2013-09-19

How Nonprofit Crowdfunding Is Changing Fundraising For Good

Tailor-made nonprofit platforms like WeDid.It are exploring facets of crowdfunding that Kickstarter and Indiegogo aren’t. Here’s what these new models could mean for the brave new world of mass fundraising.



At the top of the Kickstarter guideline page are the words cannot be used to raise money for causes—a single sentence that rules out hundreds of nonprofits whose fundraising arms are desperately in need of innovative funding models.

Buried in paperwork, devoid of data-driven tactics, and largely unable to pinpoint which strategies bring in the most revenue, nonprofits end up throwing blind darts at big donors, hoping to hit it big. New startups like WeDid.It are rushing in to fill the void. According to its founders, there are two fundamental differences behind nonprofit and project-based fundraising: human capital and analytics.

"When we started, we noticed the current solutions in the market were all similar in the sense that they offered a technological solution at a monthly or annual fee—and then they kind-of said: Hey, good-luck," explains Ben Lamson, one of WeDid.It’s cofounders.

WeDid.It’s big differentiator is something that could spell a new direction for all crowdfunding projects; the company provides a personal assistant available to each campaign. "We felt that a lot of nonprofits needed more guidance. We wanted to add a human factor into our business that enabled our client to take the guesswork out of their fundraising efforts."

As anyone who’s tried Kickstarter can attest, building a trustworthy, popular campaign is an enormous amount of work. "If nonprofits had a fundraising coach or a rep on their side of things, if they had someone they could email with quick questions or schedule a 30-minute phone call with, then we thought we could increase that likelihood of success," says Lamson. "Everything we do is really built around this human-capital model."

Another interesting aspect of nonprofit crowdfunding which could have ramifications for mainstream platforms: recurring fundraising projects. "With crowdfunding, like Kickstarter and Indiegogo, it’s very much about a one-off fundraising campaign," says Lamson. "Most product projects are concerned with just the one project and getting it off the ground. Funding it, delivering it, and sales."

"The nonprofit world is not really selling a tangible product, they’re selling their vision," Lamson says. "Take it a step further, and you realize that they are about more than just a one-off project. Their main concern is relationship building. So sure, nonprofits have fundraising that includes crowdfunding in it, but its much more than that. It’s about enabling your current potential supporters to engage with you and sustaining a relationship with them. Here, you’re really hoping it’s not just a one-time donation. Your goal is bringing down and acquiring new donors to continue to give throughout their lifetime. It’s about continual donations."

[Image: Flickr user Ismar Badzic]






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1 Comments

  • startsomegood

    Great to see a focus on social impact crowdfunding.

    Actually, many of the issues you discussed have already been addressed on our platform, StartSomeGood.com - the crowdfunding platform for social impact projects! We are dedicated to helping all types of social impact projects, regardless of whether they are a nonprofit, for profit, social enterprise, charity etc. We've helped successfully fund over 200 social impact projects from across 22 countries.

    We assign every venture with a dedicated Venture Support team member. Our team are not only passionate about crowdfunding, but they have also have extensive experience working with nonprofits, social enterprise, charity etc.

    Interesting point about using ongoing projects. Part of the reason we think that crowdfunding has reinvigorated fundraising is that it is tangible because it is for specific projects. Supporters are able to understand where there money is going and really feel like they are a part of making something happen. While it is true that nonprofits are engaged with ongoing projects with long term impact, we encourage our nonprofit ventures to reframe ongoing activities as discreet “chunks”. For example, you could aim to fund your operations for a particular time period, expand to an additional location or hire a new much-needed member of staff.

    Check out more of our non-profit crowdfunding advice here - http://startsomegood.tumblr.co...

    Thanks!

    Natasha - natasha@startsomegood.com