Alessandra Green was Arts Fundraising Fellow for the London Transport Museum until September 2016, and is now Corporate Partnerships Officer at the Design Museum.
There has never been a better time to crowdfund. The ‘alternative finance’ market has doubled in the past year and this pace is expected to continue throughout 2016, according to research by Nesta. In fact, crowdfunding became so established in the last 12 months that the word was finally accepted into the Oxford English Dictionary in June 2015 (alongside hangry, man spreading and wine o’ clock!)
Whilst this is promising news, crowdfunding is not without its risks. 57.6% of all Kickstarter projects are unfunded, and if you are unsuccessful your failure will be highly public (see Year 2 Fellow Ariana Musiol’s thoughts in her blog Towards Sustainability in the Arts). As someone who is looking to start a crowdfunding project for their organisation this information is off putting, to say the least.
Fortunately for me, Blast Theory and Social Misfits Media have recently released two free fundraising guides on crowdfunding. Both include tips on how to crowd fund successfully, and are great resources for anyone who is embarking on a project in the challenging world of online fundraising. Here are seven of my favourite tips for crowdfunding:
- Evaluate your project
As the Kickstarter statistic shows, crowdfunding is not a guaranteed win. Like any other type of fundraising you need to assess whether your appeal is the right fit for the type of fundraising platform. You will find it difficult to raise more than £10,000 via crowdfunding, so larger appeals might not be suitable. If crowdfunding isn’t going to offer a good return on investment for your project then don’t do it!
- Choose a platform
Unfortunately, not all crowdfunding platforms are the same and it can be quite difficult to decide which one to use. Some sites like Indiegogo and Kickstarter have a 5% platform fee and some will have a processing fee that you will need to consider. Most importantly, you need to check whether you are allowed to keep the money you raise if you do not reach your fundraising goal. Kickstarter, for example, has an all or nothing approach whereas Indiegogo are more lenient.
- ‘Friendraise’ to fundraise
According to Blast Theory, projects that are 30% funded when they go public are 90% more likely to reach their fundraising goal. People are much less likely to back projects that they don’t think will succeed, especially if they don’t know you or aren’t familiar with your brand. If you already have a good relationship with a target audience (especially ones who have a history of giving to your causes) then market your appeal to them first. Face to face asks or direct marketing campaigns are a great way to get the ball rolling before appealing online to people who you don’t have a strong relationship with and, as a result, will need more persuasion to give.
- Have a strategy
Crowdfunding is time consuming and will take months of planning before you go live. Key things to consider are how and when you will market your campaign, how you will manage your campaign when you go live and how you will follow up with supporters after your campaign has finished. The latter is especially important if you want to engage new audiences and encourage one off donors to give repeatedly and to other appeals.
- Create a video
Campaign pages with a video raise 114% more than average. But make sure that you keep your video short, ideally no longer than two minutes, otherwise you will get less views. Your key message should also ideally be made in the first ten seconds of your video as most people rarely watch it all the way through. For example, Blast Theory’s fundraising video had only 35% completed video plays out of a total 12,059 views.
- Establish your project page
Like your video, your crowdfunding page should be short and sweet. Viewers will only typically read a 1/4 of your copy and spend 20 seconds on your site before moving on. You need to make sure that your reader sees all the key information in that time, so make it clear from the beginning why you need their money and how they can help.
Most crowdfunding guides will argue that rewards determine the success of your campaign. 92% of all campaigns that reach their funding target offer rewards and they can be a key incentive for getting people to engage. However, recent research has shown that this type of thank you gift can actually reduce contributions- donators want to be altruistic and don’t want to donate just for the sake of a freebie. Rewards can still be a good idea but make sure that they are unique and offer value for money. Key rings and mugs will not be particularly appreciated, but tickets to a behind the scenes event at your organisation are a great incentive for people to give.
Crowdfunding can be very challenging; however, it is an exciting and creative fundraising tool and a great way to engage the public with your organisation and appeal. Research, planning and a good marketing campaign can make all the difference, and if anyone is looking to start a crowdfunding project soon- good luck!
Let us know if you have seen any creative campaigns, we’d love to hear.