Definition: a group of people invest or donate a small portion of a larger investment over the internet. That money is pooled together to bring off a project that otherwise would need traditional sources of funding.
Extremely cool and definitely effective, Crowdfunding is a viable application of these principles. Of course it is: it’s been going on for centuries via investing in companies and projects — but now it’s so much easier and transparent of a process. No longer focused on commercial enterprises, any enterprise in need of funds can connect the long tail of people interested in a particular topic, play, artist, film, event, political candidate, even a niche knitting and crocheting site to bring together small amounts of money to raise what is needed. Raising money from fans to record an album, for example, would have been prohibitively difficult in the past, but now a band can easily offer free downloads, take payment, show progress, and keep fans abreast of developments.
And this extends beyond simply an alternative for funding but can also be applied in untold new ways. Case in point: what about crowdfunded investigative journalism?
Verdict: Viable and ripe for experimentation.
Examples of crowdfunding:
Album recordings and band support: Sellaband, ArtistShare, SliceThePie, VIP Band Manager.
Soccer club takeover: MyFootballClub
Fashion: Catwalk Genius, nvohk,
Community funding: Liverpool Culture Cafe.
Creating a film: A Swarm of Angels, Its Our Movie, FilmRiot, IndieGoGo,
Content creation: Countless blogs seeking donations, Ze Frank, Fund A VLog, Democracy in America.
Loans: Prosper, Kiva, Zopa, Lending Club.
Brewery Funding: BeerBankRoll
Journalism: Guerrilla Journalism Fund, Assignment Zero
Political fund raising: ActBlue
Music festival: Tennents Mutual
Tools for crowdfunding: Crowdfunder, FirstGiving, BountyUp, Fundable, Global Giving
VC decisions: VenCorps
Read previous parts:
Part 1: Figuring out crowdsourcing: What does it mean? What’s working? What isn’t?