Over the past two months, our Featured Topics have focused on how to spread the word your work and build a network of supporters, and how to leverage insights to grow your project through a mentoring relationship. This month, we want to expand on these and look at one of the most critical components to launching a social venture: raising startup capital.
Big Ideas Summary
Traditional models of raising capital through one-time, large investments, angel investors or bank loans are being innovated on through the use of technology and social media. Why not tap into the vast pool of capital within your network of supporters? Crowdfunding is when networks of individuals use the Internet to pool their money to support efforts by people or organizations, and it has become a viable and popular way of raising capital for businesses and social ventures. In 2012 alone, crowdfunding raised 2.7 billion USD amounting to an 81% increase from 2011. This Featured Topic focuses on strategies to run successful, online crowdfunding campaigns that will help you raise the necessary funds you need to start up and launch your social venture.
Global Giving
Global Giving is a giving portal designed to help donors fund and follow the dreams of people around the world. This unique online marketplace allows donors to support specific projects that enable people to realize their full potential. The portal goes beyond organizational or program-level giving by connecting donors to the tangible results of their contributions - individual faces, specific asks, or what we call microprojects.
For another great way to run online, crowd-funded fundraising campaigns, check out CauseVox!
Books
The Crowdfunding Revolution: How to Raise Venture Capital Using Social Media explains raising investment capital by using social media and new technologies to draw small sums of money from an almost countless number of sources. This book provides valuable information to make your crowdfunding campaigns more efficient and productive, including proven methods for marketing to the crowd, setting clear objectives, building a crowdfunding team, and communicating in a way that inspires action. Check out this great book review and preview the first chapter of the book here
Crowdfunding: How to run a successful campaign provides resources, tips and tricks to make your crowdfunding campaign a success. With a list of global crowdfunding sites, this book provides a valuable resources for anyone considering a campaign.
Articles
This Expert Advice on Crowdfunding is a Q&A hosted by the Guardian with leaders from crowdfunding organizations like Indiegogo and Peoplefund.it. For charities and other social ventures, crowdfunding is a great vehicle to source project financing. However, a proper strategy must be in place in order for crowdfunding to be effective. Learn more about how crowdfunding could work for your campaign, the potential difficulties of running a campaign without adequate planning and different approaches to consider.
The 12 Secrets for Success in Crowdfunding for Social Entrepreneurs is an article for Forbes author Devin Thorpe, who polled a variety of social entrepreneurs to understand what tactics they undertook to fundraise for their ventures. One key insight that surfaced across all those surveyed was that while it is difficult to predict outcomes, having a big and fast start was key to the long-term success of campaigns. In a follow-up article, Devin Thorpe goes onto highlight 4 Crowdfunding Mistakes for Social Entrepreneurs to Avoid. As he notes, “crowdfunding isn’t a magic well of money. It’s just a new way to raise it”. This article highlights some common mistakes, including lack of planning, underinvestment in marketing, unrealistic expectations, and not actively soliciting small donation pledges. Not to fear – this article also addresses ways to avoid these common mistakes and make your crowdfunding campaign speak to the right audiences.
As these statistics show, social media plays an important role in reaching out to our networks to both learn more and donate towards social ventures. Crowdfunding platform Global Giving posed a challenge to small non-profits to earn a permanent spot on the website by raising at least $4000 online from 50 individual donors in three weeks, and an additional $6000.00 bonuses for out-fundraising the 70 other participating organizations. Check out how a small non-profit used social media and crowd sourcing to win the Global Giving fundraising challenge. To learn more about how to effectively use social media, here are 3 social media tips for a successful crowdfunding campaign.
Get inspired by some great social innovators who used crowdfunding to launch their world-changing ideas. In the eBook entitled Let's Start Some Good: What's Next in 2012 10 social entrepreneurs talk about what they learned from their first year of crowdfunding, share some helpful tips, and outline their plans and predictions for the next year.
Check out this blogpost by Shareable on How To Run a Successful Crowdfunding Campaign This article lays out some of the most important considerations you’ll need to take into account if you want to build your crowd, get them engaged, and drive them to a rewarding conclusion. Be sure to also check out Sharable’s other blogs as part of a weeklong series on crowdfunding, Crowdfunding Nation.
The India Innovation Institute at the University of Toronto’s Munk School of Global Affairs and Rotman School of Management conducted a research study entitled Is Crowdfunding Right for You? This study includes an overview of strategies on how to leverage crowdfunding for business and case studies of campaigns conducted by both for-profit and non-profit ventures. It concludes with a checklist and step-by-step process to launch your crowdfunding campaign.
Crowdsourcing: It’s Always Been About the Benjamin provides a historical perspective of the concept of fundraising. It also emphasizes the importance of donor relationships, a key component of any fundraising campaign.
The Unreasonable Institute reflects on a "failed" campaign in a two-part series. By focusing on what went wrong, they illustrate important elements to consider when planning a crowdfunding campaign. Here is the Anatomy of an Unsuccessful Kickstarter Campaign: Part 1 and Anatomy of an Unsuccessful Kickstarter Campaign: Part 2.
Websites
Give For Youth: A global micro-giving site that allows you to fund and follow the dreams of young people around the world, a partnership between Microsoft YouthSpark and Global Giving.
Kickstarter.com: Kickstarter is a way for artists, musicians, filmmakers, and designers to fund their creative projects.
GlobalGiving.org GlobalGiving is a charity fundraising web site that gives social entrepreneurs and non-profits from anywhere in the world a chance to raise the money that they need to improve their communities.
DonorsChoose.org DonorsChoose.org is an online charity that makes it easy for anyone to help students in need. Public school teachers from every corner of America post classroom project requests on the site for funding.
CrowdFundNews A great blog highlighting news from around the world of crowdfunding.
Crowdsourcing.orgThe world’s largest web directory of crowdfunding and crowdsourcing websites.
Crowdfunding for Non-Profits A great Scoop.it blog that consolidates articles, videos, and websites on crowdfunding through the non-profit lens.
Twitter Accounts to Follow
Videos
How to Crowdfund for Social ImpactGreat webinar on how to use crowdfunding tools to help social entrepreneurs grow social projects with Alex Budak, co-founder of StartSomeGood, where he shares tips and tricks to get projects past the tipping point. Specifically, you will learn to distinguish projects that get fully-funded versus those that don’t get past their tipping point, what rewards motivate more giving, and how to identify your organization’s most compelling stories.
Resources
- 10 Crowdfunding Sites to Fuel Your Dream Project
- 3 Social Media Tips for a Successful Crowdfunding Campaign
- 4 Crowdfunding Mistakes for Social Entrepreneurs to Avoid
- Crowdfunding for Non-Profits
- Crowdfunding Nation
- CrowdFundNews
- Crowdsourcing.org
- DonorsChoose.org
- Expert Advice on Crowdfunding
- Give for Youth
- GlobalGiving
- How to Crowdfund for Social Impact
- Indiegogo
- Is Crowdfunding Right For You?
- Kickstarter.com
- PeopleFund.it
- Ten tips for running a successful crowdfunding campaign