crowdfunding: building best practice · 5 types of crowdfunding • donations: the collective...

Crowdfunding: Building Best Practice

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7/15/15 Footer 2

Crowdfunding Trends

Deb Ashmore Target Analytics, division of Blackbaud Inc.

7/15/15 Footer 3

Crowdfunding Trends

Deb Ashmore Target Analytics, division of Blackbaud Inc.

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WHAT IS CROWDFUNDING?

Crowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the internet. One financial expert describes it as “large groups of people combining their economic power to support an organization, company or project they believe in.” The crowdfunding model is fueled by three types of actors: the project initiator who proposes the idea and/or project to be funded; individuals or groups who support the idea; and a moderating organization (the "platform") that brings the parties together to launch the idea.

Source: Wikipedia

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TYPES OF CROWDFUNDING

•  Donations: the collective effort of individuals to help charitable causes.

•  Rewards: entrepreneurs pre-sell a product or service to launch a business concept without incurring debt or sacrificing equity/shares.

•  Equity: the backer receives shares of a company, usually in its early stages, in exchange for the money pledged.

•  Royalty: selling a portion of a future sale (royalty) in return for an investment.

•  Lending: Prospective borrowers submit their requirements, and are then matched with pools of investors who are willing to accept the credit terms.

•  Hybrid

6 RD SOS FY13

CROWDFUNDING PLATFORMS

2014: GoFundMe Raised $470 million 6,000,000 donors 268% growth

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INTERNATIONAL CROWDFUNDING REVENUE

1.47

2.7

6.1

16.2

0 5 10 15 20

2014 2013 2012 2011

Revenue in Billions

9.46 billion in North America

Source: Massolution.com Crowdfunding Industry Report

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REVENUE BY CROWDFUNDING TYPE


$1,940

$11,080

$1,330 $1,110 $487 $273

Donations Lending Reward Equity

Revenue raised in Millions

Hybrid Royalty

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CROWDFUNDING DEMOGRAPHICS

Source: Quantcast via Art of the Kick Start

11



12



13

GOFUNDME.COM

Source: Alexa.com

14

INDIEGOGO.COM

Source: Alexa.com

15

KICKSTARTER.COM

Source: Alexa.com

16

Source: The Crowd Data Center

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SUCCESS BY CATEGORY

• Technology projects have each raised the most with $100,242 on average

• Technology category has raised the most with $247,797,579 funded

• Comic projects have the best chance of success at 43.5% on average (average success is 23.2%)

• Games projects are most popular with 364 backers each on average (877 in fully funded)

• Music category has had the most successful projects with 7,444 ending fully funded


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PERCENT OF PROJECTS FULLY FUNDED

Art – 25.4% Charity – 10.1% Community – 16.4% Education – 14.6% Event – 26.2% Film – 25.0% Music – 33.7% Radio and Podcasts – 32.0% Technology – 13.9% Video/Web – 13.4%


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CROWDFUNDING PREDICTIONS


2015 Predictions $34.4 billion -- $17.25 in North America $2.85 billion in Donations

Platforms will become more vertical and there will be more of them. # of Crowdfunding Platforms

2007 100 2014 1,250

QUESTIONS?

THANK YOU!

Deb Ashmore- [email protected]

21

WHAT IS CROWDFUNDING?

Crowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the internet. One financial expert describes it as “large groups of people combining their economic power to support an organization, company or project they believe in.” The crowdfunding model is fueled by three types of actors: the project initiator who proposes the idea and/or project to be funded; individuals or groups who support the idea; and a moderating organization (the "platform") that brings the parties together to launch the idea.

Source: Wikipedia

22

TYPES OF CROWDFUNDING

•  Donations: the collective effort of individuals to help charitable causes.

•  Rewards: entrepreneurs pre-sell a product or service to launch a business concept without incurring debt or sacrificing equity/shares.

•  Equity: the backer receives shares of a company, usually in its early stages, in exchange for the money pledged.

•  Royalty: selling a portion of a future sale (royalty) in return for an investment.

•  Lending: Prospective borrowers submit their requirements, and are then matched with pools of investors who are willing to accept the credit terms.

•  Hybrid

23 RD SOS FY13

CROWDFUNDING PLATFORMS

2014: GoFundMe Raised $470 million 6,000,000 donors 268% growth

24

INTERNATIONAL CROWDFUNDING REVENUE

1.47

2.7

6.1

16.2

0 5 10 15 20

2014 2013 2012 2011

Revenue in Billions

9.46 billion in North America


25

REVENUE BY CROWDFUNDING TYPE


$1,940

$11,080

$1,330 $1,110 $487 $273

Donations Lending Reward Equity

Revenue raised in Millions

Hybrid Royalty

27



28



29



30

GOFUNDME.COM

Source: Alexa.com

31

INDIEGOGO.COM

Source: Alexa.com

32

KICKSTARTER.COM

Source: Alexa.com

33


34

SUCCESS BY CATEGORY

• Technology projects have each raised the most with $100,242 on average

• Technology category has raised the most with $247,797,579 funded

• Comic projects have the best chance of success at 43.5% on average (average success is 23.2%)

• Games projects are most popular with 364 backers each on average (877 in fully funded)

• Music category has had the most successful projects with 7,444 ending fully funded


35

PERCENT OF PROJECTS FULLY FUNDED

Art – 25.4% Charity – 10.1% Community – 16.4% Education – 14.6% Event – 26.2% Film – 25.0% Music – 33.7% Radio and Podcasts – 32.0% Technology – 13.9% Video/Web – 13.4%


36

CROWDFUNDING PREDICTIONS


2015 Predictions $34.4 billion -- $17.25 in North America $2.85 billion in Donations

Platforms will become more vertical and there will be more of them. # of Crowdfunding Platforms

2007 100 2014 1,250

QUESTIONS?

THANK YOU!

Deb Ashmore- [email protected]

Crowdfunding Anne O’Malley

Vice President, Membership

New York Public Radio #PMDMC

Crowdfunding

Organizational Considerations

•  Timing of campaign relative to pledge

•  Potential incrementality of revenue

•  Staffing and resources

•  A strong story component

•  Appeal to a younger demographic

•  Content that can translate to rewards

Project Selection Criteria •  Potential to generate PR/Buzz

•  Established social networks that can be tapped

Crowdfunding Platforms

Plenty of Crowdfunding Sites Exist

#PMDMC

Crowdfunding Platforms

NYPR has used 3 Crowdfunding Sites

#PMDMC

●  Strongest CF brand ●  All or nothing model

●  Great customer support

●  Fees for successful campaigns ○  Kickstarter Fee: 5% ○  Processing Fee: 3%-5%

●  Must create something new

●  Rewards are required

●  Recommend 30 day length

●  Gifts to non-profits are tax deductible

●  Many podcasts use to fundraise

●  Gaining popularity

●  Can receive funds no matter what

●  Fees ○  Successful: 4% ○  Unsuccessful: 9% ○  501(c)(3): 3%-7% ○  Processing: 3%-5%

●  Allows you to raise money for anything

●  Rewards are optional

●  Variable campaign lengths

●  Gifts to non-profits are tax deductible

●  Popular among celebrity-backed causes

●  Account not required to give

●  Strictly for charitable causes

●  Fees: ○  All: 3% (includes processing)

●  No goal required

●  No rewards

●  No time-limit

●  Most flexible

Project: Produce Meet the Composer Season 1 Goal: Raise $8,000 in 30 Days to produce 3 Episodes

#PMDMC


#PMDMC

•  Show had a clear identity and goal: To create a sound rich podcast that blends music and interview format into a single compelling story

•  Video pitch featured the host

explaining the show idea and working with composers

•  Rewards: early episode release, CDs, T-shirts, totes, exclusive content & acknowledgements

•  Hit 50% of goal in one day

•  Only took 3 days to reach total $8,000 goal

•  Announced stretch goal of $16,000 to create two more episodes

•  Reached stretch goal by the end of campaign

•  Met Backer Challenge Goal: Get 250 backers and a generous donor will contribute $5,000

Campaign Details

Campaign Results: $16,060 from 293 Backers

#PMDMC

•  80% of Backers were new to NYPR •  85% took a reward of some kind •  $1,500 was the highest single pledge •  $54.81 was the average pledge amount •  $2,879 raised from Kickstarter’s audience


#PMDMC


#PMDMC

•  Campaign built on Season One success

•  Focused on the five composers featured and mobilized their fan bases

•  Video included details of production plus other potential projects if we blow our goal away

Campaign Details

•  Rewards: ringtones, mixtapes, CDs, t-shirts, posters, acknowledgments

•  Hit 60% of goal in two days

•  Only took 1 week to reach total $20,000 goal.

•  Announced stretch goal of $35,000 to create bonus tracks and commissioning fund (didn’t reach).

Campaign Results: $30,044 from 571 Backers

#PMDMC

•  80% of Backers were new to NYPR •  89% took a reward of some kind •  $5,000 was the highest single pledge •  $52.62 was the average gift •  $4,506 raised from Kickstarter’s audience

Rewards Analysis

#PMDMC

First Campaign Second Campaign •  22 Rewards Available

•  Included early episode releases (hard to fulfill)

•  Traditional t-shirts, totes, CDs offered

•  Flash drive with special content

•  11 Rewards Available

•  More digitally based rewards like ringtones and audio mixes

•  T-shirts & posters featured composers

Social Media

#PMDMC

35% of funds acquired via social media $5,000 pledged by a known prospect responding to a Tweet

Team posted almost every day with updates

•  Have a clear project, ideally one which you are already working toward

•  Make sure video is compelling and the page includes lots of imagery

•  Use embedded audio to preview the content you want to produce

•  Limit the number of rewards offered

•  Make rewards digital wherever possible

•  Be sure your reward fulfillment doesn’t eat up the money you’ve earned

•  Engage your backers consistently with updates & social media posts

•  Reach agreement and be clear about your promotion strategy internally

•  Have a single personality people can identify with the campaign

•  Identify major gift patrons or sponsors who will help match pledges

•  Prepare stretch goals ahead of time

Lessons Learned

#PMDMC

Project: Refurbish instruments given to WQXR Instrument Drive Goal: Raise $50,000 in 30 Days

#PMDMC

•  Goal: Raise funds needed to repair instruments donated to WQXR

•  Built on the momentum of instrument drive

•  Engaged existing and new donors to make

monetary contributions •  “Perks” for giving included

acknowledgements, stickers, posters & totes

•  No precedent, so estimating revenue potential was difficult

•  Indiegogo rules allowed us to collect funds no matter how much was raised

Campaign Details •  Raised $14,520 from 170 people

•  Important to use platform with no restrictions on collecting funds when revenue potential is uncertain

•  Campaign landed close to pledge drive, which made it tough to make a priority

•  Many donors were already engaged with the station somehow

Results & Lessons Learned

#PMDMC

Project: Refurbish instruments given to WQXR Instrument Drive Goal: Raise $100,000

#PMDMC

Campaign Details

•  Started campaign to raise funds that will be needed to refurbish instruments from 2016 WQXR Instrument Drive

•  Working with Michael & Kevin Bacon,

who were inspired by the Instrument Drive and approached us to fundraise for it.

•  Working with 6 Degrees foundation to promote

•  Goal is to raise $100,000 to go toward refurbishing the anticipated 6,000 instruments for the 2016 drive

Speaker Information

Anne O’Malley New York Public Radio

Vice President, Membership

[email protected]

#PMDMC

Crowdfunding Susannah Winslow

Membership Director, KLRU [email protected]

#PMDMC

KLRU Crowdfunding Campaigns Four project specific campaigns in three years (Indiegogo) •  BBQ with Franklin (web series) •  Admissions on Trial (documentary) •  Intergalactic Nemesis (web series) •  BBQ with Franklin #2 (2nd season web series and companion

to television series launching in May) •  $72,000 raised •  500 +/- total donors, only 25% current donors One online pledge campaign (Kimbia) •  #yourklru 5 day online giving drive •  $94,000+ raised •  714 total donors, only 27% new donors

#PMDMC

BBQ with Franklin # 2 Challenges: •  1 successfully funded campaign – how to do it again? •  2nd Web series was already filmed, but not edited •  Television show was already in production Campaign positioning: •  Set a realistic goal, with realistic expectations: $20,000 •  Engage the audience with a unique and fun voice With your support, we can share even more with you sooner. •  Give the people what they want! – release video during the campaign to garner excitement

#PMDMC

BBQ with Franklin #2

#PMDMC

Promotions: •  Email blast to 34,000+ recipients + Targeted emails •  Social Media via FB, Twitter, Blog •  Local Press Coverage •  2 People Patter Twitter campaigns: Twitter ads for a tailored audience of BBQ lovers •  YouTube Ads •  Organic Influencer Outreach via Twitter •  Challenge Match

Value of Paid Advertising 53% of visitors to the crowdfunding site during the

lifetime of the campaign were from the People Pattern Twitter campaigns

People Pattern Campaign #1 •  Engagement rate: 4.12% (avg twitter engagement rate between 1% & 3%) •  Link clicks: 3,302 •  Cost per click: $0.71 •  Impressions: 121,792 •  Confident it had a significant impact raising over $7k on the first day of the campaign

People Pattern Campaign #2 •  Engagement rate: 4.58% •  Link clicks: 995 •  Cost per click: $1.50 •  Impressions: 33,009 •  Dollars raised: $650

#PMDMC

Value of Paid Advertising YouTube views of the BBQ with Franklin series

jumped 60% during the lifetime of the campaign

YouTube Ads •  Impressions: 22,054 •  Cost per view: $0.09 •  Link clicks: 145 •  Total cost: $335 •  Total donations from YouTube domain: $2,981

#PMDMC

#yourklru Online Giving Drive What we did: 5 day online giving drive, messaged around transforming the way we fundraise, $50k goal What we did differently: instead of a 10 day on-air pledge drive where we interrupt the regular schedule with on-air pledge breaks, we launched a 5 day online campaign with built-in crowdfunding techniques that included: •  Peer 2 Peer Fundraising •  Social Media •  Urgency & Incentives

#PMDMC

#yourklru Peer 2 Peer Fundraising Engaged members of the following groups: •  KLRU Volunteers •  Young Professional donor group •  Development Committee members •  Board and Community Advisory Board members •  Anyone in the community - Personal fundraisers created a personal webpage, set their own fundraising goal and messaged out to their networks for support of KLRU on their behalf. - A toolkit provided by KLRU made messaging easy for these personal fundraisers.

#PMDMC

#PMDMC

#yourklru Peer 2 Peer Fundraising Personal Fundraiser Breakdown: •  39 Total Personal Fundraisers •  27 actively fundraised •  11 met and/or exceeded their goal •  Total Fundraising Commitments: $21,501 •  Total $ raised by personal fundraisers: $13,326 | 62% to total fundraising commitments | 14% of drive total

#PMDMC

#yourklru Social Media Social media and email messaging engaged viewers, donors and prospects around the hashtag #yourklru •  Facebook •  Twitter •  Instagram •  Periscope KLRU actively began use of the hashtag in the month prior to build buzz and excitement around the online campaign leading up to the launch on June 1st.

#PMDMC

Check out all the social media from this campaign on Storify: https://storify.com/KLRU/yourklru

#PMDMC

#yourklru Social Media Social media accounted for 27% of the site traffic and 4% of donations •  Facebook raised $3,770 •  Twitter raised $225 + one vehicle donation Facebook was a viable and successful avenue to make asks and extend the reach of the campaign - personal fundraisers raised $3,215 via Facebook (24% of the total revenue raised by personal fundraisers and 85% of the total revenue raised via Facebook).

#PMDMC

#yourklru Urgency & Incentives •  Goal Thermometer/progress bar •  Daily/hourly goals were messaged via daily emails, blog posts and social media posts. •  Giveaways (i.e. AppleTV, Austin City Limits passes, KLRU t-shirts) were given away to anyone who donated during specific timeframes or engaged in our social media campaign. •  Challenge matches were incorporated into 3 days of the campaign to double donor dollars instantly. •  Stretch goals were messaged after meeting out initial goal on the 3rd day, and again on the 5th day when we met out first stretch goal.

#PMDMC

#yourklru Strategic Partnerships

#PMDMC

Partnered with local businesses and organizations for giveaways and personal fundraiser incentives in exchange for logo recognition. •  UT Press •  C3 Presents & Live Nation •  Texas Tribune •  Alamo Drafthouse •  Halcyon Coffeehouse: hosted kick-off event

What we’ve learned from the Data

#PMDMC

Crowdfunding has the potential to acquire new donors •  BBQ with Franklin #1: 67% new donors •  BBQ with Franklin #2: 68% new donors And grow your donor base through engagement Of the BBQ #1 donors (204 donors): •  45 have attended a KLRU event since the BBQ campaign •  25 gave their first gift to KLRU after the BBQ campaign Of the BBQ #2 donors (162 donors): •  20 donors gave to both the first & second BBQ campaign •  9 donors exclusively given only to these 2 campaigns •  29 have attended a KLRU event since the campaign, 2 of those being first time donors

What we’ve learned from the Data

#PMDMC

Crowdfunding can appeal to the average PBS donor •  #yourklru donors: 27% new donors, 32% additional gifts, 25% renewals, 15% lapsed donors. •  #yourklru donors average age: 65 (52% age data available) •  24% response rate to post donor survey and 77% self-identified their age as 55+, while 13% self-identified as age 44 or younger. And increase your net revenue •  Net revenue increased by 13% over last June’s 10 day on-air drive, even though the gross revenue was down 29% from last June. •  The net revenue for this online drive is a greater percentage of the total revenue than any on-air drive we’ve done in recent years.

Speaker Information

Susannah Winslow/KLRU Membership Director

[email protected] (512)475-9019

#PMDMC

Questions? Thanks for being here

crowdfunding: building best practice · 5 types of crowdfunding • donations: the collective...

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