How crowdfunding can help launch social ventures – what we’ve learned so far
Last autumn the RSA launched new support to help RSA Fellows prepare and publicise crowdfunding campaigns – where people set a funding target and try to raise that money from lots of people. I recently gathered together a large group of people to feedback on our review of the first half a year of this support and see how it is relevant for different organisations.
This blog puts together the both the review in full and a quick snapshot.
The organisations included eight providers of support and funding to launch and scale social enterprises, six crowdfunding platforms where backers make a donation or get a reward for their financial outlay, five crowdfunding platforms where backers invest in a loan or equity to the venture and three researchers. I’m really grateful to the organisations for their thoughtful input.
Some of the feedback that we got
What it meant for incubators and investors launching social enterprises
“Three years ago, crowdfunding was barely on the agenda for any of the students coming through. Increasingly we are hearing about crowdfunding; I would say that about a third of our start-up students it is certainly an avenue that they are exploring”
“I think the support you are giving, particularly in terms of marketing will be really useful, particularly at those at the early stage of development… I will certainly urge our social enterprises to look.”
“I think that your screening and branding really does add a lot to the projects.”
What it meant for crowdfunding platforms
“You did very well with the success rate. You’ve benefited there from a lot of curation and RSA Fellows are high calibre people and obviously there was a lot of support… going to be very difficult as you scale from £120k to £450k trying to maintain the same success rate as necessarily you have looser contact with the project. So finding a way to do that, whether it’s shared resources…”
“I think your decision to choose Kickstarter platform was vindicated because you were successful”
“What’s going to be very interesting to see is if you can measure the social impact of some of those projects that are funded and see how they impacted the wider community of people that came into contact with and how they have benefited from the services they’ve managed to put on.”
“We, and I suspect a few other platforms, would give you a blank sheet of paper and say what do you want: workshops; fees, forget about the fees; marketing; platform cost – whatever you want.”
“You should probably think about joining up with other grant funders other loan funders and other equity funders, I know you are thinking about that but it does need to be matched up.”
What it meant for researchers looking at crowdfunding
“We get approached by quite a lot of charities saying “we’ve heard about this great thing called crowdfunding, we want to do it with our own platform” at that point it is really hard to tell people what to do. You provide a good example of not going down the set up your own crowdfunding platform.”
“It seems to me that crowdfunding has moved from “anyone can pitch an idea and see if it is successful” to now when there is more and more curation on platforms. Which I guess is a bit dangerous because what if one of the Fellows had a really wacky idea and tried it out and failed, wouldn’t that be good because they have tried it out.”
To sum up
we’ve heard about this great thing called crowdfunding, we want to do it with our own platform
We set out how to test out whether crowdfunding can benefit your organisation or your members without the costs of building a platform.
crowdfunding is certainly an avenue that about a third of our start-up students are exploring
We provide introductory training to see if crowdfunding is right for a start-up, feedback on crowdfunding pitches, help to build a marketing plan and then publicity and profile once a crowdfunding campaign is live.
why did you choose Kickstarter rather than the UK platform we have?
We looked at six things: whether it was free to get a partnership page; whether £200,000 was raised on the platform; what profile the platform gave projects; training (for us, for project leaders and for backers); how much data we got; what the cost is for projects.
The group helped us identify some priorities:
- to inform our vision to expand our publicity to equity and loan crowdfunding campaigns, we need more research into how Fellows want to help social enterprises: with a charitable donation; with investment; by buying their first line of production?
- organise events with other crowdfunding platforms for campaigns in specific sectors to get feedback particularly from philanthropists and funders with specialist knowledge of their subject area
- explore whether there is a possible bigger role for grant funders match-funding crowdfunding campaigns
- ask for feedback from the project leaders on our processes; what did they most value from us
- know more about the people behind these teams: what stage of their enterprise are they; where they come from; who they are; what rewards worked; how they would price their rewards differently next time
Thankfully Nesta and Cambridge University are collaborating on a piece of research that will help deal with 1) and 5) so please do participate in their crowdfunding survey.
I would be really interested to hear more feedback on this review, so please do add your thoughts in the comments.
RSA Catalyst provides money, expertise and crowdfunding to Fellow-led ideas that aim to have a positive social impact. Find out more and apply for support at www.thersa.org/catalyst or visit the latest live crowdfunding campaigns at www.kickstarter.com/rsa