The Many Ways To Give

Philanthropy flows from a loving heart, not an overstuffed

pocketbook. - Douglas M. Lawson

Definitions of Common Vehicles for Giving

Bequests: Leaving a stated sum of money or a percentage of your estate to nonprofits, family, or friends by naming them in your will.

Community Development Financial Instituition (CDFI): A lending institution whose mission is to reinvest in targeted, underserved communities.

Definitions cont.

Community Foundation: A public foundation that receives donations from a broad base and whose charter is to serve its community or issue-specific population.

Nearly 1000 throughout the United States. Vary in length of time in existence, asset base, level of service

to donors, political orientation, and level of community involvement.

Definitions cont.

Community-Based Foundation or Federation: A public foundation or workplace-giving alliance of organizations that receives donations from a broad base of donors.

Aim to identify problems in their communities and then to address or solve them or advocate for changes together.

Impact of funds is to democratize philanthropy as well as to share power in decision making and community building.

Definitions cont.

Corporate Foundations: A private foundation established by a business or corporation as a means of carrying systematic programs of charitable giving.

Donor Circle or Giving Circle: Pooled fund where donors make a commitment of 1-5 years to share in studying, donating funds, and becoming advocates around a specific issue, region, or population.

Definitions cont.

Donor-Advised Fund: A fund established by an individual donor or group of donors at an existing community foundation, public foundation, or federation, or through philanthropic program at a financial service institution.

E-Philanthropy: Online nonprofit and philanthropic activity, including Web-cased giving, volunteering, advocacy, and organizing.

Definitions cont.

Family Foundation: A private foundation involving family, extended family, and sometimes community advisors.

For-Benefit Corporations: A new wave of companies that have been formed, in the spirit of Paul Newman’s company, Newman’s Own, for the primary purpose of generating profits to a contributed to nonprofits as grants.

Definitions cont.

Pooled Fund: Individuals pooling any amount of money together to gain philanthropic leverage.

Private Foundation: An organization whose function is to give away money; generally supported by a small number of private donations.

Definitions cont.

Supporting Foundation: A tax-exempt organization, usually with at least $10 million in assets, that is closely tied to at least one other public charity.

Trusts: A variety of vehicles that can offer a lifetime income or tax advantages to you, your family, or your favorite charity.

Definitions cont.

Venture Philanthropy: The application of the investment and management practices of venture capitalism to philanthropic giving.

Online giving

New Opportunities in Philanthropy creating a vehicle for better-connected and better-informed philanthropy.

The Internet is a connecting resource where people can join funds, talents, and knowledge; or an information portal on good giving.

Online Resources

www.pledgebank.com A place to challenge others to join in an activity or make

a gift conditional on the participation of a set number of others.

www.dropcash.com A way to post a fundraising campaign anywhere online.

Online Resources

www.10over100.org Created by Internet entrepreneurs as a way to commit

giving and to challenge peers. The site offers a place where a donor can pledge to give 10% of income over $100,000.

www.donorleaders.org Offers information about and links to donor networks for

high-end donors.

Online Resources

www.newdea.com A Web site for high-end donors to organize and

evaluate

giving.

www.networkforgood.org Information and connection to opportunities to volunteer.

Online Resources

www.onebrick.org Helps connect local volunteers to local projects,

rewarding volunteers with social activities.

www.CharityFocus.org An organization of and for volunteers, connects people

to opportunities to serve, especially opportunities related to technology.

Exercise 8.1Giving Methods

5–10 minutes

I have usedthis method

I wantinformation on

this method

Notapplicable

to me or not interested

Financial Gifts

Written a check

Given cash

Donated by credit card

Given stock

Given real estate or other holdings

Setup charitable estate planning

Designated insurance policies or IRAs to a nonprofit beneficiary

Other: ___________________________

Non-Financial Gifts

Given house or space for fundraising events, activists’ or artists’ retreats, or issues briefings

Written a letter or placed a phone call of recommendation (leverage)

Given equipment

Given skills

Other: ___________________________

Decision Making

By self

With partner

With family (all ages)

With groups of other people from similar incomes

With mixed-income group

With group of co-workers or friends

Gave decision-making power to group of professionals in the field, or representatives of constituency groups or activists

Exercise 8.1Giving Methods, Cont’d

I have usedthis method

I wantinformation on

this method

Notapplicable

to me or not interested

Gave decision-making power to a staff member, program advisor

Gave decision-making power to someone else to decide

Other: ___________________________

Mechanism

Public community foundation or federation

Donor-advised fund

Donor circle

Giving circle

Online donation

Venture philanthropic fund

Loan to a nonprofit or individual

Investment in a community loan or micro-enterprise fund

As part of a mixed group of low-income and wealthy activists

Workplace or payroll deduction

Family foundation

Supporting foundation

Other: ___________________________

Designation of Donations

Operating expenses

Capital expenses (such as for building or equipment)

Grantmaking funds

Leadership sabbaticals

Endowment gifts

Matching or challenge gifts

Technical assistance

Scholarships

Designation of Donations

Exercise 8.1Giving Methods, Cont’d

I have usedthis method

I wantinformation on

this method

Notapplicable

to me or not interested

Loans

Existing debt reduction

Time frame

One-year gift

Multiyear gift

Gift with no amount of time attached

Planned gift (during lifetime or upon death)

Reflection:

1.What is your analysis of your methods of giving?

2.What methods do you want to learn more about?

3.What information do you need and who or what resource can best answer your questions?

Philanthropic Conversations

Internet provides a wealth of knowledge from and for foundations, nonprofits, and other organizations involved in philanthropy.

Blogs offer individuals a voice for sharing their perspective on giving and causes.

Conversation Resources

www.worldchanging.com Share ideas and information about making the world a

better place.

www.Idealist.org Information and a connecting space for volunteers and

nonprofits

www.nextbillion.net Site to identify and discuss sustainable business models

that address the needs of the world’s poorest citizens.

Conversation Resources

www.gifthub.org Prominent blog on developing a conversation about a

wide range of issues within philanthropy.

www.philanthromedia.org Offers discussion for the high net worth donor and

professional philanthropist and advisors.

www.gayleroberts.com/blog Offers discussions about fundraising for nonprofits.

Conversation Resources

Philanthropy.blogspot.com Offers “provocations on the future of philanthropy.”

www.thephilanthropiceneterprise.org Seeks to understand “the role of voluntary action and

philanthropy.”

www.onphilanthropy.com A global resource for nonprofit professionals.

www.globalfundforwomen.org A site about women’s philanthropy worldwide.

Virtual Worlds, Real Philanthropy

Virtual world avaters interact with each other in a wide range of activities.

Nonprofits open virtual doors and hold fundraising events.

www.secondlife.com Offers a meeting place for people striving to create a better

world. American Cancer Society holds virtual Relays for Life in the

world of Second life.

Workplace Giving

Many donors participate in workplace giving campaigns whereby charitable donations are deducted regularly from employees’ paychecks.

United Way has had the largest and best-known workplace fundraising appeal.

Workplace Giving

Community based workplace funds have started with 50 charitable federations and funds serving more than 2,000 nonprofits nationwide.

According to Giving at Work 2003, by the National Committee on Responsive Philanthropy, employee contributions to the progressive community-based funds made up 11% of pledge dollars from traditional donors in American workplace from 1996- 2001.

Giving Circles and Donor Circles

New models of giving that has taken off.

Both involve groups of people pooling philanthropic dollars and making joint decisions on the use of those funds. The difference is in institutional affliation.

Giving Circles

Giving Circles usually have no institutional affiliation.

They consist of groups of people with some common interests and values who seek to make philanthropic gifts through collective giving.

Giving Circles

A social investment club with the funds invested in nonprofits have become a popular community-building and collaborative learning experience.

By acting collectively, giving circle members have the chance to infuse the nonprofits of their choice with financial and intellectual capital, resources, and contacts.

Giving Circles cont.

Members share the following desires: Leverage the impact of their charitable contributions with

shared expertise and volunteerism. Connect meaningfully with communities and causes

they acre about. Participate in a social network of people who share

similar interests and values. Learn more about philanthropy as a vehicle for social

change.

Giving Circles Advantages

1. Pooled dollars invested toward a key issue can have a far greater impact than smaller individual gifts

2. Collective “know-how” of a group adds value and impact to volunteerism and charitable investments.

3. Creating partnerships with a smaller number of charities creates a deeper level of involvement and gives better chance to gauge your return on investment.

Common Elements of Giving Circles

Membership is broad, diverse, and inclusive. Each member contributes money at least

once a year. Money is pooled and members determine

how it will be distributed. Money is used to help address specific

community or institutional needs.

Common Elements of Giving Circles

Educational opportunities are available to learn more about philanthropy and finance.

Memberships are proactive and participatory. There is a minimum of recognition other than

personal thanks. Volunteers provide most of the circles

support.

Donor Circles

Ms. Foundation for Women and the Global Fund for Women pioneered the model of donor circles in the 1990s.

Programs developed by established giving institutions, often for the benefit of their grantees and their own programs.

Donor Circles cont.

Significant pools of money for specific projects or interests areas with gifts of $5,000- $1 million each from donors are created by organizations.

Generally consist of 10-25 donors or their representatives who meet 3 to 5 times a year to deepen partnerships and collective knowledge among themselves, staff, and advisors.

Donor-Advised Funds

Offer an alternative to establishing your own private foundation.

Enables a donor to make an outright, irrevocable contribution of cash or securities to an organization that acts as fiscal manager of the fund and distributes the fund’s income or assets to nonprofits.

Donor-Advised Funds cont.

Available through public foundations, Jewish Federations, and United Way.

More recently financial-service companies have developed donor-advised charitable giving programs..

Fidelity, Vanguard, Schwab, and American Express Customer’s dollars can be easily transferred within an

institution for charitable purposes.

Advantages of Donor-Advised Funds

Easy to establish. No need to involve your own attorney. Parent organizations handle administration of the

fund. Charitable deductions can be made as soon as the

donation to the fund is made. No capital gains tax is imposed on long-term

appreciated securities donated to these funds.

Advantages of Donor-Advised Funds

Low management costs Additional gifts and investment earnings and growth

increases the fund’s balance. Can carry on donors’ charitable values beyond their

lifetime. Financial and programmatic reports are informative

and easy to read. Donor education programs or site visits are

sometimes provided for fund holders.

Venture Philanthropy

Applies the principles and practices of venture capitalism to the nonprofit sector.

Long term partnership and strategic management assistance leverages and augments financial investments.

Venture Philanthropy Characteristics

Donors refer to them selves as investors and have high investor engagement.

Investors initiate projects by convening people and resources as well responding to requests for funding.

Investment is long term. Investors act as managing partners. Investors require ongoing accountability. Investors provide cash, expertise, and problem solving, and

monitor projects. Investors plan their exit or transition from partnership from the

beginning.

Venture Philanthropists

Refer to nonprofit partners in whom they invest as social entrepreneurs.

Nonprofit professionals creating sustainable profit models for organizations within a business environment.

Attempts to counter the undercapitalization of infrastructure that leaves nonprofits at a state of struggle.

Nonprofit Venture Forums

New model of showcasing nonprofit groups that you may want to investigate replicating in your community.

www.craigslist.org Connected local nonprofits with philanthropists who

wanted to learn more and become involved.

Venture Forums

Generated funding and resources for small, social change organizations and educated donors about new groups.

Venture fairs for nonprofits to present their soluntions for community issues.

Community-Based Philanthropy

The 20th century viewed philanthropic giving as expanded from wealthy industrialists and business owners seeking to balance their amassed wealth with public charity to incorporate more broad-based involvement.

Grant making, networking, community organizing are common in community based philanthropies.

1920s

United Way began First large organization to pool donors’ funds and

distribute them to community projects. Following more traditional community foundations were

created in particular geographic areas. Community Foundations attracted unrestricted

donations, such as distributing funds to established health, human services, arts, and education institutions.

1960s & 1970s

Beginning of more demographic form of organized philanthropy emerged.

Women, people of color, and others whose issues and organizations were not being supported by traditional foundations and the United Way forged new ground by creating community-based public foundations.

Mission: support grassroots organizations working specifically with societal change.

Late 1970s

Funding Exchange: (www.fex.org) gathered many alternative funds that were committed to providing support to grassroots organizing locally, nationally, and internationally under one umbrella and sought to strengthen their services and capacities.

Democratic governance structure ensure that decision-making bodies are representative of the communities served by the foundations’ programs.

Late 1990s

Changemakers was founded to help promote community-based philanthropy efforts.

Providing guidance for the field of community-based philanthropy.

Changemakers

Set of values derived from and defining the work of community-based philanthropy.

– Accountable: practicing honesty and transparency and answers to a wider

community.– Compassionate:

being motivated to uplift all beings.– Inclusive:

valuing all people equally and treating people with respect without regard to race, culture, religion, language, immigration history, age, class, gender, or disabilities.

Changemakers cont.

– Democratic: involving a broad range of constiuencies in decision-

making processes.

– Strategic: addressing root causes of social, economic, and

environmental problems, often with innovative and creative approaches.

– Collaborative: working in partnership with like-minded organizations

and building bridges between donors and grantees.

Changemakers cont.

“ Community-based social change philanthropy is about trusting that people in a community can develop the best solutions to the social and economic challenges they face.”

- Changemakers

Early 2000s

The family and community-based public foundations had grown to 200+ organizations encompassing a broad range of funds.