Last month I wrote about good design. Some of my research for developing world designs took me to a crowdfunding site called “The Unreasonable Institute” where I found One Earth Designs and Cal Sol Agua. That intrigued me. In the manner of synchronous events, I saw a tweet from Neil Gaiman that day about a project on the crowdfunded art site Kickstarter. Which is how I started down the path of the changing (and growing) power of the crowd for this month’s column.
Neil’s tweet started me down the path, but then I fell off the cliff. Now I’m into two separate Kickstarter projects as a backer. I’m researching two more. For both of the projects that I supported, I will receive a beautiful illustrated book (for far more than the cover price) and the opportunity to feel like I helped the artist out. Although they were not fully funded at the time I gave them money, both are now fully funded. One of them has been sending me lovely project updates which remind me how beautiful the work is and how I am happy to be a small supporter.
Engaging stuff. One can support a human being you’ve never met and help them meet their goals – for as little as $5.00. It’s also possible to get in early on a new product. It’s a way to be one of the first people to know about something cool. It’s a way for those of us who have a little extra but are nowhere near capable of being Angel or VC investors to play.
Kickstarter is about the arts – musicians can find the money for a first recording, artists for a show, etc. The Unreasonable Institute has prospective students compete for spots in a business school designed to jump-start entrepreneurs. They have to post their ideas and get funding in order to even get into the class. A similar site, Rockethub, has a right-side activity bar where you can watch people join, fund projects, start projects, etc. It all happens rather fast.
The biggest success I came across in my research for this column is Scott William’s TikTok+LunaTik multi-touch watch kit (yep, really!) which essentially creates ipod touch based wrist watches . Scott raised over $940,000 dollars via Kickstart. That’s right; nearly a million dollars in crowdfunding. The average donation is about $70 each, which yields a copy of the product if the project actually gets off the ground. It means those of us who were too slow on the uptake won’t get any of the first ten thousand or so TikTok’s or LunaTik’s. Pretty nifty.
Members of the science fiction community have been playing with crowdfunding for a few years even though we haven’t called it that. For example, the “donate” buttons on startup magazines and podcasts have helped to fuel the success of Starship Sofa and Clarkesworld and other online and new media sf ventures. I suspect the donation buttons haven’t been enough, and that behind all of those (and for that matter, behind Futurismic) there are people who work for free or put in from their own pocket to keep a good thing going. But the fundraiser model has eclipsed the subscription model for magazines, whether it’s done in one big drive a year like at Strange Horizons or bit by bit like over at Clarkesworld. Oh – and if the written world isn’t your style, you can add your bit to fund the movie Iron Sky.
There’s also a lending side of crowdfunding. I suspect most people have heard of Kiva by now: a way to lend small amounts of money to entrepreneurs who are generally in third world countries. Kiva loans have become so popular that well over ten million dollars has been loaned through Kiva to date. When I went to see if I could join up, the statement on the web page said that “every loan is currently funded.” Anyone out there think that every loan request at any traditional bank is funded? I mean, wow. How cool is that?
So crowds are funding art, startups, and micro-loans. All of this is pretty much just for fun, and to make the world a better place. In general, there is little to no equity acquired by the backers. The only requirement for project success seems to be convincing people that the project is worth doing.
Funding is global. Crowdfunding is fast (most projects are only looking for funding for a few months at a time before the projects close). It is a competitive ecosystem (not all projects are funded). It also appears to be inherently liberal – help raise any boat and you raise them all.
As far as I can tell, the crowd is pretty smart, too. Interesting things get funded. This is a lot like Wikipedia, which really shouldn’t work but actually – largely – does work.
And because the science fiction writer in me simply can’t resist it, I have to mention that crowds are also driving revolutions lately. That’s a whole different blog topic, and it’s being written about all over the world, so I didn’t choose it. But there is a nexus here.
- The Crowdfunding Revolution Blog
- LunaTik Watch
- February 27th Blog at parliamentplc.com “Companies are Using Crowd Funding Now.”
Brenda Cooper’s latest science fiction novel, Wings of Creation, is out now from Tor Books. For more information, see her website!