You’ve been hearing more and more about it, but what exactly is crowdfunding? This new type of fundraising is where a large group of people (the crowd) make donations (funding) to support a specific project of program that is outlined on an online platform. Online platforms include Kickstarter, IndieGoGo and Patronicity.
Crowdfunding can be done by anyone (have you heard of the potato salad guy) for any reason. Some online giving platforms only host specific projects, for example Kickstarter is for art programming and projects, while others like IndieGoGo are open to all ideas.
Why would a nonprofit choose crowdfunding over more traditional giving approach? Crowdfunding allows an organization to do two things that traditional campaigns have a hard time doing: creating a sense of urgency and providing incentives for giving. Patronicity co-founder, Ebrahim Varachia, has found that 80% of donations are made in the first and last 3 days of a campaign. By making finite start and end dates for your campaign, your campaign will appeal to people anticipating the launch and people who procrastinate.
Crowdfunding sites also allow for giving incentives. From a hand written card, to a tweet mentioning the donor, to a thank you video, nonprofits can find creative and fun ways to thank donors based on the amount the donor gives. The donors know exactly how and by when they will be thanked. If it’s in your budget, you can even consider offering product, memberships or passes as an incentive to donate.
This type of fundraising has started to catch on in the Upper Peninsula. To date, one of the most successful crowdfunding campaigns in the region was coordinated by Nheena Wyer Ittner. Nheena leveraged her network to spread the word and raise $10,000 for the Marquette Skate Park via Patronicity. If the Skate Park met or exceeded the $10,000 goal, the MEDC would match with a $10,000 grant though the Public Spaces, Community Places program. Not only did they meet the goal, the exceeded it by thousands of dollars.
At the Michigan Municipal League Convention in Marquette, Nheena presented on her crowdfunding experience. It was interesting to hear about the many donors that she wasn’t expecting to give, and the donors that she didn’t know that gave. She noted that the video that was created was shared via email, Facebook, Twitter and more to engage people that love the Marquette area that don’t live in the area. People in California that had no connection to Nheena even donated! When asked about her experience Nheena said “It was a testament that with today’s technology the term community is worldwide. The unexpected became the reality. It also took a relentless attitude, keeping the “word” out there to build hype, and not to give up. If I could do it believe me anyone could! It was totally cool!”
Although initially time consuming, crowdfunding is an interesting, new way for nonprofits to find the money they need for programs that are really making an impact. I can’t wait to see how crowdfunding continues to grow in the U.P.
Victoria Leonhardt is an Associate at GLCYD. She oversees the marketing strategy of the organization in addition to facilitating community mobilization in the Eastern Upper Peninsula.