Interview with Dawn Bebe, Co-founder & Director of Crowdfunder
You’ve obviously been very successful in the media field, when & why did you set up Crowdfunder?
I and my co-founders noticed something happening in America called crowdfunding, an interesting idea and could help connect people & resources so we set about trying to develop a platform.
There were already a couple of platforms in America, Kickstarter & Indigogo that were well known but it was very early days in UK terms. We launched about 3 years ago and now we are the number 1 crowdfunding platform in the UK.
What makes crowdfunding different from other ways of raising money?
It involves promotion of your project to a crowd who then pledge money on your great idea in return for a reward. This can be a product, benefit or service so something in kind that you give back to the people who have pledged money. In this way it’s quite different from going to the bank and applying for a loan or applying to a funding body for a grant.
A lot of our readers work for tiny charities, if you are within a small organisation are you able to provide anything in the way of rewards?
Yes, rewards don’t have to be anything expensive so you could perhaps offer a tweet of thankyou. Often people offer unique money can’t buy experiences so for example if you were raising money for a park or a new trail say you could be the first person to walk along the trail or you could have a party at the end of the trail for you and your friends so things that don’t necessarily need to cost a load of money but you need to be creative with what you offer back.
The site has to make money so is there a charge?
We charge 5% upon success, so if a project successfully hits their target we charge 5% of the money that you raise. If projects are worried about that 5% we suggest they put their target up by 5% to cover the cost.
There are 2 ways of crowdfunding; first is all or nothing and you set a target, if you don’t reach that target no money is taken, the pledgers don’t give anything. The other is flexi funding where you set a target but you keep what you raise, there would then be the charge of 5% on the total reached.
Do people have to be technically savvy to use the site?
No you don’t have to be, the site is very simple to use and if you can send an email or take a picture or video on your phone then you’ve probably got enough skills to be able to do it. We also recommend if people lack some of the skills needed that they get in a team to help them. So older people might ask their grandchildren or friends to help write the copy or make the video. We strongly recommend you don’t do it on your own.
Setting up the project does take time as with anything but you have to weigh it up against not having the money or applying for loans &/or grants. People will comment afterwards that they got the money quicker than if they had applied for a loan or grant. Essentially once you’ve set up your project and you start to crowdfund you’ve set a length of time, typically 30 to 60 days for the project to run, once you’ve hit your target and the fundraise ends you get the money within a couple of days so it depends how you view the time it takes & time vs effort.
Lots of people do small raises, for example £100. The average project on the site is about £2000 but we have had people raising as much as £350,000 for much bigger projects.
Find out how it works http://www.crowdfunder.co.uk/how-it-works
Do you do any form of promotion of projects or does the project owner promote themselves?
You need to be able to promote the project yourself. One of our first tips is to identify your network and potential backers. Crowdfunding works best when the first people to pledge are close to you, simply because if those people are not prepared to give you money it will be seen as a poor idea by the crowd.
On the website there are downloadable tips & guides to read and find out how to crowdfund successfully. When you add your project to the site the system starts coaching you automatically so it starts giving you advice on what you need to do. We also offer coaching via phone and we run a series of google hangouts and online workshops that people can join and find out how to crowdfund so there’s a whole raft of help & advice that people can access through the platform.
What sort of projects can the site support?
There are three types of project typically on Crowdfunder: charities, businesses & those that have community benefit. We have just launched a facility for projects to be able to receive pure donations so enabling people to just donate, without receiving a reward so in that sense it makes it even more suitable for charities. We would never suggest that people put a page up requesting money in general, the crowd wants to know what the money is going to be used for & how much the project owner needs so a very unfocussed project doesn’t tend to be very effective & the crowd doesn’t tend to want to support general costs.
On Crowdfunder we also have Plus Funders facility where we hold details of grant funds. If a project is added that meets a grant criteria, the project owner will be alerted to the fact that they may be eligible and given the opportunity to apply to the fund. Although some of the grants are already out there the majority are exclusive to Crowdfunder. In essence we form partnerships with a variety of different funding partners. To give an example: Crowdfund Birmingham is a campaign launched to fund Birmingham, at the heart of which is £470,000 worth of available funds, the campaign is also offering free crowdfunding courses to help people raise the money they need.
Do you consider the site to be a one stop shop for fundraising?
Yes it can be, often projects come in attracted by the funding we have on offer but once uploaded their project attracts funding via the crowd anyway. There are two elements: the fact you can raise money relatively quickly from the crowd but also that you can source some additional funding through one of the grant funds.
Have you got any advice on setting up a successful crowdfund?
We have a lot of crowdfunding for environmental & community projects, like coast paths & tree protection to name a couple. The most important advice is to plan your project: think about how much you want to raise and who the people are that will help you raise it.
The rest is telling your story really effectively, making sure you shout about what you’re doing and get people engaged with the project. You don’t have to have an expensive, fancy video, you just have to convey your message successfully. An example of a successful project is Butterfly Conservation’s ‘Why are our butterflies disappearing’ which raised £6800 from 307 people
There are a whole range of tips and guides on the site that people can look at.
Crowdfunding is a good way to learn to fundraise better isn’t it?
Yes, we think of crowdfunding as building social capacity, capacity within communities; building skills & employability skills in people. To be able to crowdfund effectively you need to be able to market your idea, you need to be able to communicate & explain what the project is, be able to promote it, do some online work, create a video and be able to fundraise & effectively target people and ask them to support the project with money. All those skills are transferrable and generally speaking are needed for running a small business or organisation.
Our youngest crowdfunder was Dylan who was 7, for his recipe book project. If Dylan can do it then most people can have a good go. We’ve got crowdfunders who are in their 80’s so it works right across the ages.
Finally what developments have you seen in fundraising?
The rate of growth in the crowdfunding market is absolutely massive so increasingly it is the first point of call for people who want to raise money. It’s a great way for grassroots organisations or early stage businesses to provide the seed funding to get their idea happening. We’re now raising in the region of £1million a month for organisations and we’ve raised £34million for projects across the UK in the last 3 years.
We are increasingly doing fund distribution for other organisations and are in active conversations with many local authorities and development agencies like LEADER and community infrastructure levy funding bodies. We are talking to lots of people across the UK about using their funding in a different way to reach different projects with matchfunding.
All the work of fund distribution is online with Crowdfunder so funding bodies are finding this is an effective way of distributing their fund, they come to us to administer their fund distribution and in this way they can give knowing the projects they are supporting are wanted by the crowd, they are validated by people who are matching funds with their own money.
To give you some ideas check out The Reef Project, currently crowdfunding to help create the world’s first multi purpose, modular artificial reef and marine habitat. http://www.crowdfunder.co.uk/arc-marine