Cities are becoming the front lines for innovative funding models like venture philanthropy and crowdsourced funding. The stock market is gyrating wildly, city budgets are being pushed to the limits and banks are holding their money tighter than ever. If you’re trying to launch a new project you know how hard it can be to raise capital. Some local entrepreneurs are turning to crowdsourced funding platforms as their primary means of raising money.

Rachel Pandich was part of a group who raised over $100K on Kickstarter. She says “consider and plan for fees”. Her total project fees: $9,000 (5% to Kickstarter & 4% to Amazon) & $6,000 in “errors” such as bad card numbers.

What Does it Mean to Crowdsource Funding?

Crowdsourced funding is the collective cooperation, attention and trust by people who network and pool their money and other resources together, usually via the Internet, to support efforts initiated by other people or organizations. Easy enough.

How Do You Get Started?

There are many funding platforms to choose from so begin with a little research. Kickstarter is the largest and most recognizable. Their name recognition and existing project eco-system may provide an additional level of comfort to potential contributors, so choosing Kickstarter may give you an added advantage.

Ulule and Indiegogo are two other funding platforms people in Jacksonville are using. Regardless of platform, in the end you need to build trust with potential contributors. Our advice for each service is:

1. read the about pages, the rules for each service varies slightly
2. understand the percentage of money each service takes from your final earnings
3. talk to people who are currently running projects by exploring projects from Jacksonville (Kickstarter, Ulule, Indiegogo)
4. be very professional and communicate frequently on your project page
5. give yourself time to plan how you will execute your project before jumping in and creating a project

This last step is essential. Casey Ayers who recently wrapped up a funding campaign on Kickstarter had this to say. “Take your time. We spent more than two months putting together our prototype before launching our Kickstarter project. We went through many iterations and waited to post our project until we thought we could do a good job of conveying our idea.”

Make the $50-$100 contribution levels the most rewarding and appealing to potential donors. 5 Kickstarter tips from Andrew Fallon

Study Up Using Kickstarter School

Kickstarter recently published Kickstarter School which provides a great wealth of knowledge on starting, executing and following through with your project. It took us about 15 minutes to read all 8 sections and we highly recommend reading it before jumping into a new project.

Don’t be Fooled, Crowdsourcing Funding is a Challenge

For every story you hear about people meeting and exceeding their goals on one of these platforms, there are likely 20 stories of people who didn’t. Here is a sobering article from Coffee and Celluloid about the Good, Bad and Ugly of launching a project on Kickstarter.

Your passion to raise money and the amount of hard work you put in will go a long way towards determining the success of your campaign. But hey, that’s true of launching anything.

If you would like us to connect you with a Kickstarter Alum, leave a comment. There are many people who have successfully and unsuccessfully crowdsourced money for their project in Jacksonville who you can learn from.

A Local Project Worth Funding: Reviving the 5 Points Theatre

Tim Masset, who helped build a following at the San Marco Theater, plans to re-launch the 5 Points Theatre in a couple months. He is using Ulele and plans to raise $95,000. For much more on this project, read 5 Points Theatre to Re-Launch with New Ownership and Funding Campaign. Urban Jacksonville has also issued a matching challenge program to help raise funds for the theatre.

“If he pulls it off, it would add a vital cultural spark to an eclectic collection of close-in neighborhoods that would welcome such a spruced-up amenity”, Riverside Avondale Preservation founder Wayne Wood via Jacksonville.com

Resources For Raising Money With Crowdsourcing

• Kickstarter School
• Funding Lessons from a Successful Kickstarter Campaign
• How Crowdfunding Can Get You Money Online