Crowdfunding offers a new model of audience engagement that contract bidders — who often believe we are talking to an audience that is already sold on what we do — could learn a lot from. Crowdfunding is a social media platform through which millions of dollars have been raised for projects as diverse as a Parma and pot at the local pub ($259 against a target of $20) to millions of dollars of fan funding for a movie version of the TV series Veronica Mars. In the crowdfunding world, the only measure of a project’s worth is whether people will stump up money for it. Most crowdfunding goes to projects that it would be difficult - if not impossible - to get traditional funding for.
There is definite hierarchy in the business of raising money to do stuff.
At the top are products and services that are deemed essential to corporate or public life. These are funded by governments or businesses through contracts and agreements.
In the middle are traditional grants, where hopefuls parade their wares in front of an entity that has money and is prepared to give some of it away (generally a large corporation, charitable foundation or private donor).
Crowdfunding is at the very bottom of this pyramid. This is a very interesting place to be, in that crowdfunders are talking to a very wide audience that may or may not have any money - and even if they do, have no intention at the moment of giving any of it away. This forces crowdfunders to put their project in front of everyone they know in a way that is so inspiring that it will prompt them to immediately pull out their credit card.
Check out Part 2 of this article for my top four lessons for contract bidders from the most successful crowdfunders.