What  is  Crowdfunding  

How  crowdfunding  started  

1885  

When  was  the  first  reward  based  

crowdfunding  project  launched?  

Seriously?  

•  The  statue  was  a  diplomaAc  giB  to  the  US.  However,  the  US  had  been  unable  to  raise  $250,000  for  a  granite  plinth  for  the  statue.  

•  A  group  called  the  American  CommiKee  of  the  Statue  of  Liberty  was  tasked  with  raising  the  money  but  fell  short  by  more  than  a  third.  

•  BalAmore,  Boston,  San  Francisco  and  Philadelphia  offered  to  pay  for  the  pedestal  in  return  for  the  statue's  relocaAon  

What  to  do?  •  New  York  had  run  out  of  opAons.  •  They  were  $100K  short  •  Pulitzer  decided  to  launch  a  fundraising  campaign  in  his  newspaper  The  New  York  World.  

So  what’s  new?  

•  Internet  –  increased  reach  •  Social  –  easy  to  share  •  Mobile  –  at  your  fingerAps  •  Ease  of  use  –  no  technical  barriers  •  Economy  –  shortage  of  funding  •  Startups  –  support  new  innovaAon  •  Increased  need  for  charity    •  Healthcare  –  treatment  expensive  

Four  Crowd  Funding  Models  

•  DonaAons  

•  Rewards  

•  Equity  

•  Lending  

DonaAons  

•  Backers  contribute  very  small  amounts  of  money,  typically  <  $25    

•  No  expectaAon  of  a  return  •  Acknowledgment  of  contribuAon  to  a  worthy  cause  •  Donors  oBen  receive  a  thank  you  in  a  program  or  liner  notes  

•  Beneficiaries:  TradiAonal  chariAes    •  Market  may  be  worth  more  than  $500  million  in  2013  

Rewards  

•  Businesses  and  non-­‐profits  of  all  sized  post  projects    •  Target  a  certain  amount  capital  to  raise  •  Presales  tool  •  MarkeAng  iniAAve  •  Some  type  of  incenAve  for  parAcipaAng  •  Types  of  rewards:  T-­‐shirts,  giB  cards  or  products  manufactured  by  the  “crowdfundees”  

Equity  

•  Significant  increase  in  popularity  since  the  passing  of  the  Jobs  Act  (the  US)    

•  Small,  private  companies  or  entrepreneurs  can  raise  Series  A  capital  or  seed  funding      

•  Avoid  personal  debt  in  order  to  fund  a  project  

•  Investors  receive  actual  stock  from  the  company  

•  An  incredible  tool  for  small  startups  -­‐  a  combinaAon  of  markeAng  and  fundraising.  

Lending  

•  Borrowers  choose  a  loan  amount,  purpose  and  post  a  loan  lisAng.    

•  Investors  review  loan  lisAngs  and  invest  in  lisAngs  that  meet  their  criteria.    

•  Once  the  process  is  complete,  borrowers  make  fixed  monthly  payments  and  investors  receive  a  porAon  of  those  payments  directly  to  their  Prosper  account.  

Pros  

•  Raise  Money    

•  Raise  a  producer's  profile  and  provide  a  boost  to  their  reputaAon    

•  MarkeAng  and  customer  validaAon  &  feedback    

•  Audience  engagement  in  producAon  process,  sharing  feedback  via  comment  features    

•  Good  place  to  test  the  market    

•  Increase  the  likelihood  of  venture  success    

•  Retain  control  of  their  operaAons,  as  voAng  rights  are  not  conveyed  along  with  ownership    

•  Performance  based  payment  

Cons  

•  ReputaAon  at  stake  –  failure  to  meet  campaign  goals  may  impact  the  future  funding  opportuniAes    

•  Unable  to  deliver  on  a  project  can  severely  impact  one's  reputaAon    

•  IP  protecAon    

•  Donor  exhausAon    

•  Public  fear  of  abuse  or  scam  may  become  a  barrier  to  public  engagement.    

•  Managing  communicaAons  can  be  a  diverAng  task  

Best  PracAces  •  Don't  rush  into  your  campaign  •  Put  a  lot  of  thought  and  research  into  your  funding  goal  

•  Give  your  investors  different  levels  on  which  to  contribute.    

•  Include  a  video  in  your  pitch  •  Have  money  already  commiKed  before  you  go  to  the  crowd  

•  Be  acAve  online.  Really  acAve.    •  Find  and  reach  out  to  an  audience  that  cares  •  Be  relevant!  

   

#1  BIGGEST  CHALLENGE    Lack  of  exposure  

Biggest  Myth    

EvoluAon  

Biggest  Concerns  

FRAUD

Planorm  features  •  Run  campaigns  enArely  on  your  own  website,  on  the  

network  or  distribute  your  own  content.  •  Integrated  social  media  tools  •  Run  mulAple  campaigns  under  one  account  •  Offer  rewards  or  incenAves  •  “Keep  All”  campaigns  or  “All  or  Nothing”  campaigns  •  Fraud  management  tools  •  Real-­‐Ame  tax  receipAng  •  Performance-­‐based  cost  •  Detailed  analyAcs  •  Over  $52M  raised  on  the  planorm    

Target  VerAcals  •  Arts,  Crea*ve  &  Fashion:  fundraising  for  film,  music,  

wriAng,  design,  dance  and  other  creaAve  projects.  •  Business  &  Entrepreneurial:  fundraising  for  small  business,  

start  ups,  ideas  or  projects.  •  Community  &  Volunteering:  fundraising  for  community  

groups,  volunteers  and  projects.  •  Educa*on  &  Schools:  fundraising  for  books,  classes,  

equipment,  groups  or  other  learning  needs.  •  Non-­‐Profits  &  Charity:  fundraising  for  projects,  events,  

causes  or  programs.  •  Sports  &  Events:  fundraising  for  athletes  and  teams  for  

travel,  training,  tournaments  or  equipment,  concerts,  fesAvals  and  other  special  events  in  the  community  

Our  Approach  

Fuellocal.com  

Curated  content  Promoted  content  

The  opportunity  

•  MoneAze  current  organizaAons    that  we  currently  promote  for  FREE.  

•  IntegraAon  of  content  through  editorial,  website  secAons  and  in  print.  

•  CreaAon  of  special  secAons.  •  Partnering  with  local  incubators,  BIA’s,  local  development  councils.  

•  PromoAon  of    local  success  stories.  •  Develop  local  corporate  social  responsibility  sponsorship  program  with  adverAsers  through  rewards  and  ads.  

•  InnovaAon  for  NaAonal  AdverAsers  

Fees  

•  Planorm  only  –  7%    •  Planorm  plus  PromoAon  –  15%  •  Up  sell  –  Paid  promoAon,  special  secAon  etc  

Examples  

Ardglen  Fire  

Summary  

•  It  is  sAll  early  days  and  lots  to  learn.  •  Connected  to  the  community.  •  Trusted  brand  and  local  voice.  •  Ability  to  promote  select  campaigns  in  print  and  online.  •  Use  crowdfunding  as  a  tool  for  other  revenue.  •  Create  good  content.  •  We  have  the  secret  sauce.    •  Daily  deal  mentality.