But what is crowdfunding?
In short, as the name suggests, crowdfunding involves raising a certain amount of money for a project through a large number of people pledging small amounts of cash within a given number of days (42 in my case). The 'crowd' pledge money in exchange for rewards, via the web. It's the exact opposite of going to a bank and asking for the whole lot from one investor.
A lot of crowdfunding initiatives are 'all or nothing' (such as mine) which means that if the project does not meet its target by the deadline, i.e. not enough people make pledges to meet the target, there will be no money and no one pays anything. If enough people make pledges and the target is met, everyone pays what they pledged. This means that only projects that have a lot of support from their community will be funded. It also means that both project owners and backers have to tell people they know that it's a great idea, via social media and word of mouth, so that the campaign gathers momentum and more people get to know about it.
All very straight forward, right? Yes, but if you're in my shoes right now, that doesn't stop it being, quite simply, really daunting.
The idea that I am about to stand up in front of all my family and friends, colleagues and clients, and tell them that I've had a great idea and that I need their help makes me feel a little bit wobbly. I need people to agree with me, to back me with a donation and to then tell everyone about it. If it works, then great, I don't mind everyone knowing. BUT, if I fail to meet my target then everyone I know will know that I've failed.
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| 'lone nut' |
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If you haven't seen Derek Sivers' TED talk about How to Start a Movement then I suggest you do. It's a short and amusing talk and in it he uses a clip of one man at a festival dancing wildly on his own in the middle of a field to demonstrate how ideas catch on. Until another festival goer joins him, the dancing man is just a lone nut doing something that no one else is. When the second person arrives and joins in, it validates the lone nut and people begin to think that maybe he's not so crazy/drunk after all. Once a couple more people start dancing, they begin to look pretty cool and eventually there is a whole group of people in that field dancing wildly. So much so that many of those who aren't dancing begin to feel like they should be and join in too.
This is a perfect example of the law of diffusion of innovation. Put very, very simply, new ideas spread through a small number of people adopting an idea early on and telling others how great the idea is. This makes others investigate, adopt and do the same. Eventually, if you're not doing it, you're not cool. Unsurprisingly, this is exactly how crowdfunding works too.
At the moment, I feel like a lone nut dancing wildly in a field. The music is great and my dance moves are like nothing you've ever seen before. I need some people to join me and start dancing too. Eventually, with enough people, we'll be so cool that everyone else will want to do it too.
www.crowdfunder.co.uk/gowild (live from midday on 22nd April)
