September 26, 2014

The Rise of Giving Circles

Author National Philanthropic Trust

A new report called Connected to Give put statistics behind a trend that many charitable organizations have been paying attention to in recent years: the popularity of giving circles. Giving circles and crowdfunding allow donors an opportunity to join together in a cause, amplifying their money and message. Unsurprisingly, the report found that giving circles are popular with minorities and younger donors—nearly 40 percent of giving circle donors are under 40 years old.

With a lower entry-point and an immediate connection to a community of donors, giving circles exemplify trends that we know the Next Gen gravitates towards. Other recent discussions about Next Gen giving determined that, in general, they migrate away from institutional affiliations and tend to leverage peer relationships. The identity of a giving circle has more to do with the donors than the recipient. So, even if the giving circle ultimately supports a large charitable institution, it still has a more “grassroots” profile that the Next Gen prefers and allows them to include their friends.

I believe that the full potential of giving crowdfunding will be huge—but it has yet to be realized. As the Next Gen becomes wealthier, it will be interesting to see if the trends of social, community-oriented giving stick.