The Wisdom of the Crowds: how Crowdfunding is changing the way we create things
Paul Archer left a grown up job (with a tie) to go on adventures and now runs the Daredevil Project. Here he talks about Crowdfunding and Kickstarter.
On October 31st, the American phenomenon of ‘Kickstarter’ became available in the UK for the first time. Previously only available to those with American bank accounts, British citizens can now try this peculiar approach to raising funds.
The Internet has changed so many aspects of our lives; from the way we communicate and discover information to the way we shop, the way we date and the way we procrastinate (generally through the watching of musical cats, Korean pop hits and Germans jumping into frozen pools). Now it’s changing the way we can fund artistic and business projects by breaking down the barriers of entry and allowing the masses to decide what succeeds and what doesn’t.
What is Crowdfunding?
Kickstarter is based around the idea of ‘Crowdfunding’. Instead of going to your bank manager or a cigar-smoking Venture Capitalist, your project is instead funded by lots of small pledges from many different individuals.
The projects themselves range from the wildly successful – a design for a new video games console received over a million dollars worth of pledges on its first day – to the less popular – a dating boardgame called ‘Single Again’ and “complete with stalkers, vindictive exes and cock-blocks” failed to secure any pledges towards its $15,000 target.
However, the important thing about Kickstarter is that the funding is all-or-nothing; projects can go over their targets (the games console eventually raised over $8m dollars of a $950,000 target) but if they don’t reach it then they don’t get any of the funding.
So even if you raise £999,999 of your million pound target pledged when you hit your deadline then all the money would be returned to the backers and you wouldn’t get a penny.
You probably know that Escape the City was funded in a similar manner, using a service called Crowdcube to sell shares in the company.
But what if you don’t want to start a kick-ass tech start up and just want to get a bit of a project off the ground? Crowd funding may still be the answer. Cutting out the middleman and taking the product straight from the creator to the customer could create a completely meritocratic market.
Losing the quality filter
But then again, maybe cutting out the middleman isn’t all-good. I can’t help but think that in the case of publishing, film, photography and numerous other areas, cutting out the ‘filter’ that professional commissioners with years of experience provide could result in an drop in general quality. Although Kickstarter curates every project, they’re not necessarily experts in their field, so you would expect it would leave the doors open for a deluge of amateur, low quality work. Interestingly, this doesn’t seem to be the case (although the failures are less likely to get attention). Apparently 10% of films featured at the Sundance Film Festival were Kickstarter projects – which may say something about the taste of the ‘crowds’ who funded them over the Hollywood experts. And ultimately, it’s down to the crowd to buy the finished products anyway, so why not give them the choice?
Making it work
My experience with Kickstarter has been as a spectator. It started in 2011 when my friends and I foolishly drove a black taxi around the world. We maintained a blog of the expedition, filled with pictures and stories of the bizarre/hilarious/terrifying/
‘Yes!’ Would be the response, ‘of course!’ we would cry, with no understanding of the shear magnitude of work we had inadvertently signed ourselves up to.
Six months later, it’s still in the pipeline and due in the Spring. However, a proper book, unlike a blog, generally doesn’t use photos to illustrate the stories, meaning the tens of thousands of stunning photos taken along the way by the expedition photographer, Johno Ellison, will be wasted. Unsurprisingly, he was keen to find out a way he could share his images.
He called me up the other day and told me he had figured out an outlet for his pictures; he would create a separate ‘photobook’ in time for Christmas and use the newly available Kickstarter to fund it.
He explained how it was going to work for him. He would offer people the opportunity of getting a sparkling hardback copy delivered in time for Christmas in return for paying up front for the book. To do this, he had to raise £4500 within two weeks to pay for the books to be printed and shipped in time for Santa’s sack – a seemingly impossible task (you can see his pitch here).
However, through Kickstarter, Johno has raised £2200 in just over a week and is gaining more and more interest in the project. If enough people pledge to buy enough books to raise the £4500 needed in the next 5 days, then the book gets printed, people have one less Christmas present to buy, Johno’s photos get seen and everybody wins.
If it doesn’t? Well, nobody wins, but then nobody loses either.
(Except the poor bugger who ends up with Jessie J’s biography in their stocking instead)
Support Johno’s Kickstarter: http://www.kickstarter.com/
Follow Paul on Twitter https://twitter.com/Paul_K_