Types of Funders and Alternative Giving Options

People who want to make charitable gifts have an array of ways to do so.  They can choose from among multiple vehicles – from sending a text message or writing a check, to establishing a donor-advised fund or creating a private foundation.  Whether the gift is of cash, IRA proceeds, appreciated stock or assets like artwork or real estate, donors are increasingly using some combination of tools to make the greatest community impact. 

Below are some of the most common alternatives to giving to the community, whether through an organized funder or an individual donation. 

Foundations and Giving Programs

Community Foundations

Community foundations are typically organized as public charities.  They generally build their endowments through contributions from many donors and distribute funds within a given geographic region, typically focusing on local needs 

Corporate Foundations

Corporate foundations are private foundations that are established by for-profit corporations but are legally separate from the parent corporation.

Company Giving Programs

Charitable giving programs housed within a business; these programs make charitable contributions using the company's pre-tax income

Donor-Advised Funds 

Funds administered by a community foundation or other financial service institution that allow donors to make recommendations regarding how income from their fund is distributed.  The board of directors of the organization where the fund is housed has the ultimate fiduciary responsibility for grant distributions.

Family Foundations

Family foundations are private foundations where the original donor or the donor's family play a significant role in governance (note this is descriptive and not a legal definition of a category of foundations).

Independent Foundations 

Private foundations that are usually endowed by one source, such as an individual's bequest or the conversion of a nonprofit to a for-profit organization.

Operating Foundations 

Private foundations that use most of their income to provide charitable services or programs of their own, rather than making grants to outside organizations.

Private Foundation

Founded by an individual, family or group, a private foundation receives its funding from a single source. Examples of private foundations include family foundations, pass-through foundations, or independant foundations, which could be used to fund the operations of an entity such as a museum or library. The foundation’s creators may appoint themselves, their family members, friends or others to serve on the foundation's board of directors.

Public Foundations

Public foundations - or grantmaking public charities - are nonprofit organizations that operate significant grantmaking programs in addition to their other charitable activities.

 

Alternative Giving Options

Crowdfunding

Crowdfunding is the practice of funding a project or venture by raising small amounts of money from a large number of people, typically via the Internet. Examples include Indiegogo or Kickstarter.

Individual Donors 

Individuals who make direct charitable contributions with no formal administrative structure.

Giving Circles 

Individual donors who pool resources around a specific cause or interest area.

Micro-lending

Providing funding through small loans to people in need through a platform such as KivaZip.

Planned Giving 

A deferred gift, usually made through a will or bequest, that directs funds to a designated philanthropy or charity.

 
Find More By

Resource Type