Family School of Philanthropy.
In the United States, giving circles tripled in number from 2007 to 2017, to 1,500, and have donated as much as $1.29 billion since their inception, the reports said.
Infrastructure Support
The Bill & Melinda Gates Foundation recently announced a $250,000 grant to Amplifier, a network of giving circles based in New York. Felicia Herman, founder and board chair of Amplifier, said the Gates grant helps the group meet a $370,000 budget to fund a “co-design process” to research what giving circles need next. So far, Amplifier has raised nearly $330,000.
Herman is also the executive director of the Natan Fund giving circle. Other networks like the Asian Women Giving Circle and Faces of Giving, led by Hali Lee, are looking to increase the power of giving circles by reaching people who are nonwhite and non-Hispanic — both middle-class and wealthy donors — groups that philanthropy has largely ignored.
Lee said one strength of giving circles is that they dodge the traditional board-meeting structures and ease people into philanthropy.
“We knew that raising money, especially for small nonprofits in ethnic communities, is something people are afraid of, " Lee said. “But it’s not rocket science. It’s why we built a fundraising component in our circle so we can all learn together and teach other. We’re sisters, in a way, so it’s not intimidating.”
Dallas Giving-Circle Hub
While most larger giving circles are based in New York and other major coastal cities, they are gaining strength throughout the country. The Texas Women’s Foundation, in Dallas for example, has ramped up its support for local giving circles, including the Orchid Giving Circle, whose members are Asian women. Cynthia Yung, founding chair of the Orchid Giving Circle, said the foundation is its fiscal sponsor and handles its tax paperwork.
Meanwhile, the giving circle also drew start-up support in the form of matching funds from the membership organization Asian Americans/Pacific Islanders in Philanthropy, which pledged to help fund 50 giving circles nationwide. In 2015, its first year, the Orchid Giving Circle consisted of 22 women and received the maximum match of $12,500. They made $76,000 in grants for programs on breast-cancer awareness, after-school projects for immigrant kids, and domestic-violence support for women who don’t speak English.
The Orchid Giving Circle now has 37 members committed to raising at least $2,500 annually. In total, the giving circle has raised around $400,000 since its founding.
Yung, who is also executive director of the Boone Family Foundation, helped another two giving circles start this year in Dallas, both founded by African-American women, one particularly for millennials. She expects continued growth in giving circles, largely due to word-of-mouth.
