According to a 2009 study, “Donors in giving circles give more, give more strategically, and are more engaged in their communities.”

Giving circles have grown in popularity in recent years.  The concept is simple. Members give a specified amount and collectively decide how the resources should be allocated. From an informal group of friends deciding to pool their funds for their favorite nonprofit to large, local groups like Impact Austin and the Futuro Fund, giving circles are elevating the practice of collective philanthropy.

Often with a combination of educational and social components, nonprofits are also adopting the giving circle model to provide a more meaningful donor experience.  More traditional, and passive, donor recognition groups (which place supporters into designated groupings based on the level of their giving) are being rethought in favor of the more active model of the giving circle. Greenlights’ own 501 Council is a type of giving circle that brings together a group of business professionals, including nonprofit pros, who pool their membership dues and grant them back to nonprofits seeking Greenlights’ consulting services.

Is the giving circle model right for your organization? Here are some questions to consider:

1.) What is the group’s purpose?

Think about how a group of this kind can lend strategic support to your organization. How much do you expect the members to contribute?  Are you hoping to raise funds and awareness around a particular program or initiative or perhaps provide broader support of your mission through this targeted engagement opportunity?

2.) Who is your target audience?

With a more engaged and thoughtful group of donors often comes more loyalty. Do you want to reach out to a new demographic of donors or do you want to engage existing donors in a more thoughtful way and perhaps promote a higher level of giving?

3.) What level of programming and support will your staff provide to this group?

Perhaps even before deciding the group’s audience and purpose, consider if your staff has the ability to manage a group like this. How often will the group meet and will there be leadership within the group itself that will make it more autonomous?

The bottom line is giving circles can be a useful fundraising tool, but more importantly, they can give donors a unique and meaningful way to connect with your organization’s work.  There will always be supporters who are happy to write their contribution check and not engage any further (and we love them too!), but for those supporters who want to do more than write a check, a giving circle can be a great vehicle to get them more involved.

Has your organization applied the giving circle model in a unique way? If so, please tell us about it.