It's a great video from a great series (their videos on narrative are fantastic). And this one has a bunch of applications to improv.
One aspect I want to consider, when thinking about this "magic circle" is how easily it can be broken by small technical things. Mistakes as tiny as a messed up music cue, or lights on the audience, or a show announcement that gets things wrong, or your team doesn't know who's introducing: these things all put a little tilt on the show for the audience. When the little stuff is going wrong people start to worry about the quality of... well... everything. It cracks the circle a bit.
Will these things turn a good show into a bad one? Of course not. But they don't serve to give your show the best chance it can have.
So practice the little things that set up and close out your show: who gets the suggestion, what you're all wearing [if you have a dress code], how you go on and off stage, who talks when. Talk with your tech people. Walk through the lighting and music cues, give them a cheat sheet, have them do a dry run before the house opens.
And be sure to thank them.
Professionalism does matter. It keeps the circle strong: keeping the crowd calm and ready to enjoy the show.
Show that you care about it and they'll care about it.
