It’s been suggested that the concept of “giving circles” could become a new method of fundraising for cultural institutions, with the collective support method “rebuilding philanthropy from the ground up”.

The concept of a giving circle is based around a group of people deciding on which organisations they want to support as a collective, engaging in discussions and making decisions based on group consensus, with circles taking direct responsibility for grant making and running the group.

“In a sense, they form a more democratic, grassroots-based, bottom-up alternative to conventional top-down philanthropy such as a foundation or an NGO.” says Angela Eikenberry, research professor at the University of Nebraska where she specialises in philanthropy, voluntary associations and nonprofits.

Eikenberry, who has been researching the giving circle concept in both the US and the UK for the last decade, suggests that at a time when some are criticising conventional philanthropy for being out of touch on a grassroots level and overly hierarchical, giving circles could “provide some of the building blocks to a healthier and more effective system of funding for social change.”

The largest giving circle globally is The Funding Network (TFN), which has affiliates in both Europe and North America who have collectively raised £8m (US$11.5m, €10.3m) over a 14-year-period since 2002 for 1,200 projects. TFN holds regular live crowdfunding events “like a friendly Dragon’s Den” where members and guests can discover and engage with innovative charitable projects through the giving circle model. A selection committee chooses three to five organisations or projects for each event, with members pledging donations during an auction-like session.

Speaking on openDemocracy, Eikenberry says that diversity within giving circles means they are significantly more likely to support women and ethnic and minority groups than other donors, also adding that the model provides opportunities for democratic participation through agenda setting, decision-making and face-to-face debates.

“The challenge,” said Eikenberry, “is to move beyond encouraging more giving to enhancing the ability and willingness of donors to engage in deeper efforts to change themselves and the structures that perpetuate poverty, inequality, violence and discrimination.”

For more from Angela Eikenberry and her work with giving circles, click here.