James Boyd

The Circle of Life: The Power of Collective Giving

There are over 800 Giving Circles in the USA and they’re taking off in Australia. James Boyd, winner of the FIA Perpetual Scholarship 2010 and WA Manager of Artsupport Australia, visited California, Oregon and Washington State in June 2011 to discover what drives their success.

James Boyd

James Boyd is the WA Manager of Artsupport Australia. Artsupport Australia is an office of the Australia Council for the Arts introduced to grow cultural philanthropy. Previously, James was Development Manager for the West Australia Symphony Orchestra raising $15 million over five years and winning 12 awards including the 2008 Abaf National Corporate Partnership of the Year and 2008 Abaf National Giving Award.

Giving Circles have begun an exciting new era of philanthropy in the US and are developing in Australia. A cross between a book club and an investment group, Giving Circles offer an engaged, team approach model of philanthropy. In a Giving Circle, donors place their charitable dollars into a pooled fund, and decide together which charities to support. The benefits are clear to see: power by numbers and motivated donors who enjoy seeing the benefits and rewards of a group gift, above and beyond the effect they could make on their own.

When I travelled to the US, I wanted to identify the key elements of successful Giving Circles, establishing why some thrive and others fail:

How can Giving Circles ensure maximum impact?
How can they enrich the lives of members?
What were the keys to a sustainable and cohesive group?
How can the introduction of this inclusive and exciting method of giving be encouraged in Australia?
How can Giving Circles foster greater levels of giving in Australia generally?

The stories of three inspiring circles provide some answers to these questions.

Impact100 Sonoma

Without significant impact, collective giving groups will not sustain the interest of its members. Impact100 Sonoma know this well.

In Sonoma, a region just north of San Francisco with a population of 40,000, I met Christine Dohrmann and Annette Lomonts, who arrived in 2009 and were keen to develop friends and support the community. They decided to form a Giving Circle based on a model first introduced in Cincinnati called Impact100. The idea was simple: encourage 100 people to give $1000, pool the funds and make grants to local community groups.

Eighty people turned up at the inaugural meeting. Four months later they had 140 paying members, from all walks of life. After two years Impact100 Sonoma has 180 annual members, pooling funds of more than $180,000 a year.

To make sure it had significant local clout, the group’s annual grants include a single gift of $100,000 to a community group - a game-changing size grant for many organisations. The remaining funds are distributed between four or five other shortlisted organisations. To ease decision making, expressions of interest are invited which the group shortlist to around six applicants. This avoids groups having to complete a full application unnecessarily.

Christine warns that it can be hard on the losers, especially in a small close community, but with all shortlisted applicants receiving a grant, it’s manageable. She also stresses the importance of the high impact grant of $100,000: “It’s not our mission to make four grants of $25,000 each. This is our greatest strength.”

For Impact100 Sonoma donors, giving $1000 and seeing valuable local impact is a powerful motivator. In addition, donors become much more aware of the needs of their community. Some donors volunteer or give more to specific organisations that appeal. Christine and Annette’s leadership was also essential. Their determined voluntary work keeps the group together. However, importantly, from the outset they said that they will step down from the leadership after three years stressing: “This group is not about us, it’s about our community”.

Giving Circle, Portland, Oregon

A small giving circle in Portland, Oregon - so small it didn’t have a name - left a considerable impression on me. Gail Durham gathers with twelve women in Portland on a regular basis for afternoon tea. They’re all retired now, but weren’t when they began their circle eleven years ago. Each donates $500 annually, making a pool of $6000. In their case the group has one interest - to offer an annual scholarship “to a woman in their community rising out of poverty”.

Gail explained that they make the donation through the Portland Community Foundation, acting as their “host organisation”, which offers auspicing advantages. Gail says: “The process of deciding who to give the scholarship to, out of 160 applications, is very enriching for the group. Members learn a great deal about the lives of others in Portland and they make a real difference to an individual’s life each year.”

The group often remains in contact with scholarship winners, and offers help and mentoring beyond financial support.

Washington Women’s Foundation

This celebrated group was founded by the inspiring “matriarch” of Giving Circles in America, Colleen Willoughby. From small beginnings, WWF is now a significant success story inspiring similar initiatives across North America (and in China).

Based in Seattle in Washington State, Colleen wanted to put the knowledge and capacity of local women to good use. It began when she gathered five women friends and created the inaugural board. Through their shared networks they recruited donors at $2000 each a year. Colleen explains the mission is to “support local non-profit community organisations and mobilise women’s interests and knowledge”. Since starting in 1996, the WWF recently celebrated grants of $11 million benefitting more than 990 non-profit organisations.

At the group’s core are educational programs for its donors. Members are invited to numerous education forums throughout the year, from non-profit industry guest speakers to financial advisers on how to assess grant applications. Along with education being a key to success, all members give equally and have an equal vote.

After 13 years as the volunteer president, Colleen stepped down. Members now give $2500 each year, $500 of which is put towards administration and program development costs, including a paid CEO.

In 2010 they made five grants totalling $475,000 across the interest areas of arts and culture, education, environment, health and human services. Interestingly, four of the five grants went towards “general operating support”. Colleen adds insight into greater achievements: “It’s not only the dollars we give, but the dollars we influence.”

KEYS TO SUCCESS:

1. Leadership

The leadership and effort required is significant and volunteers will nearly always be required to start a circle.

2. Donor commitment:

The donation level needs to be affordable while being large enough to get buy-in from donors.

3. Scope of interest

All circles must have real, noticeable impact so consider focusing grants on the local geographical area, cause or on a specific international community where the dollar goes along way.

4. Structure and influence

Give all members an equal vote, even if they give different amounts (in which case the donation levels over a minimum are confidential). As a circle grows, a more complex decision making structure is needed. Circles must offer its donors the ability to influence grant decisions. Decisions should be challenging but informed.

5. Use of funds

Try to retain minimum funds for administration costs. You are better to give it all away, see the impact and retain your donors.

6. Quality information and engagement

Great information provides great learning and results. Offer donors engagement with the grant recipient through site visits and volunteer opportunities.

7. Education and learning

A key attraction to involvement should be the learning it offers.

8. Timeline

Structure a circle to the financial year and break your year into three stages: donor recruitment, publication & application; research & assessment; and granting.

9. Enjoyment

Make any meeting of a Giving Circle the most enjoyable meeting of the month.

There’s no reason why Giving Circles shouldn’t flourish in Australia. Indeed, some are beginning to surface. To my knowledge, Australia’s first Impact100 group is currently in its early stages of development in Western Australia. If you are not involved in a Giving Circle of some nature, you are missing out!

Long-term Benefits of Giving Circles: