A guide to crowdfunding for community projects
Crowdfunding pulls together a community of like-minded people and allows them to contribute collectively to something they value.
Words by Samantha Morris

What is crowdfunding?

Centuries past, when a person wanted to publish a book, they needed to seek commitments from people to buy it before it went to print. People effectively coughed up the cash to show their support. And then the publisher would send the book to print.

Crowdfunding works the same way. You have an idea and people ‘buy in’ to the idea, with cash, to help get it off the ground. Effectively sourcing funding from we call the ‘crowd’.

Crowdfunding offers an opportunity to source relatively modest contributions from a large number of people, rather than seeking larger sums from a small pool.

Crowdfunding pulls together a community of like-minded people and allows them to contribute collectively to something they value. One of the things that often sets crowdfunded projects apart is a tangible benefit offered to people who give money. For example, a musician may crowdfund their first album, with those chipping in receiving a copy of the album or a ticket to a special launch event.

For those working in the not for profit sector, there’s no question that crowdfunding can be added to your arsenal of fundraising tactics. It’s one of many ways to raise funds for a project or a cause. But, as with other fundraising methods, there’s a bunch of considerations you need to make, if you want to give it a decent crack.

How does crowdfunding work?

  • You have an idea that needs funding and you work out exactly what it is you want to do and how much you’d like to raise.
  • You choose an online vehicle for crowdfunding and complete information about the project, including uploading videos, photos or supporting documents.
  • For many sites, you offer a range of levels at which people can contribute, with each level having a reward attached.
  • Funders can search most crowdfunding sites by keyword, or they are directed to your project through social media and other communication tools. But mostly, the people who contribute to your project have a connection with you or your organization already.
  • They make a pledge to support your project. They give their credit card details. Sometimes the crowdfunding platform takes their cash straight away. Other times, no money changes hands until your fundraising goal is reached.
  • Once the fundraising goal is reached you receive your money.
  • It is your responsibility to deliver the project, report back to your funders and to give them the rewards your promised.

One of the most important things to consider with crowdfunding, is that it is NOT a passive fundraising vehicle. Crowdfunding will only work if you’re prepared to ask your personal and organisational networks for money. Often. Like, A LOT.

Crowdfunding really works when you’ve already established your ‘crowd’. That is, you’ve got relationships with people who are already committed to your cause and are happy to have the chance to chip in. 

When could crowdfunding be appropriate? 

Crowdfunding works best for projects and organisations:

  • which might be considered unconventional or quirky
  • that have goals which can be very clearly articulated in plain English
  • that already have a large supporter base (particularly social media and email contacts) or have access to strong online networks
  • that can offer something meaningful to people who contribute (whether a physical perk or a unique connection to the outcome being delivered

Tips for successful crowdfunding?

There’s one thing you’ll quickly notice when you check out most successful crowdfunded projects, and that’s the quality of the pitch. We often talk about refining our mission or vision statements or having a good elevator pitch for our community work, but truth be told, there are very few of us who can articulate our project goals in a way that excites those not directly involved. And it’s this pitch, this sharing of the passion, that makes for a successful crowdfunding attempt.

Here’s a few tips for making your crowdfunding efforts worthwhile:

The plan

  • Be realistic with your goal. Some crowdfunding websites only take money from investors once your fundraising goal has been reached. This means that projects aren’t expected to take place if they don’t raise adequate funds. It’s good motivation to accurately cost your project and be realistic with your fundraising goal.
  • Choose the right crowdfunding site. There’s a plethora of crowdfunding websites. Some specialise in creative projects, some are geographically focussed. Do your research, talk to others, see what’s been funded at each, explore what support is available, and pick an appropriate platform to use.
  • Know how you’re going to spend the money. People rarely give to organisations, they give to projects, to outcomes. And people are much more likely to give money when they know exactly how it’s going to be spent. Telling someone their dollars will be used to ‘progress an action plan to develop a strategy to investigate …” won’t get you anywhere. Telling them that bum breathing turtles are endangered and you need to to count how many are actually left in the wild gives people something tangible to contribute to.

The pitch

  • Polish your pitch. Like any fundraising effort, as we mention above, you must have a very clear notion of what it is you are trying to achieve. People will give to projects with a strong pitch. If it’s not compelling, if it’s not plain English, if it doesn’t convey passion and clearly outline the need, then it’s not going to be popular.
  • Video is a winner. By far the most telling thing about successful projects is that they use video to deliver their pitch. With crowdfunding being an online phenomena, you can’t underestimate the power of using simple yet powerful online media. Keep it short (under 2 minutes) and to the point and use good imagery if you can. And for heaven’s sake, make your pitch in the video. Ask for what you want. And tell people what you’re going to do.

The crowd

  • Work the crowd. I guess the whole premise of crowdfunding, is around making the crowd work for you. And as with any marketing, once you’ve built a little momentum, things grow quite quickly. But you must work the crowd. Use your friends, family, staff, members and volunteers to help get word out. Encourage people you know to contribute, no matter how small the amount, and to tell others. Use as many networks as you can to help promote your campaign. Without a crowd, there can be no crowdfunding.
  • Crowdfunding is about relationships. If you haven’t got an audience to start with, you’re not going to be able to market your crowdfunding efforts. How else can you get word out to people about what it is you want to do. You need to look at social media, e-newsletters, hard copy communication, and all of your traditional communication activities and go hard to get word out. You simply have to be comfortable with asking. Asking often and asking specifically for what you need. Instead of a generic Facebook post asking all of your network to give, send Facebook messages, for example, to people you know will be interested and ask them to give a specific amount. 
  • Know your audience. You cannot raise funds without thinking about the people who are likely to hand over their dollars. You must know your audience. What will impel them to give to a cause? What rewards will drive their support? How should you communicate with them? What language should you use? If you don’t think about your audience, you may as well send smoke signals – you simply won’t reach the people you need to.
  • Keep your promises. Make sure you communicate with your investors, keep them abreast of your progress, and most importantly deliver the rewards you promised on time.

The rewards

  • Be creative with your rewards. Considering that many crowdfunding sites ask you to offer rewards in return for what people give – this is a major consideration for a lot of givers. Check out other projects and see what people have come up with. Field tours, farm visits, farm stays, framed photographs, limited edition prints, invitations to launches, open days, autographed books, one-on-one dinners or VIP social events. There’s plenty of options. Be as creative and generous as you can. But bear in mind that sometimes these rewards cost you money. You don’t want to be eating in to your project funds to pay for rewards people might not use. 
  • Offer rewards at different levels. There seems to be some evidence that campaigns with smaller reward levels on offer, are well supported. That is, offering rewards around the $10-25 contribution mark, often lead to many small contributions which quickly add up. That’s not to say you shouldn’t aim big with some bigger dollar rewards, but don’t forget the small fry.

Finding funds for community projects is always a challenge, but there’s no reason to have all your eggs in the one basket. Between government and philanthropic grants, donors, sponsorship and modern tools like crowdfunding, you can reach different audiences for different purposes and get more good stuff happening where it needs to.