Crowdfunding: how it works, the do’s and the don’ts

After launching a successful on-line fundraising campaign for my primate project this year, I was asked to give a talk about “crowd-funding” at the first ever Primate Society of Great Britain student workshop.

Many people said they were unaware of the crowd-funding requirements, and so I have made this simple guide to show how it works and give some general tips.

FUNRAISING

  1. CROWD-FUNDING, WHAT THE? Crowd-funding is an online website which allows people to donate to your project (for example, mine was to raise money to buy materials for a new monkey enclosure). Simple!…or so it seems:
  2. TOO MANY SITES NOT ENOUGH TIME: You must must must do your research in choosing the right crowd-funding site-what are the site fees? (yes there are always fees, even free money has a cost), what are the sites policies and is your project applicable? (Kickstarter for example does not allow money to be raised for causes! Always read the rules before starting your campaign as it could be taken down), is there a time limit and if so do you get to receive the funds if you don’t make it? Is your project urgent, would a time limit help or hinder your project?

BASIC PRINCIPLES:

  1. FEES: The joy of finances! …not. OK so all crowd-funding sites have fees. SITES THAT CLAIM TO BE 100% FREE WILL CHARGE YOUR DONORS! Never charge your donors for giving you free money…ever, such a bad idea! Fees may seem like a lot but in reality they’re not, you will get far more money raising online than in person and so the cost of the fees is outweighed by what you gain. Site fees vary, the site I use (gofundme.com) charges 8% of every donation (approximately 50p of every £10 donation). But wait! That’s not it! You then have to pay your paypal fees! (0-4-1.5% if paying from a bank account or between paypal accounts, 2.4% + 20p from credit cards)…and there’s more: paypal charges higher rates if your donors are from abroad- best bet is to ask these donors to transfer money directly into your PERSONAL bank account, and then add this amount as an ‘off-line’ donation (which I explain in the offline donation section).
  2. TIME LIMIT: Again sites vary, but a common theme is to have a time limit for your campaign-say a month or two to raise £x. But watch out! This can be a two edged blade- Yes the urgency of a fast campaign can spur your supporters into donating (none of the “I’ll wait til the second pay day of the third month before I donate, oh wait sorry I forgot” excuses) BUT what if you don’t reach your target in that time? Some sites will give you NOTHING, some sites charge you a fee (a failure fee essentially, how depressing!) and some sites do not let you extend or reduce your time limit-please please please remember that essentially you are gambling other peoples well-earned cash.
  3. TARGET: So you have a crowd funding site, you have a great project idea and you want to start raising some £££…but how much?? Your target is something all crowd-funding sites will have, it will show your supporters how much money you want to raise (ie, your target), how much money you have raised and how much you need to go-this is usually shown in percentages. This is a genius idea as psychologically people are more inclined to donate if you you say you need 5% more to reach your target than if you say you need the money equivalent of 5% (I dunno, lets say £146.70…thats just not exciting, but 5%??? wow thats so close I’ll help you out!)-you get the idea.
  4. ADDING MONEY OFFLINE: Yay a way to cheat the system! So someone has transferred you money from abroad into your own personal account or they have given you cash in person, you can simply add this to your crowd-funding site by using the ‘add offline donation’ button. The amount will then be added to your site, making you look really successful, which is always nice. This way your ‘money raised’ amount keeps going up which spurs people to keep donating and allows you to keep track of your overall amount whether it be online or in cash.
  5. REWARDS: For some sites it is mandatory to offer rewards, and others it is optional. I’m on the fence when it comes to offering rewards, in one sense its a nice incentive but on the other hand its an extra expense to you and you need that money for your project, plus nine times out of ten people judge the reward based on the cost (for example, you offer to send a postcard to them from your field site if they donate £10…immediately people think a post card is worth way less than £10-my advise-don’t put a value on their donation). In my experience incentives work much better- “just £10 buys one monkey a rope ladder to help them learn to climb and express species-typical behaviour, a big part of locomotive rehabilitation”. Plus the cute factor helps, not gunna lie.

THE TIPS….WOOO

  1. WRITING YOUR BIO-keep it simple, no really-simple.
  2. PROMOTE PROMOTE PROMOTE! Share your link-every day! Add it to your twitter bio, blog about it, spam it all over facebook and twitter. It’s advised that you spend about 20 minutes per day on advertising and promoting your project, yes it’s an online donate at the click of a button deal, but it’s not easy-it takes work, time, and dedication. I found the best approach was to write out individual personal messages to friends, family and acquaintances with a brief description and a link to the site. If I see a donate link on my facebook news feed, I keep scrolling. If someone messages me personally (and with my name!!?…boy oh boy do I feel special), then yeh I get suckered in and I donate.
  3. SAY THANKS AND KEEP POSITIVE-there is nothing more revolting than crowd-funders spamming my facebook with whining ungrateful negative updates. I don’t want to hear “please I just need £20, it’s only £20!”….it might just be £20 to you but that’s 3 hours of my working life that your asking me to give you! Be positive. Say thank you to every donor, no matter how big or small their donation. Send a personal thank you email, name them on facebook and twitter and acknowledge them on your crowd-funding site.The feel good factor-it’s a charmer 😉
  4. MEDIA-Videos are amazing! People love to see videos to see what you are doing with the money, to feel part of your project and to share with their friends. Photos are also powerful, use them wisely. If it can be said with a picture or words, use a picture-I’m sure there’s a saying about that somewhere right?

4605700042So that’s the crux of it-now feel prepared to be ‘that person’ asking for money from people every day, but be passionate and you will do great things. Be sensitive to your supporters, and remember everything is representative-try and see your donation in relation to the minimum hourly wage- if someone gives you £10 then they have worked almost 2 hours for free, to give you that money, that is a great thing and extremely kind. Be grateful, enjoy the experience, and good luck!

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s