Giving Compass' Take:

• Giving circles are becoming more popular as a way for smaller charitable collectives to raise pooled capital for a predetermined cause. 

• How are giving circles strengthening local communities?

•  Read about the benefits and opportunities of hosting a giving circle. 

If you don’t have a lot of money to donate to a cause, you could give a little bit whenever you can afford it, or you might consider pooling that money with others who have similar interests. That way, your group can give a larger sum all at once, which, for cause groups has a much larger effect: Lots of cash up front is good. It lets your organization dream big and finance ambitious ideas.

The philanthropic term for this kind of group a “giving circle”–a form of charitable collective that is becoming increasingly popular.

These groups all operate a little differently but the general concept is that either everyone’s money goes into a central pot, with its destination determined beforehand, or after several rounds of discussion and voting.

Most of these donors aren’t necessarily looking to support major charities or existing community foundations. They’re finding cause groups, often in their own local communities, that might otherwise be overlooked.

For community groups that may be relying on this new revenue stream, the biggest benefit that giving circles provide may that people tend to stay in them.

Read the full article on giving circles by Ben Paynter at FastCompany.