What would happen if a group of nonprofit leaders got together to decide how to split up a pot of money, with no input from the grant maker?
It would offer a rare break from the usual routine of accepting a foundation’s money with specific guidelines on its use — something many nonprofit staff dream of — but would it work?
Ten years ago, after RSF Social Finance tried just that, one participant — as if reading everyone else’s minds — wrote, “I thought it could be a disaster or a beautiful experience, and it was a beautiful experience.”
Since then, we’ve continued to develop a participatory approach to grant making, which seems only more relevant as critics inside and outside philanthropy question whether we should continue to let wealthy people and their institutions decide what everyone needs.
This rising chorus prompted me to analyze feedback on the 14 efforts — called Shared Gifting Circles — we’ve facilitated over the past decade, along with adaptations we’ve made in response to that feedback.
The results reveal a range of benefits — from transformative personal experiences to the opportunity to tackle larger issues of diversity, equity, and inclusion — as well as insights for foundations looking to let their communities lead.
Our approach goes beyond the typical spectrum of participatory grant-making practices, which runs from unilateral (we’ll just tell you about our grant decisions) to consultative (soliciting advice and concerns from the community) to collaborative (two-way communication that leads to joint decision making).
When I first observed it, in a session by the Mid-States Shared Gifting Program, I was overwhelmed by how different it felt from traditional philanthropy. We were looking for ways to democratize our own practice, and this seemed like an avenue to restoring trust, building community, and sharing power.
In our adaptation of the shared-gifting approach, we select six to 10 local nonprofits (from community nominees) to spend a day together and decide how to divvy up a pot of money among themselves. They review one another’s proposals and ask questions about one another’s work. Typically, each participant receives $10,000; they keep $2,000 and must distribute the remaining $8,000 according to their own criteria. We encourage participants to be open with the group about how they made their funding decisions. The group also decides how participants will report back on their use of the gift.
New Connections
Participants obviously recognize how this method redistributes power, but the experience itself confers the most compelling benefits. In the tally of our feedback, 70 percent of participants said they especially prized connecting with leaders in the field, learning about one another’s work, and reading one another’s proposals. Other benefits cited include:
- Opportunities for resource sharing and partnership (26 percent).
- The chance to discuss common goals in the field and understand what funding makes possible throughout the field (23 percent).
- The opportunity for peer learning, giving and receiving feedback, and talking openly about challenges (21 percent).
That’s not to say power issues are unimportant. “Shifting power dynamics and turning competition into collaboration” (27 percent) and “being given the experience of giving and receiving” (18 percent) were also significant benefits.
“It really hit home that this was the only time that I had ever been able to truly influence the funding of other artists and organizations that are run by and serve people of color,” wrote one participant in a circle of community-organizing and arts organizations.
Many (20 percent) also appreciated understanding others’ decisions and noted that transparency in the decision process — something they find sorely absent in typical grant making — creates mutual accountability.
Despite the relatively small amounts given away, 84 percent said the grant amount and experience warranted a full day of their time. “I spend at least that much time, most often significantly more time, preparing grant applications for much less,” one participant wrote. “Not to mention, it was worth the time to get to know my colleagues and their work better.”
The Big Lesson
In our decade of facilitating Shared Gifting Circles, we’ve learned lessons on how to run them well and larger lessons about the range of responses to a shift in who holds money and power.
On the more practical side, we quickly realized that the process creates the value, so it can’t be rushed. Participants gain huge benefits from reading one another’s proposals and talking about them: They get to see how other people make a case. When they field questions from their peers, they see what’s not clear about their own case. Potential collaborations and connections come pouring out.
To get those results, the group needs to be small enough so that the grant sizes are meaningful and communication is relatively easy. We’ve found six to 10 is the sweet spot, though others have made shared gifting work with slightly larger groups. The most successful circles also include a facilitator whose familiarity with all the issues affecting the people around the table allows us to address shared issues and gain meaningful context.
On a deeper level, we’ve seen that while many people feel a surge of empowerment from the shared-gifting process, others are uncomfortable with making decisions about who should receive money and how much.
A few participants in every circle will decide to give everyone an equal amount. Some people experience this as affirming and building community among the participants, something that would never happen in traditional philanthropy. Others see it as the group members not being ready to give one another direct feedback or make difficult decisions, which is understandable given that they spend only one day together. In addition, making decisions about money as a community isn’t a familiar experience for most of us. It is a new skill, worth developing because it’s crucial to community self-determination.
We’re still learning and refining our practice. For instance, we’d like to further reduce our power in the process: We request nominations for participants, but we still narrow the list and ultimately decide who participates. Potential solutions include inviting previous circle participants to pick new participants or selecting half the participants ourselves and asking them to invite the other half. We also want to incorporate the Post Growth Institute’s Offers and Needs Market, a facilitated process in which community members share what they have to offer and what their needs are.
Sharing the Approach
Something has shifted in the philanthropy world, and there is a real openness to the concept of participatory grant making. At RSF Social Finance, we get so many inquiries about shared gifting that we’ve created a starter tool kit and other resources for grant makers. We also offer support for those who want to adapt the process and make it their own.
The potential benefits are significant: grant-making organizations can use this process to enable a more diverse group of people to make funding decisions, which we’ve found leads to support for a more diverse group of organizations. Many people who are seeking to incorporate shared gifting into their practice see it as a decolonizing wealth strategy.
Crucially, participatory grant-making practices like shared gifting aim to transform philanthropy, not the individual participants. It’s not just a more effective grant-making strategy, it is fundamentally transforming a broken philanthropic approach. A common frustration for participants is that after taking part in a Shared Gifting Circle, they have to go back to fundraising the traditional way. As valuable as the process was for them, they’re forced to get back into “just tell me what you want me to do to get the money” mode. The participants are already experts in what their community needs, so they should be the ones making decisions. By flipping the current approach to philanthropy on its head, we can transform the power dynamic — or rather, we can shift grant-making authority to the already powerful nonprofit leaders.
Kelley Buhles is senior director of philanthropic services and organizational culture at RSF Social Finance. She leads the Shared Gifting program and plays a key role in coordinating RSF’s Integrated Capital approach to financing.