One Percent Foundation Unleashes Next Generation of Philanthropists

A modern twist on old-fashioned giving circles takes microphilanthropy macro.

This month, GOOD is challenging you to tiptoe into the world of philanthropy with some small experiments in giving. Lana Volftsun makes that her full-time job as the head of the One Percent Foundation, an online giving circle designed to train the next generation of philanthropists.

“We operate under the idea that you don’t have to be high-net-worth to make an impact on the world,” Volftsun says. “Most young people say, ‘When I make money, then I’ll be a philanthropist,’ and we’re saying, ‘You can actually start being a philanthropist today, right now.’”

The One Percent Foundation is an online giving circle that stretches the impact of the micro-donor by pooling small gifts and letting everyone collectively choose where they go. Volftsun adds in some training, education, and a clever system of community management to cultivate the habit of methodical, well-considered giving instead of just a check here or there or some change in the Salvation Army bucket.

The foundation targets a national group of what Volftsun calls 'millenials-plus,' 18-39 year-olds who want to donate more regularly and seriously. That's a somewhat new demographic for this method of philanthropy. Giving circles are traditionally the province of older women’s groups, and usually operate with a dozen or so people at the hyper-local level, according to a study by the Forum of Regional Associations of Grantmakers [PDF]. The One Percent Foundation takes the idea online, targets the young, and—like most forward-looking nonprofits these days—makes the interaction social.

Here’s how it works: Members to pledge give 1 percent of their income to charity each year. If they give through the foundation, as about 300 are doing, their money is pooled into two grants each quarter. This boosts the bang for the buck for those small donors. “People who are giving $20 to $100 per month are suddenly helping to give away $100,000 per year,” Volftsun says.

Any member can nominate organizations for the group's consideration, and every member gets an equal vote. The money is always given as unrestricted funds to the charities. The foundation doesn’t take a cut of the donations, either; Operating expenses are paid separately out of money raised from other sources.

The One Percent Foundation launched in 2007 as a giving circle of about 20 friends. Somewhere along the way, as the members moved around the country and new friends in new cities began joining, the concept ballooned beyond its humble origins. By 2009, the initial young donors found themselves with a big idea on their hands that was resonating beyond their personal Facebook circles. That sparked a transition to a formal nonprofit organization aimed at making philanthropy accessible to millenials. Earlier this year, Volftsun was hired as the group's first paid staffer, to bring the opportunity to a wider audience.

The real potential of the model, Volftsun says, is converting the members from arms-length givers to calculating donors. “A lot of young people want to be involved in philanthropy, but they don’t know which nonprofits are doing good work. They want to do due diligence but don’t know how,” she says. In short, “people want to learn how to give strategically.”

Every quarter, between five and 10 different members form a working group to take the lead on finding the right charity. The foundation provides training on how to assess nonprofits and read financial statements, and even philosophical guidance on theories of change. Through a partnership with Philanthropedia, a charity rating organization, the Foundation arranges consultations with issue area experts to field questions from the budding philanthropists.

"It’s an opportunity to have more of an active role in philanthropy,” says 34-year-old nonprofit worker Abby Flottemesch. As a member of a working group, she enjoyed learning about the back end of giving. “A lot of people, when they donate, may not look at the organizational structure” of a charity, or the percent of the budget that goes to overhead spending instead of programming, she says. “It broadens your view on how nonprofits operate,” she added.

Typically, Volftsun says, people who join the One Percent Foundation—or any giving circle—start to learn about innovative organizations, notice effective practices they want to support, or find a particular issue that resonates. “They start to figure out their passions,” she says. Many of them end up giving outside of the One Percent Foundation, she says, which is part of the point: to set future philanthropists free on the giving world with the tools and motivation to be smart, lifelong donors.

That’s why the next step for Volftsun is to let people use the Foundation's website and tools to create new online giving circles. The circles can focus on any cause—from alumni support, to niche concerns within larger movements, to causes in one's own backyard. The option to build your own giving circle through the One Percent Foundation kicks off next year.

Pledge to give one percent.

Image courtesy of the One Percent Foundation.

Julian Meehan

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