3 Variants of the Giving Circle

26 07 2009

By: Hannah Kim

For clarification, I would like to distinguish between three variants of the giving circle that are at the centre of our Homeless Sponsorship Model.

Investment Giving Circles

As explained in previous posts, the 5 investors in this type of giving circle pool their dollars for a down payment on a property unit that is rented to 2 – 3 homeless clients. The collective rent paid by the tenants (using their social assistance housing allowance of $375/month per person) will cover the bare minimum monthly costs, such as mortgage payments and property taxes. Investors receive a moderate ROI as property is an appreciating asset. Potential additional incentives to investors include lower mortgage rate from a local bank, lower taxes and utilities fees from government, and local businesses’ donations of services and in-kind goods for repairing and refurbishing the housing unit at regular intervals.

1) Silent Investors Giving Circle: The investors contribute their dollars towards the down payment, and take a hands-off approach in terms of any interaction with the homeless clients.

2) Hands-On Investors Giving Circle: Members of this giving circle offer their time, talents and skills in addition to capital funds. They may interact with the homeless clients, providing companionship and mentorship; they may bring their own innovative ideas to the Homeless Sponsorship Model using their expertise. This type of giving circle is also a great way for members to network with like-minded investors by volunteering as a group.

3) Donation-Based Giving Circle

Members of this giving circle pool funds to simply subsidize the rent for a homeless client for a designated period of time. This means that we must find an existing landlord who is willing to rent empty space (e.g. basement suite, apartment suite) to homeless people.

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