Four times a year in Montgomery County, a group of women get together, each bringing $100 and a desire to make a difference. Within less than an hour, one local nonprofit organization will receive thousands of dollars in new funding and a room full of new and returning supporters. This is a giving circle.
“It’s been very rewarding to see what’s what we’ve done,” said Linda Mathuran, founder of local giving circle 100 Women Who Care Lower Montgomery. “I had no clue in the beginning what it was going to lead to.”
Giving circles have risen in popularity as a more community-focused type of philanthropy where a group of people pool their funds and donate periodically to nonprofits of their choosing.
According to a report published by The Association of Baltimore Area Grantmakers and the Maryland Philanthropy Network, during the late 1990s giving circles emerged as a higher-engagement form of philanthropy. Donors who wanted to do more than simply write a check were looking for new ways to ensure their contributions made maximum impact.
What emerged from this need was two strategies. One was venture philanthropy. The other was giving circles. The latter trend was especially popular among women, African Americans and younger donors.
MOCO’s Giving Circles
Montgomery County has a wide variety of giving circles that focus on issues ranging from women’s issues to teen philanthropy to teachers.
Mathuran started 100 Women Who Care Lower Montgomery more than 10 years ago. She says the group started with 30 members. Today, it has grown to over 100 members, contributing more than $350,000 in grants. Most donations go to groups that provide items such as twin beds for underprivileged kids and backpacks filled with personal items for foster children.
“It makes a huge difference when a charity that is fairly new and needs the money … [and] we give this kind of money,” said Mathuran.
Mathuran added that she has made donations to charities her entire life, but pooling the money of her friends and family together to make larger donations “makes a big difference.”
“I heard about [giving circles] and I just liked the idea of it,” Mathuran explained. “I tried to find one in our area, and I didn’t find one in our area, but what I did find was that there’s hundreds of these around the country and even in the world. So, through a website that they had out there, I contacted somebody, and they encouraged me to start it.”
How it works
According to Philanthropy Together, today there are an estimated 4,000 active giving circles worldwide, 60% of which are women-centered.
Giving circles differ from typical charities or nonprofits. Pooling funds together into a collective fund allows community members to make larger contributions to the organizations of their choosing.
Mathuran’s group, like most other giving circles, has its members pay a sum of money regularly. For some giving circles it is yearly. For 100 Women Who Care Lower Montgomery, it is quarterly. “Everybody has to commit to giving $100 four times a year to the charity that is selected by the group,” said Mathuran.
As for deciding where the money goes, different giving circles have different procedures, but there are always rules and a democratic process for choosing the recipients.
For 100 Women Who Care Lower Montgomery, Mathuran said “it’s simple.” The charity has to be a local organization – meaning the money has to stay within Montgomery County – and for Mathuran’s giving circle, the organization needs to be a non-profit, a 501(c)3.
Some giving circles do not require the organization to be a non-profit. They also may tightly focus their donations to women’s groups, to education, or something else.
Mathuran’s group has non-profit representatives make their bids for the group’s donation in person. “What happens is the charities present, they have seven minutes to present, followed by question and answers. Members ask their questions, they get the information, and they go from there,” explained Mathuran. “A lot of times, the charities will come in with a specific goal, an item that they want. But really, it’s up to what the members see is important.”
Mathuran added that 100 Women Who Care Lower Montgomery’s donations are matched by the Richard Schulze Family Foundation.
The process and the results can be far more gratifying for donors than simply writing a check.
Additionally, most giving circles stay involved with a grantee after the money is awarded, creating a more involved philanthropic experience for the donors. It is typical for giving circles to appoint liaisons to each charity that receives a donation to offer hands-on assistance as needed.
Once an organization or charity receives a grant, depending on the giving circle, they typically are required to wait at least a year before being able to apply for another. For 100 Women Who Care Lower Montgomery, they must wait three years.
For Mathuran, being involved with a giving circle has been deeply gratifying.
“One of the reasons why I started is I was looking for something to do, as far as maybe giving back a little more,” said Mathuran. “And I thought, well, this is a great way to hear about the charities. I’m just amazed how many charities that need the help and some of the people who create them. I’m so impressed.”
