2011/03/09

Crowdfunding: Making it easy for people to support good ideas

Crowdfunding is an internet-enabled way of making it easy for people to support good ideas by providing a platform to:
  1. Publicize a good idea and let people know how much money is needed to make that idea happen.
  2. Easily contribute money which will let the project founders start working on the project or move further ahead on an already-launched project.
Wikipedia currently defines 'crowdfunding' as
"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. Crowdfunding occurs for any variety of purposes, from disaster relief to citizen journalism to artists seeking support from fans, to political campaigns, to funding a startup company or small business[1] or creating free software."
Three of the larger and more well-known crowdfunding websites are Kickstarter, IndieGoGo and RocketHub. A relatively new site, focused on crowdfunding for 'social innovators,' is StartSomeGood, which is explained in this recent post on Dowser.org.

The reason for writing about crowdfunding is to generate discussion about what cool, creative, worthwhile projects DHMN (Distributed Hacker/Maker Network) could organize and launch. Seeking outside funding for a project provides several benefits to DHMN:
  1. Help focus the skills, knowledge and passion of DHMN members for a cool collaborative project with identified, tangible results.
  2. Provide an effective marketing tool to increase awareness of DHMN in the Fox Valley
  3. Provide an opportunity for DHMN members to become more effective at free or low-cost internet marketing and social media marketing.
  4. Create an opportunity to do targeted intentional networking and recruiting of new members to DHMN.
  5. Provide an important reason to build v. 2.0 of the home page for dhmn.net and to 'make' a high quality 'About Us' video.
Two Wisconsin projects that pursued crowdfunding are UberDork Cafe in Milwaukee and the iHYPE in Appleton. UberDork Cafe was seeking $5000 to pay for "...the business essentials (i.e. licensing costs, permits, etc), necessary start-up supplies and first month's rent" for a new Milwaukee coffeehouse with "a family-friendly environment that supports local vendors and artists, the earth and gives back to the community not only by providing a safe place for youth to play and learn, but also in financially assisting future Art + Science= Geeks." The founder of UberDork Cafe said the $5000 funding target was about 1/3 of what she needed to open the cafe. She ended up getting support pledges totalling $6735 from 116 backers.

The other Wisconsin project mentioned above seeking crowdfunding is iHYPE (I Hold Your iPad Everywhere). An Appleton resident has designed a multi-functional holder for an iPad, made a plastic prototype of it at the FVTC Fab Lab, and is now attempting to crowdfund bringing the iPad into commercial production. This Kickstarter project is still open for pledges (deadline is June 2, 2011), but the founder has not effectively marketed his Kickstarter crowdfunding effort. To-date, there is only $50 pledged for the iHYPE project from one backer, and the project goal is $73,137. With a reasonable amount of planning and communication, he should have been able to get at least five or ten backers by this point from the 3F category (family, friends, fools) of early stage investors for entrepreneurial ventures.

In addition to crowdfunding, there are also corporate funding sources for innovation projects. Two current examples are the Pepsi Refresh Project and the GE Ecomagination Challenge. An example of how hacker/makers can try to be involved in these corporate project funding programs is the AHA hackerspace (Ann Arbor, Michigan) project submitted to the Pepsi Refresh Project for programming DNA with a "Hello World" program (video here).

Bottom line is that DHMN should consider developing one or more interesting and worthwhile projects for which we could go after funding through one of the above websites or through other funding sources for creative and innovative ventures.

*****

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