Ideavibes Presentation on Crowdfunding and Fundchange - June 23/11

Crowdfunding and Arts Funding Paul  Dombowsky  

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Introduction

Social  enterprise  web  development  company  that  has  developed  the  first  Crowd  Engagement  Pla>orm  for  crowdsourcing  and  crowdfunding.      One  of  Canada’s  first  crowdfunding  sites  for  chariCes,  non-­‐profits  and  arts  groups  to  fund  change  in  our  communiCes  one  project  at  a  Cme.  

7.7%  Percentage  of  Canadians  that      aIended  5+  arts  events  in  2007  

1%    Percentage  of  donaCons  in  Canada      given  to  arts  &  culture  

3.7%  Average  number  of  organizaCons      each  donor  in  Canada  gave  to  

 25%  of  all  arts  donors  gave  75%  of  the  total  donated    

Starting Point

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“Fundraising  Trends  and  Challenges  in  the  Canadian  Direct  MarkeCng  Sector”-­‐  a  research  paper  from  2009  by  Cornerstone  Group  of  Companies  shows:    •  Donors  who  make  their  first  giZ  to  an  organizaCon  online  as  opposed  to  

via  direct  mail  have  a  much  higher  average  giZ    

                   $73  vs.  $30    

•  There  are  now  more  than  4  Cmes  the  number  of  new  donors,  per  organizaCon,  from  online  iniCaCves  than  5  years  ago  (9M  to  40M).”  

Online Giving

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Perhaps  there  is  an  opportunity  to  try  something  new  to  engage  more  donors  to  support  the  arts?      

Opportunity

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•   A  crowd    •   A  challenge  or  a  project    •   A  process  and  tool  for  engagement    •   Trust  and  commitment  in  your  crowd  to  take  acCon    •   Key  performance  indicators  –  what  does  success  look  like?  

•   Proof  of  acCon  –  your  crowd  wants  to  see  what  happened  

Crowdfunding - What do you need?

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Donor Generations

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Millennials  (born  ’91  and  aZer)    -­‐  ?  

Gen  Y  (born  ’81-­‐’91)  –  Average  DonaCon  $325  

Gen  X  (born  ’65-­‐’80)  –  Average  DonaCon  $549  

Boomers  (born  ’46-­‐’64)  –  Average  DonaCon  $725  

Civics  (born  ’45  or  earlier)  –  Average  DonaCon  $833  

Where Donors are Giving

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0.0%   10.0%   20.0%   30.0%   40.0%   50.0%   60.0%  

Checkout  DonaCon  Fundraising  Event  

Tribute  GiZ  Charity  GiZ  Shop  

Online  via  Website  Mailed  GiZ  

Monthly  Debit  In  Lieu  of  GiZ  

Phone  Third  Party  Vendor  

SMS  Social  Network  Site  

Who is your crowd?

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Donors  

Prospects  

Event  AIendees  

Mailing  Lists  

Donors’    Network  

Prospects’  Network  

Event  AIendees’  Network  

Mailing  List’s  Network  

The  crowd  you  know    The  crowd  you  don’t  know  

Social Media Makes the Connection

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Projects or Doable Asks •  Easier  for  most  people  to  wrap  their  head  around  a  smaller  project  as  opposed  to  an  enCre  opera  producCon  or  building  a  theatre.  

•  Examples:  •  AIendance  at  fesCval  •  New  producCon  •  New  website  •  Film  trailer  •  Outreach  program  

Post  Promote  Share  Search/Filter  Fund  Receipt  Report    Costs:  $99  +  hst  to  join  

 includes  2  posCngs  3.9%  processing  fee  

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Examples: Fundchange

Post  Promote  Fund  Report  

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Examples: Crowdrise (US only)

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Examples: WeDidThis (UK)

Successfully  Funded  Projects:  3,910    Dollars  Pledged:  $27,638,318    Total  Pledges:  386,373    Average  Pledge:  $71.53    

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Examples: Kickstarter (Not in Canada)

•   It’s  social  –  the  crowd  promotes  projects  it  likes  •   It’s  social  –  the  crowd  won’t  promote  projects  that  aren’t  shareable  

•   Success  comes  to  those  that  acCvely  build  a  crowd    •   A  challenge  for  organizaCons  new  to  social  media  

•   It’s  the  free  market  at  work  •   It’s  the  free  market  at  work  

•   Build  sCckiness  to  the  project  •   Need  to  pay  aIenCon  to  write-­‐up  to  inspire  funders  

Benefits & Challenges

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Things  to  keep  in  mind:      •  Crowdfunding  success  comes  quickest  to  organizaCons  that  are  social  –

media-­‐aware  and  engaged.    If  your  organizaCon  is  not  yet  social  media-­‐enabled,  it  will  take  Cme  and  human  and  financial  resources  to  do  so.  

•  Because  your  efforts  are  only  as  good  as  the  crowd  you  are  able  to  mobilize  to  your  cause,  it  makes  sense  that  your  organizaCon  strategically  manages  and  promotes  its  brand  online.      

•  Make  sure  your  target  audience  is  online  and  will  give  online  •  If  you  opt  to  post  your  projects  on  established  crowdfunding  sites,  do  your  

homework  –  be  careful  of  the  company  you  keep.    

Integrating Crowdfunding into Your Organization

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•  Building  our  own  crowd  •  Tap  into  the  collecCve  crowd  that  funds  change  •  CreaCng  desCnaCon  for  arts  funding  based  on  the  crowd  and  

driven  by  social  media  •  Now  supports  sharing  on  Facebook  

Why Fundchange?

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•  $99  to  join  –  includes  3  free  posCngs  •  $50  to  post  projects  aZer  first  3  •  You  receive  96.1%  of  money  raised  •  Max.  project  size  is  currently  $5000    

Offer •  First  Alliance  Member  to  fund  project  (+$2000)  gets  an  iPhone  •  Media  campaign  focused  on  partnership  with  Alliance  •  Eligibility  for  TELUS  matching  campaign  based  on  Facebook  

integraCon  –  Summer  Campaign  

Joining Fundchange

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•  Donor  stats,  etc.  came  from  “The  Next  GeneraCon  of  Canadian  Giving”  –  Nov.  2010  –  by  Vinay  Bhagat,  et  al  

•  “The  Wisdom  of  Crowds”  –  book  by  James  Surowiecki  •  “Crowdsourcing”  –  book  by  Jeff  Howe  •  “Fundraising  Trends  and  Challenges  in  the  Canadian  Direct  

MarkeCng  Sector”,  a  research  paper  released  in  2009  by  Cornerstone  Group  of  Companies    

Resoruces

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Thank you  

Paul  Dombowsky  |  613.878.1681  |  [email protected]