Crowdfunding can seem like a new thing – but fundraising is essentially getting funding from a crowd of people

Today when people talk about crowdfunding, they mean using websites to organise fundraising campaigns.

Crowdfunding sites host campaigns which act as a means to promote the campaign. They usually feature a video, some text explaining what you’re seeking to raise and why, and manage payment online via credit or direct debit. The platform automates the process of getting the money from your funders and getting it all to you in the event of success.

Important advantages

Crowdfunding online gives several important advantages. Firstly, moving away from cash makes managing funds easier and less stressful; by using credit and debit cards, there’s no need to have procedures in place to mitigate the risk of theft of cash, no danger to your volunteers from theft and no need for lots of trips to a bank. And, by using online methods, people aren’t restricted to what funds they might have in their wallet at the time you ask, so average donations can be higher than for cash.

Secondly, it can broaden the reach of a campaign beyond the immediate users or local people and tap into families, friends and people who might once have had a connection to a club but have moved away but find out about the campaign from social media platforms. You’re unlikely to know where those people have gone to once they fall off the club’s radar, but people in your current club network are far more likely to.

Finally, in addition to people’s money, you get their email addresses and other details, so you have a means to keep on engaging with them and build the stronger relationships which can be harder with cash or cheque based campaigns.

Eligible organisations can also claim Gift Aid as part of a crowdfunding campaign.

The majority of platforms operate on an ‘all or nothing’ basis, so if a project fails to meet an agreed target by a set date, funding does not proceed and supporters who have pledged to back your campaign get their money returned.

Some also offer ‘keep what you raise’ options, so regardless of what your target is, all pledges of support will be valid. This can seem an attractive way to increase your chances of getting something for your efforts, but experience suggests donors don’t engage as strongly with campaigns which have hedged their bets like this.

Where can I find out more?

There’s lots of platforms available to use. Most charge around 5% + VAT of what is raised on a no-success, no fee basis.

Have a look to see what clubs like yours have used successfully. Some specialise in certain types of project while some have funds available from other partners at national or local level to top-up what you might be able to raise. Check out Nesta and CrowdingIn for more.

Some things to think about:

  • Crowdfunding is a powerful tool but it isn’t a magic bullet. Like any other form of raising funds, you get out what you put in, and simply placing a campaign on a crowdfunding platform won’t get any success for your campaign if you don’t work hard at promoting it on and offline. Even so, it can yield better results in terms of effort than more time-intensive things like organising events.
  • As activity is driven online, it can connect with younger or busier audiences who might not attend events or respond to more traditional fundraising, but can also alienate older and less connected communities, so think about whether it works for your likely donors as much as whether it works for your club’s volunteers.
  • Having a strong social media presence or email list is absolutely vital. If people aren’t used to seeing your club online or hearing from you via email, you’ll struggle to achieve the reach to connect with them. If you want to do Crowdfunding and don’t have a website, or a Facebook page or regular newsletter then think strongly about developing this first.
  • People are bombarded with requests for funding online, so make your appeal stand out. Make it as professional as you can without being too slick; too professional a video can make people think that you’ve got money to burn and so you don’t need theirs, while too homespun and error-ridden can lead people to think you’re well-meaning amateurs who they don’t really trust to spend the money properly.