Crowdfunding for development: fad or future?
19 Sep 2014 by Benjamin Kumpf, Knowledge Management Specialist
Steady growth and, for now, no end of the trend in sight: the crowdfunding market keeps expanding across the globe. Crowdfunding describes the practice of securing funding for a specific project or business venture by a dispersed group of people with some shared interests, “the crowd”. Most crowdfunding initiatives are dependent on whether they raise the targeted amount from the crowd. If the funding goal is not met, the project will not take off.
It thus differs to charitable donations which usually support the respective organization’s general mission without knowing exactly how the money will be spent. UNDP has been experimenting with philanthropic crowdfunding and has had some early successes. For example, colleagues in Croatia successfully raised $10,000 for an energy-independent school in Croatia. The sum might be fairly small but the experience showed: crowdfunding can create a buzz for development work and social causes as the unwritten rules of crowdfunding require development organizations to communicate constantly and in a non-technical jargon what concretely was achieved.
UNDP has also had some experience ‘failing’ with crowdfunding initiatives. As the saying goes: “Failure is only the opportunity to begin again more intelligently”. Based on lessons thus far, we developed guidance document for UNDP colleagues to learn from experiences to-date. This is work in progress and will be constantly updated. We welcome comments and suggestions for changes. Click here to access the document and join the discussion.
To further consolidate this guidance document, to learn from experts coming from the crowdfunding sector and to kick start initiatives in Country Offices, UNDP is hosting the event ‘Crowdfunding for Development’ from 22 – 23 September in Amman, Jordan. The event is part of UNDP’s global campaign ‘SHIFT Week of Innovation Action’. For more information on SHIFT and the global event schedule, visit our site and follow #inno4dev on Twitter for updates, including live-streams from the event. We will broadcast lectures of crowdfunding experts live from Amman.
In the meantime, talk to us: is the guidance on crowdfunding comprehensive? What is missing and what experiences can you share in philanthropic crowdfunding for development?