Crowdfunding sites now bring in millions of dollars per week
Austin [TX] American-Statesman, 4/9/11
Proponents say crowdfunding --"micropatronage" -- is a modern twist on the age-old artist-patron relationship. "Back in Beethoven's day, he had a handful of healthy, wealthy patrons footing the bill for his creative endeavors. Now, a creative entrepreneur can rely on a network of folks to make a project happen," said Brian Meece, founder of Rockethub.com, one of the largest crowdfunding websites. "I like to say that Beethoven plus social media equals crowdfunding." Besides Rockethub.com, the best-known sites in the crowdfunding movement are Kickstarter.com, and Indiegogo.com. Another significant player is ArtistShare.com, which was founded in 2000 and is generally considered to be the first crowdfunding website. While there is no way to track every crowdfunded project, Meece said, the industry has seen substantial growth in the past year. "Ballpark figure for us and Kickstarter and Indiegogo, we're probably in the millions of dollars per week aggregate for all three platforms. So it's definitely a significant amount of money." Brian Camelio, who founded ArtistShare.com in 2000 and is considered one of the fathers of crowdfunding, said he build the site's business model "around focusing on the process being the value to the fan, rather than the end result. We took on the philosophy that the listener was of equal importance to the performance, play an equal role in the experience. People have called it crowdfunding, but I don't think the focus should be on the funding. The focus should be on the experience."
2 years since launch, Kickstarter.com has raised millions for the arts
Yancey Strickler, The Kickstarter blog, 4/28/11
Two years ago today on April 28, 2009, Kickstarter.com launched. There was no party, little fanfare. Two of the first projects were launched by us. Some great early projects brought momentum. Each project seemed to inspire three more. And backing a project was fun. In exchange there were updates from the road, thoughtful rewards, a story to share. To celebrate our second birthday we've decided to open up the vaults. The numbers tell the story far better than we could.
Total Dollars Pledged: $53,107,672. Kickstarter operates on an all-or-nothing funding model where each project's goal must be reached to be funded. Of the $53 million that has been pledged, $40 million has been collected and $6 million is still live (projects that are still funding). The remaining $7 million is the amount pledged to projects that did not meet their funding goals. This 85% collection rate has stayed quite steady over the past two years.
Total Projects: 20,371. 7,496 of these -- approximately 43% -- have been successfully funded. In the concept stages of Kickstarter we had projected a 5% success rate. Of the projects that do not meet their goal, 21% never receive a single pledge. What is the tipping point for funding? With just a single pledge, a project's chances of success jump to 52%. Projects that reach 30% of their funding goal succeed more than 90% of the time.
Funding totals by category: Film: $19,717,790; Music: $13,094,547; Design: $3,601,851; Art: $3,184,732; Publishing: $2,732,501; Theater: $2,570,503; Technology: $1,748,109; Photography: $1,679,361; Food: $1,583,063; Games: $1,052,557; Comics: $943,118; Dance: $645,492; Fashion: $554,048
Repeat project backers = 13% of total. Ofthe 591,773 people who have backed Kickstarter projects, 79,658 are repeat backers. This is a key number for us. It's Kickstarter's "supply side." They're people who don't just back a friend's project, they find something else to support. And sometimes fifty other things to support.
In Canada, new crowdfunding opportunities for the arts
Rebecca Coleman's blog, 4/22/11
Two months ago, I wrote a post on Fundchange, a new Canadian crowdsourcing application.
Paul Dombowsky of IdeaVibes, who is starting up FundChange, said: "Up until now, crowdsourcing in Canada has been difficult to access. Engines like Kickstarter have only been available in the States, but now, with the assistance of some corporate matching, non-profit companies in Canada that have big ideas can now (with a little work!) get them funded."
Well, the other day I got an email from Dombowsky with an update, and I'd like to share it with you.
"Today Ideavibes...announced that $30,000 has been raised by donors and their social networks, only two months after launching Fundchange.com, one of Canada's first crowdfunding platforms. TELUS, a partner and sponsor of Fundchange, contributed an additional $20,000 through project funding matches. Ideavibes also announced today Fundchange is widening its mandate to welcome not-for-profit organizations which are not registered charities."
The good news is, that for smaller arts organizations that are not registered charities, there will soon be a crowdsourcing engine just for you. Ideavibes is working on FundtheArts.ca, which will help smaller, arts-focused organizations who do not have charity status to raise funds for their projects.
"The Fundchange model is simple - you pay up front for a posting ($50 each if you purchase individually) but then you get all the money you raise for your project minus the small pesky credit card fee (3.9%). Funds raised for projects that aren't fully funded by the time you want to remove the project (typically at 60 days), will still be sent to you."
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Commentary: Social media and fundraising: 3 ways to jump-start a relationship
Colleen Dilenschneider, Know Your Own Bone blog, 4/26/11
Social media does not belong to the marketing department. Social media informs. It educates. It creates connections....So why aren't fundraisers getting with these new tools like the marketers? Utilizing social media within the development department is just plain smart. I don't just mean utilizing social media to help meet a bottom line through mobile giving campaigns or publicizing membership events -- though it can be used very effectively for these purposes. If marketing, education, and development can work together to track social media interaction and engage audiences, then it can benefit all three divisions. Here are three easy, low-resource ways that social media can help development departments build connections and keep a pulse on donor engagement:
1) Note interactions with donors on Facebook and Twitter to monitor buy-in. Make a habit to skim your organization's Facebook page at the end of each day (or week, even) to see if a donor engaged on the site. You may just have a better chance making a formal ask to someone who you know is seeing and interacting with your content.
2) Make a private Twitter list of donors -- and interact with them. Quick Google searches can often indicate whether or not a specific donor has a Twitter account. Compile a list of donor's Twitter accounts and keep tabs on these folks using private lists. This way, followers cannot see your donors, but the person running social media has a quick and easy way to remember who to keep an eye on and engage.
3) Note donor's interests through social media to find your connection. Social media profiles and activities can provide a lot of personal information about donors. Marketeers use this information to help trace their demographic, but fundraisers should be using social media to fill in gaps about donors' interests so that they can be more efficiently 'courted' at events and on-site. By utilizing your museum's social media channels, fundraisers can learn a lot about what it is about the institution that engages the donor. If someone tends to 'like' statuses about specific events or artists, that gives you a peek into their interests.
Generation Y has incredible giving potential, if you can tap into it -- and they are on social media. In fact, many of us were raised with virtual connections and it's an easy way for us to communicate. Fundraisers who can figure out how to use this medium by keeping tabs on and engaging with donors virtually may have a big advantage in the long run.