One day in the summer of 2002, Marsha Wallace picked up an issue of Real Simple magazine and read an intriguing article.  “It was about a group of friends who had a potluck instead of paying a restaurant bill,” recalls Wallace, a resident of Greenville, SC who was 42 years old at the time.  “The women each pitched in what they would have spent at a restaurant, and donated the proceeds to a charity.”  Wallace was impressed, but quickly set aside the article and returned to her normal routine as a registered nurse and mother.

Months later as she was planning for a birthday celebration with friends, Wallace suddenly recollected the article. “It came to me like a lightning bolt: I want to do that!”  Wallace and her friends met for dinner, and at the end of the evening they each wrote a check to an organization advancing international women’s rights.  “We had so much fun, there was so much energy that I couldn’t sleep that night.”  The group decided to meet again the next month, to raise money for another women’s charity.

From these modest beginnings, Wallace went on to found Dining for Women, a nonprofit organization that now includes over 200 chapters across the US.  “The inspiration was not to create a national operation – I would never have started if I had thought that.”

Dining for Women is a giving circle, a type of charitable group that has gained popularity in recent years.  The members of a giving circle meet together and pool their donations, in order to provide support to one project or organization.  Though giving circles vary widely, they all provide members with a form of charitable giving that feels more direct, extending far beyond simply writing a check or attending a charity fundraising event.

“We should do something!”

Those who start or join giving circles are often new to organized philanthropy.  Their starting point is often a passionate and personal commitment to a cause.  Because of their grassroots origins, many giving circles deal with local concerns. Judy Wright, who co-founded  Cleveland Colectivo with her husband Walter, recalls their motivation for starting this locally-focused giving circle in 2004.  “We were a group of friends, feeling frustrated that we couldn’t make a significant impact in our community, with our limited capacity to donate as individuals.”

Hali Lee was director of a small nonprofit dealing with domestic violence in the Korean community, when she founded the Asian Women Giving Circle in New York in 2006.  Lee already had experience with charitable giving, since she was serving on the board of New York Women’s Foundation.  But she was troubled that the needs of the Asian-American population were rarely addressed or funded.  “It felt personal,” Lee explains.  “I found myself asking, ‘Why don’t we have something?  We should do something!’”

The power of “we”

The next step for these founders was simple: call on your friends.  Much like Wallace and her friends meeting for a dinner party, Lee rounded up ten of her friends, and they crowded into a small New York apartment.  “Everyone there was either someone I knew, or one step away,” Lee recalls.  “Our goal was to be women raising money for other women in our city.”

This shared bond of friendship remains essential to most giving circles.  As groups evolve and become more formalized, the social component connects members in both formal and informal ways.  Monthly chapter meetings of Dining for Women feature a potluck, as well as an educational presentation and donation.

The social aspect is particularly important in women’s-only giving circles, according to Prof. Angela Eikenberry of University of Nebraska at Omaha, author of Giving Circles: Philanthropy, Voluntary Association and Democracy. Eikenberry estimates that about half of all giving circles are women-only.  Marsha Wallace explains, “It seems to be a natural fit for the way women relate to each other.  It’s nurturing for women; they like the safety and support of being with others.”

Giving circles also allow members to expand their professional networks.  Eikenberry notes that this incentive seems to draw men to giving circles, more than the friendships.  She notes that in her own giving circle, the Omaha Venture Group, “it’s great to know organizations in town, people I wouldn’t run across otherwise.  I’m friends with a software developer, a guy who sells insurance, an attorney.”

Most groups allow members some mix of social and professional opportunities. The Birmingham Change Fund is a group of African-American young professionals that is committed to working on issues that affect their city.  Founding member Crystal Goodman says, “There’s trust within the group – we keep a family environment.”  Goodman says that she was just 23 and had recently moved to Birmingham when she joined the group; she appreciates everything she has learned from the other members of the group: “I’ve had access to so many people who have taught me about Birmingham, the nit and grit of the city.  Like the Bible says, ‘iron sharpeneth iron.’  You have no choice but to get sharp when you learn from others.”

Choosing a model

Some giving circles continue to operate on the most loose and informal level, with members meeting, discussing worthy causes, and writing their own checks.  But many decide to establish a more formalized structure for membership and giving.  At Asian Women Giving Circle, members seeking to vote on finalists for grants are asked to raise and/or donate $2500 annually; Cleveland Colectivo members donate $100 quarterly if they wish to be part of grant-making.

In adopting a financial structure, one popular option is to become a donor-advised fund working under the umbrella of a community foundation.  “We were very lucky to identify a local organization, International Partners in Mission, who could serve as our fiscal agent,” says Judy Wright of Cleveland Colectivo.  “They pass our funds, so that our donations are tax-deductible, no matter who we donate to – individuals, businesses, or organizations.”

Larger giving circles may decide to become nonprofit organizations.  “I feel like I’ve been in a graduate program of philanthropy,” says Wallace of her experiences with Dining for Women.  “Once I understood that this could be a duplicable operation, I saw that we could be a real organization with an infrastructure. I wanted to be professional; I wanted us to be professional in our choices.”  Wallace was able to find an attorney to assist her with the obtaining 501(c)3 status.  This year, Dining for Women has hired an executive director, and 10% of donations support the DFW operations, with the remaining 90% going to a specific organization chosen on a monthly basis.

For all but the largest groups, most giving circle members are directly involved in choosing which organizations to support.  Lee says that Asian Women Giving Circle (AWGC) purposefully found a focus for their grant-giving: “Within our group, many of us had a secret passion for the arts, even though none of us was wealthy enough to be a patron – one woman was a potter; another painted.  So we made as our focus using arts to do activism.”

AWGC has found that awarding small grants can be just as meaningful as larger grants.  “It’s been a great thing, to support women who’ve never gotten funding before, other than from their relatives.”  Lee recalls a $3,000 grant given to Lunar New Year For All, in order to mount an LBGT presence in New York’s Chinese New Year Parade.  “It was a total delight.  My son and I marched with them, it was covered in the press… we had such impact for such a little bit of money.”

Pearl Ji-hyon Park, producer and director of a documentary about a Vietnamese war refugee with bipolar disorder, says that the $10,000 grant from AWGC was “like a lifeline for our project.  It allowed us to edit for nearly four more weeks, during an abysmally difficult financial period.  I was able to hire an editor; it was like a jolt of energy to our film project.”

Pearl Ji-hyon Park’s documentary was partially funded by a grant from Asian Women Giving Circle

Some giving circles choose to make service a part of their focus.  Members of Birmingham Change Fund pledge to commit in three ways: time, talent and treasure.  As BCF has refined their focus to address education, service has involved working side-by-side with grantee organizations in school clean-up and classroom volunteering.

Change: personal, local, global

Though the purpose of giving circles is to support other causes, members often feel personally changed by experiences.  “I never saw myself as a philanthropist before,” says Goodman of Birmingham Change Fund.  “Realizing that my little bit can be combined with others’ little bits – it’s been so empowering.”

For many giving circle members, participation sparks greater involvement in other types of civic engagement.  Goodman laughs as she explains of fellow members of Birmingham Change Fund, “we run in the same circles, we see each other everywhere!” She explains that many members now serve on boards of grantee organizations and belong to other groups like Birmingham Urban League.

Wallace says that as Dining for Women has evolved, she has become even more committed to the organization’s educational role, to expand members’ understanding of the world. “I’ve realized how many women are ignorant of issues related to women in developing countries.  Helping women become more informed on these issues is as important as our actual fund-raising.”  Dining for Women has also developed a travel program that allows members to visit previously funded programs in countries such as Peru and Nepal.

Giving circles’ potential for change — beginning at the personal level and expanding outwards – is well-represented by Birmingham Change Fund’s logo: a patch, meant to evoke the Gee’s Bend Quilters’ Collective.  Goodman explains, “The women who were quilters came together, and each thread helped their community.  They sewed together and made a whole.  It’s the same for us – we all come together, we share – and together, we can make a masterpiece.”

A summary: 5 basics about giving circles

1.         If you wish to start a giving circle, consider turning to your friends with similar interests.

2.         Giving circles allow members a more direct connection to their cause, than if they were to write a check or attend a charity event.

3.         Giving circles range in donation amounts and size, from small and loosely organized to more formalized, structured groups.

4.         Giving circles can provide fulfillment through social contact as well as contribution to a worthy cause.

5.         Some giving circles include service as part of their focus.

Feeling inspired?  Check back soon for our follow-up article, “So You Want To Start a Giving Circle?”

[Feature photo of Dining for Women founder Marsha Wallace in Kenya]