Crowdfunding

Removing the glass wall – crowdfunding for charities

Written by: Andy Hamflett
Posted: 18th December 2012

Like most people interested in technology-enabled giving, we welcomed the Autumn statement’s commitment to review Gift Aid – specifically in light of the increasing profile of digital giving. We’re as hopeful as any on this. One of the three key recommendations from the Giving Paper Action Group we convened earlier in the year for the Cabinet Office was exactly that we needed to discuss this in greater detail, so we look forward to working with others to assist with the investigation.

However, structural issues – important as they are – are only one barrier. The ‘what’ and ‘how’ of digital giving also needs to be addressed, and we’ve had good opportunities to reflect on this over the past couple of weeks. 

Nesta recently published a report on crowdfunding that mentioned that in 2011, crowdfunders raised $1.5 billion, mostly in the US, to finance over amillion projects, which ranged from start-ups to community projects, and from new video games to scientific research. So it’s clear that one platform for giving is certainly moving in the right direction – even if those top-line figures cut across many sectors, not just donating to charities or causes.

We had further opportunities to kick around some thoughts here when we partnered with the Centre for Giving and Philanthropy to welcome Adam Chapnick from Indiegogo to an event we hosted in Somerset House. As well as wanting to allow our assembled audience to hear from the world’s first crowdfunding platform about the ‘what’ and ‘how’ of this platform, we were more interested in discussing how charities and arts organisations might usefully take advantage of these opportunities. The debate certainly provided food for thought.

Adam provided an uplifting overview of the principles and some high profile examples of success on Indiegogo, but it was not all just a celebration of potential.

While genuinely optimistic about the potential for smaller organisations to use tech to help them in new ways, Karl Wilding from NCVO was keen to sound words of caution, in that we are still very much in the foothills of adopting technology for fundraising in the UK.  

Clearly there’s a great new platform here that is easy to understand and engage with, but it’s not an automatic route to success. To paraphrase Adam, you don’t put your campaign online at night, and the elves have sorted it all by the morning.

While this principle appears to have been jumped upon by tech start-ups, theatre producers, game developers and film producers, there appears to be something more of a glass wall between charities and them feeling able to touch and make use of the potential of crowdfunding. So why is that?

Some old faithful barriers are still there – lack of resources to invest in developing a campaign, not having the right skills to do it well, and wariness about having the reach or capacity to point people to any crowdfunding campaign they may get online.

At the end of the evening I was left feeling that these weren’t necessarily definitive statements of weakness, but perhaps more about people not really knowing how much is enough: How much time does it take to set up a good crowdfunding campaign? How skilled a storyteller do you need to be? How accomplished do you need to be in utilising photography and film? In short, what is it that those elves do? There is therefore perhaps a fairly straightforward task there to demystify this a little bit and make clear the time and skills that may be needed to tackle crowdfunding well.

As Cathy Pharaoah from the Centre for Giving and Philanthropy reflected, there does appear to be a big gap between where people are and where they might get to in relation to the potential of crowdfunding for philanthropic giving. And in order to reduce that gap, charities are perhaps going to have look at these functionalities with ‘different glasses’.

For example, as well as interrogating the ‘newness’ of emerging platforms, it’s probably also important to pinpoint what is comfortingly familiar – and there is much about crowdfunding that should grow out of existing skills within charities. Most notably, perhaps, the most successful crowdfunding campaigns are built on emotion resonance – be that excitement about a new product or the heartstring-pull of seeing someone inneed.Most fundraising charities are well placed to draw on emotional stories, so one of the challenges is how to do this successfully within this new medium. There are many ways to tell a story – what’s right for this approach, and how can you get people telling the story for you?

As well as investigating skills and capacity, we probably need two or three bullet-proof success stories in the UK of where charitieshave used the platform successfully, so we’ll see what emerges in the next few months.  

We’re continuing to work with our partners from the evening to work out what might help push things further in the right direction. Because crowdfunding may well be a valuable gift for charitable organisations, but it seems they need a bit more help unwrapping it.


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