Crowdfunding for nonprofits – what it is and what it isn’t
Crowdfunding is exactly what it sounds like—leveraging a ‘crowd’ to fund a cause, project, venture or sometimes even a person. While today crowdfunding means using Social Media and other online sources, it’s been around for a long time. Think of a community coming together to build a barn or care for a family in need after a devastating accident or illness. After a disaster such as a tornado, flood or earthquake people come together to help support survivors, rebuild communities and care for the injured. While there are often large donations from companies and countries, a huge share of the funds raised is small donations from individuals – a whole lot of them. More and more these campaigns leverage social media, just as President Obama did in funding his presidential campaigns in both 2004 and 2008.
By now just about everyone has heard of at least one crowdfunding site – the most familiar ones are for personal expenses or product launch funding. Surely we’ve all been approached to support a Kickstarter or Go-Fund-Me campaign. But there are several sites dedicated solely to nonprofit fundraising, features may be different on each site, but most have the nonprofit set-up an online fundraising campaign and accept money directly using the website’s credit card processor. Individuals can also set-up a fundraising page to support their favorite charities as well as ‘team’ crowdfunding. Teams can compete with each other to see who can raise the most support, and by recruiting their own friends to their team the nonprofit reaches a much larger community.
Crowdfunding is a great tool to add to a nonprofit’s fundraising array to complement and enhance the other solutions. But to be clear it is not a panacea for all of a nonprofit’s funding woes. You don’t just throw together a campaign, forget about it and raise a million dollars while you are off doing other things. Donors and potential donors need to hear from the nonprofit on an ongoing basis. They want to be updated on the campaign’s success, how the funds are or will be helping fulfill the mission and even the status of some friendly competition.
An important part of a successful crowdfunding campaign is the preplanning phase. As much as two months before the nonprofit launches their campaign they’ll want to rally their supporters, get some initial donation commitments (some experts suggest as much as 30% of the goal should be prefunded before the launch). A marketing and publicity plan are also huge components of a successful campaign.
Achieving these goals is not impossible but for most nonprofits, it requires support beyond a tutorial and tip sheets. Having someone supporting the nonprofit’s efforts, helping capitalize on their strengths and guiding their efforts will help guarantee success. The personal one-on-one coaching offered by Digital Donations’ CrowdGIV platform is unique in the market by providing these services.
Crowdfunding allows people to support projects and causes that are important to them. Utilizing Social Media sites and email to access its vast and ever growing network a nonprofit’s mission can spread far and wide.
The best crowdfunding campaigns will strengthen your brand, clearly express your mission, dazzle your donors, and commit them to your organizations success well beyond the end of the campaign. And of course, raise the funds you need!