by Shelby Zitelman

The past year’s financial crisis calls for a reevaluation of how we fund our organizations. In the face of a reality where reputable Jewish foundations and endowments have lost hundreds of millions of dollars, we have been reintroduced to the notion that the collective power of individuals has the potential to sustain our community’s needs.

Tapping this collective potential are giving circles, defined as a group of people who pool funds and in doing so increase their impact on charitable causes. According to a May 2009 study, “The Impact of Giving Together,” by the Forum of Regional Association of Grantmakers, the University of Nebraska at Omaha, and the Center on Philanthropy at Indiana University, it is estimated that there are about 600 giving circles around the United States that have given more than $100 million and have engaged at least 12,000 people over the course of their existence.

Of these, Jewish giving circles have a variety of approaches to their giving activities based on membership and the groups’ funding strategies. Some only donate to early stage projects. Others only assess more established Jewish organizations. There are groups that focus on engaging alumni from existing Jewish networks, while other circles provide educational resources for established private foundations.

There are also giving circles that operate very similarly to foundations – taking the best from both. Becca Linden, PresenTense Fellow 2008, combined the giving circle model with a family foundation to enable the individuals in her extended family to increase their impact through the Lifchitz Family Philanthropy and “strengthen the connection of individuals to their values, to others in the family, and honor family ancestors.” Generally, giving circles are found to have a strong impact on their communities since they not only donate a significant amount of capital to worthy nonprofit organizations, but also positively influence their participants.

In the “Impact of Giving Together” survey, the researchers discovered that giving circles influence members to give more – and more strategically, and to become highly engaged in the community. Their participation also increases members’ knowledge about philanthropy, nonprofits, and the community.
More specifically, by actively engaging in conversation about funding options, individuals are empowered by the group’s decision-making process. They are challenged on previous giving assumptions, and are frequently exposed to opportunities that may not have been personally considered. Participants learn from one another’s skills and opinions, and consequently exchange in an educational experience.

“There is a huge amount of learning that takes place through the application review process,” explains Jos Thalheimer, one of the founders of the Slingshot Fund. “We learn what is out there, how the sector operates, good funding practices, and in the end I learn a lot from giving with my peers about how they see the world.”

This type of personal realization is an important, and conscious, result of giving circles. As Felicia Herman, Executive Director of Natan, points out, “Natan is really as much as about the philanthropists as the organizations we are giving to. We are also focused on the self-actualization of the giver, and ideally we want them to become the best givers they can be.”

Members also have the chance to get involved with the organizations that the group supports. Julie Bram, current cochair of the Jewish Venture Philanthropy Fund in Los Angeles, notes that members of JVPFLA have become more involved in their community as a result of fund participation. “Being part of the fund has led to my and other board members’ personal involvement in many of the projects. One of our partners is the national chair of Jewish Family and Life Media, and several of us were asked to join other boards and advisory committees of the organizations that we funded.”

Further, Jewishly-oriented giving circles provide an opportunity for participants to engage in dialogue about their giving strategies, and the role that such the Jewish philanthropic concept tzedakah plays in the larger communal framework. Giving circles tend to emphasize the importance of collective allocation decisions beyond individuals’ charitable preferences.

The impact of the giving circle model is extensive. Not only are needy organizations receiving crucial financial support, but participants are educated about the methods of strategic giving. And in a philanthropic world where the Jewish community is concerned about who will provide the necessary philanthropic support, giving circles are incredible opportunities to re-ignite the spirit of communal tzedakah. By creating relevant opportunities to empower the individual and make his/her contribution meaningful, we will ensure that Jewish giving continues with the values that have been handed down to us from generations past.

Shelby Zitelman is founder of The Level8 Network, a philanthropy fund for young professionals, and is a 2009 PresenTense Fellow.

This post is from the just-released PresenTense Philanthropy issue; you can also subscribe to PresenTense Magazine and receive this, and future issues, delivered directly to you.