Felicia Herman is Executive Director of The Natan Fund, a foundation supported by young philanthropists that funds innovative Jewish and Israeli nonprofits with budgets under $1.5 million. She can be reached at felicia@natan.org.

Here’s something every Jewish professional and layperson knows: the Jewish community desperately needs new sources of philanthropic capital.

But here’s something most people are just learning: starting a giving circle is a great way to bring new givers into Jewish philanthropy.

These are my top two takeaways from my 5+ years (so far) as the Executive Director of The Natan Fund, a grantmaking foundation currently funded by about 65 young philanthropists that makes grants to emerging Jewish and Israeli nonprofits.

Natan was started in late 2002 by a handful of young Wall Street professionals who wanted to give their money away together. They saw that their peers were starting to think seriously about philanthropy, and that there were few existing vehicles for Jewish giving that matched their interests, fit their values, and gave them a high degree of control over – and engagement with – the allocations process. They weren’t ready to start their own foundations, and they wanted a more hands-on, thoughtful philanthropic experience than they could find elsewhere. So (to oversimplify), they gathered a group of friends and colleagues together, pooled their charitable resources, figured out what they were interested in supporting and set a few (but not many) ground rules, and hung a shingle out saying “free money.” Grant applications poured in. 

Eight annual grantmaking cycles later, Natan has given away over $6 million to 99 new and emerging nonprofit organizations, primarily in North America and Israel. Several hundred people, all under 45(ish), have attended Natan events and contributed to the grant pool. Natan currently makes grants in eight discrete grant areas, including making grants to individual “social entrepreneurs” through an exciting new partnership with Birthright Israel NEXT. 

After participating actively in Natan’s grantmaking process and our complementary calendar of educational, social and service events, Natan members are deeply engaged with Jewish giving, proactively, willingly, and happily giving money and time and struggling thoughtfully with the issues facing the Jewish people. They are thinking more strategically about philanthropy than most of their peers – routinely asking questions like, “What are we trying to achieve? What’s the best way to accomplish those goals? How can I put this money to work most effectively and efficiently?” Natan members are discussing the financial, operational, and programmatic challenges facing Jewish and Israeli nonprofits – and about creative ways to address those problems. And they have a broad understanding of the landscape of Jewish organizations (especially within the Jewish “innovation ecosystem”) and the multiple strategies that emerging nonprofits are using to address the challenges facing the Jewish people. (Although it’s not my topic here, it’s important to note that Natan has also had a tremendous impact on the Jewish community by choosing to focus on funding new and emerging organizations.)

The best news about Natan and its impact on its members is that it’s entirely replicable. Anyone can start a giving circle. Anyone can use this tool to build new cadres of engaged givers for the Jewish community. Research into giving circles confirms that our experience at Natan is endemic to the giving circle phenomenon: giving circles encourage donors to give more, learn more, and make more thoughtful, proactive, strategic decisions – at the same time that they build community (Jewish community, in our case), and take advantage of and strengthen professional and personal networks.

Giving circles are a valuable tool for attracting new philanthropic capital to the Jewish community because they offer givers a fully customizable experience that can often ameliorate the “problems” that turn off many givers (especially young givers) from Jewish giving. They fill the desire that many people have to go beyond check-writing and attending fundraising events and into a more thoughtful engagement with philanthropy. They offer full transparency to members about where their money is going – and the empowering, exhilarating, and humbling experience of grantmaking. Not incidentally, the allocations process builds a sense of fiduciary responsibility to allocate the group’s money responsibly, thoughtfully, efficiently, and as effectively as possible, all of which leads to smarter decision-making.

Giving circles are also a programmatic methodology, if you will, for bringing philanthropically-minded people into a greater engagement with their own Jewish identity and with the issues facing the Jewish people and Israel. Giving circles can be extraordinarily responsive to individual members’ feelings and questions about being Jewish and engaging with Israel. They can meet givers where they are, helping them to give more intelligently to the issues that interest and engage them, while moving them along their Jewish and philanthropic journeys in an engaging, thought-provoking, fun, and empowering way. Simply reading grant applications is educational enough – but complement that process with meeting with grant applicants, educational nights with Jewish leaders and experts in the field, throw in a few programs around Jewish holidays, a Shabbat dinner or two – and your giving circle is now a Jewish community. Philanthropy can be a powerful access point to Jewish life for the unengaged, a way to immediately empower and engage newcomers to the Jewish community.

Yet even as giving circles empower individual givers, they also build respect for collaborative thinking, consensus-building, and partnership – something we know we need more of in the Jewish philanthropic world.

To be sure, there are many pitfalls to avoid in the giving circle model (most importantly: asking too much from nonprofits in return for giving them too little money). And to be sure, I’m guilty of oversimplifying what it takes to start and maintain such a group. (See the Giving Circles page on www.givingforum.org for much more detail on how to set up and manage a group – and then go to www.natan.org for more information on our model and our fantastic grantees.) But the benefits and impact of giving circles are so large, and the need for new philanthropists and philanthropic models in the Jewish community is so great, that I’ll close as I began: YOU should start a giving circle!

See the studies and papers at the Giving Circles site of the Forum of Regional Associations of Grantmakers: