Crowdfunding should move beyond simple pools of money.
Bring the supporters into the projects and let people do some work.
Below: A mock-up project showing new features for crowdfunding. Notice the added Materials and Labor sections, where supporters can sign up to send material contributions and commit to work roles.
This website presents an extended model for all-or-nothing crowdfunding. It was put together by a founder of the first all-or-nothing crowdfunding website, which paved the road for Kickstarter and IndieGoGo. Called Fundable.com (2005-2009), it served as an exhibition of crowdfunding’s archetypal projects. In 2006, Fundable’s online presence led to coinage of the word crowdfunding. Kickstarter launched in 2009, relying on Fundable as a reference when pitching investors.
Here, Noctivagous’ founder explains how providing physical, rather than just financial, opportunities for backers will expand the power of this online activity. In the future, backers should be able to sign up for work positions, ranging from heavy to light, according to the needs of the project organizer. They should also be able to supply vital and supplementary physical resources, and receive compensation.
Today, only money is the focus of crowdfunding projects.
On all-or-nothing crowdfunding websites, your participation in a project is currently restricted to the money you decide to pledge. You can pledge money— this is all that you or anyone else is allowed to do. You can play no other role, as an observing backer.
After your pledge has been received, you must wait for the project organizer to make use of the project’s pot of money. This always takes place in a process separate from you, although you will usually receive some news updates on the progress of the project. When all work has been completed, the project organizer issues a final report, often mailing you a product. This means that your role in crowdfunding is extremely limited— your value to a project never exists apart from your wallet and your role as a supporter stops at the moment you finish entering your credit card information.
But you, along with many other people, frequently have more to offer a project organizer than just money. There are many backers who can offer indispensable help during the execution of a project, or they can end up as recruited, part-time assistants. As a backer, you may wish to be involved in a deeper way in a project that you especially like, if the project organizer is interested. Right now there are no online mechanisms for that type of interaction to occur, on any major crowdfunding website. This is an important point, that all-or-nothing crowdfunding has developed along a narrow path, merely collecting money and unloading the capital on the project organizer, who must sort out every aspect of fulfillment independent of supporters, who could often help it succeed. It reflects the small aspirations of today’s crowdfunding websites that collecting/pledging money is the only permitted dynamic. The Internet embodies an expansive capacity for facilitating cooperative endeavors, much more than just simple collections of funds.
In many instances, a project organizer needs something essential and non-monetary that an outsider can provide, on terms that are more efficient than capital. Quite often, the audience of supporters has the potential to carry out important tasks and procure basic material resources, but this is never recognized and then accommodated in all-or-nothing crowdfunding. Any communications involving offers of assitance, between supporter and project organizer, currently take place outside of the project page, and only on the occasion that a supporter takes the initiative.
Below: A mock VR software application project. In this example, recruitment of long-term programming help and other forms of outside support allows this endeavor to exist somewhere between community software project and casual startup.
When backers become involved in a crowdfunding project in a deeper way, they will likely serve crucial roles in its success.
As it stands, right now you do play a role in the execution of a project when you pledge money; instead of that person pitching his product to an investor or corporation, he can place it in front of the Internet public, in a video, and the funding of the product will occur based on your pledge and that of others. In some cases, the product being sold would rarely appeal to any mainstream investor, only crowdfunding backers, and so it is even more the case that your pledge makes the product happen. But procurement of capital is only the initial business concern that a project organizer faces when executing a crowdfunding project. For crowdfunding websites, it should be considered the most basic layer of support from an audience of well-wishers and strangers.
If you, as a backer, especially like a particular project, wouldn’t it be nice if you had the option to help out the people behind it in the process of their design, testing, and fulfillment stages? For some people, the answer is no, but for others the answer is a definite yes because getting to be part of a project’s success is already a major reason they pledge money in crowdfunding in the first place. Such roles can vary in purpose, from minor to major. Helping a project occur is what provides many crowdfunding participants an entertaining experience because they know that without their pledge the project could not otherwise secure support, especially from typical investors. Although sometimes forgotten, this is what elicited early enthusiasm for Kickstarter and IndieGoGo. Crowdfunding subsequently grew and managed to root itself in society because it provided the Internet public a long-desired, engaging digital space in which online activity could translate into real-world objects and events. It gained international interest because it was more than just the digitization of an existing everyday activity, like ordering a pizza, taking out a classified ad, or buying a product in a store. Rather, for the first time, the Internet had been used to enable projects that would have previously faced serious resistance in the real world.
Crowdfunding already makes the Internet better.
A central, appealing feature of all-or-nothing crowdfunding is that it provides online forums for a single individual to feel influential in projects that truly exist. This takes online life beyond the typical mundanity served across the rest of the Internet, such as stuffy news stories describing events hundreds of miles away, which hardly impact any given individual who reads them. News organizations treat the Internet as a world-wide loudspeaker, made for them to read their news out loud, but the most prominent benefit of the Internet is that any digital activity mediated by it can gather people together who live far apart geographically, and it can coordinate their participation and resources in an efficient manner. There is little public participation involved in consumption of news information.
Most people say that all-or-nothing crowdfunding has made the Internet a more interesting place. But for social media, online interactivity mostly relates to the trivial, topical, and mundane. It does at least relate to the real world, unlike the interactivity found in online video games, which cannot extend beyond fantasy. But an enticing aspect of video game engagement is that participation is deep-- much deeper than today’s all-or-nothing crowdfunding, it is just that it is meaningless after the computer has been turned off. With the augmentations described here, all-or-nothing crowdfunding could easily match the level of engagement and participation found in video games, but produce social activity that actually matters and impacts life in the real world. What it requires is adding another layer of participation to crowdfunding websites.
Despite plenty of moral support already existing in a typical audience of backers, if the project organizer ever wanted material or physical help from them and could benefit greatly from their expertise, there is currently no way for him or her to accept such assistance on today’s crowdfunding websites. There also isn’t much integration with online chat tools to keep supporters abreast of developments in real-time. If this situation is changed, crowdfunding will take on a new form and potentially remove a multitude of time-wasting youth from the video games they play all day, redirecting their energy towards valuable efforts. Crowdfunding websites have a lot of work to do: even though someone from an audience of supporters might actually be able to fulfill a crucial need that eliminates major financial costs or obstacles in the project’s execution, it is only money that is allowed right now on a crowdfunding page. Doing more will require testing and some practical research so that what public considers “crowdfunding” is designed to affect projects all the way through the fulfillment of their orders, not just their solicitation of monetary pledges. It would be better if crowdfunding assumed a more interactive form, similar to multi-player video games (minus the fantasy and game-playing). Crowdfunding websites need to become cognizant of what the “crowd” can offer a project organizer apart from money and, in many cases, allow them to stick around through every phase of a project’s execution.
Everyone knows that there are resources the project organizer needs to acquire that can be procured directly from backers because everyone has felt at a certain moment in his life, “I wish someone who has the object I need sitting in his backyard somewhere could just deliver it to my house instead of me having to go out and buy it brand-new for no reason.” In some cases, backers can provide resources that eliminate the need to sign contracts for costly labor and rentals, which will allow for automatically lowering the minimum collection total correspondingly while the project is playing out. It is certainly true that interested professionals and experts can provide low-cost rates for projects they admire. When costs are reduced and collection totals are lowered, more projects can succeed. An interpersonal element is also added: someone who has provided expertise because of his interest in the project is usually more valuable to its success than a professional who was sought out in a typical commercial context, with no personal investment in its outcome. Any supporter may be able to play the role of a useful associate for the project organizer for the duration of the project’s execution, making sure that pitfalls are avoided. Interestingly, For some projects in the future, not even a single transaction of money may need to occur the entire time if enough experts and helpers come on board.
Coming back to how it is today, if you would like to have a bigger role in a certain project in today’s crowdfunding, at the current time your only option is to pledge a larger-than-average amount of money. Then, you may receive a special reward, a public acknowledgement, or a better deal on the product being produced. This is far from permitting you to lend a hand in the execution of a product or even allowing you to design some particular feature, as an experienced outsider. If you are a graphic designer, why can’t you design the website for a certain all-or-nothing crowdfunding project in exchange for its final product, if doing so would eliminate an obstacle? If you are a film editor, why can’t you sign up to edit film footage shot by an interested director or cinematographer, and even get paid from the collected money? If you are a sound engineer or music producer, shouldn’t you be able to sign up for the production of a person’s album, possibly for a certain amount of profit? Aren’t there many such roles in a lot of projects that go unrealized, when there were actually plenty of ready participants that were present within the “crowd” in crowdfunding? In truth, filmmakers and entrepreneurs already shape their wares, products and media production around the requirements of today’s all-or-nothing crowdfunding. When more features are added, this activity will carry greater potential for them to succeed in an comprehensive way.
In the new model of crowdfunding, you will have real-world opportunities to participate in the execution stage of a project and get something in return, should the project organizer find you to be of use. In some cases, you may not need to pledge money to a crowdfunding project to participate in it— your online work (or in-person work if you are in the same region as the project organizer) may be considered even more desireable by the project organizer than your money. There are many such qualifying logistical requirements that project organizers face, all the time. You could, as a bystander, who signed up to act as a backup helper, be the person who prevents a project from stalling or not fulfilling orders. If it is a local project in your area, you could send unused material resources that you happen to own, or offer your own time and labor to help something important occur in the project’s execution. Community projects can prosper with added, physical, community help. The addition of corresponding interactive components on crowdfunding project pages can make crowdfunding more meaningful, worldwide, enabling the Web to do more than just accumulate piles of money for people, who then spend all of their time trying to make the best use of it. As a final example, family members or friends who are short on money can offer something other than what is in their bank account; they may have some asset just as useful for a person, or they can show up in the real world to take care of some project tasks.
New functionality for all-or-nothing crowdfunding is divided into two categories: solicitation of labor and solicitation of material needs.
Since we have established that there are ways to participate in crowdfunding apart from just pledging money, it makes sense to add two new progress bars to a crowdfunding page that represent the two most common forms of real-world contributions, currently unimplemented for crowdfunding backers. The first additional progress bar provides a backer the opportunity to physically mail or deliver (in person) material items to the project organizer that he will no longer need to buy if someone sends it; a person may have something on hand that the organizer needs and he can get compensated with the end-product by mailing or delivering that required resource. Then, this item (listed just beneath the material resources progress bar to which it belongs) is checked off and his contribution makes the progress bar advance. In addition to physical objects, the project organizer can also request non-physical resources, such as website server space. A person who can provide a resource like that can eliminate the need for the organizer to research various sources before buying it; having a personal contact is an asset. Rental contracts do not need to be sought out and signed when a supporter has committed to providing the rental underneath the material resources progress bar, directly. For those who have organized projects before, they already know that this kind of help can be an immense time-saver.
The second additional progress bar provides the backer the opportunity to sign up for work positions. A person may play the role of an advisor, a manual laborer (if the project is to unfold in the real world), a designer, a composer, or a programmer. If the project is software, this progress bar could recruit as many as a dozen programmers to work on a piece of free software. Concurrently, the project page can collect funds for needed technical resources the programmers will use. If the crowdfunding project exists to make a short film production take place in your area, you and other backers can sign up to act as help on the film set on a free weekend, while others who are not able to help on the film set can commit to providing free access to their film equipment. Experienced filmmakers in the area can also sign up make someone’s film much better by signing up for an executive producer position. There are a myriad of situations in which outside labor and help can play essential roles, on a large number of projects.
These two additional progress bars are meant to enhance the dynamic of crowdfunding by bringing out deeper participation from the “crowd.” Previously-unseen types of projects will emerge and be available for the public to browse on crowdfunding websites because a broader dimension of participation has been implemented. These new types of projects will manifest varying ratios of outside help to internal personnel making them possible, with some projects asking for only a few outside workers or material items. The two additional progress bars, material and labor, also permit the formation of crowdfunding projects that arise entirely because of what the new functionality enables— large, established groups can now coordinate complex participation from their already-existing membership, with material resource and labor commitments, and thereby take advantage of the Internet’s capacity to organize communications and achieve group consensus, across a small or large geographic area.
Project organizers will vary in their desire to integrate backers’ participation in the execution of a project.
The goals that people have in crowdfunding vary greatly. Accordingly, in the new model of crowdfunding, there are different degrees of participation from a target audience that a project organizer might elect. Some project organizers might want outside help to be central to their project’s success while others might only ask for some medium-sized material and labor contributions from supporters. There is a wide range of configurations that a project organizer can choose from when integrating backers within a crowdfunding project. Below are example descriptions of light to deep scenarios in which outside supporters are integrated into the project. It is important to note that “outside supporters” may not always be new faces, but can be known individuals or persons from a local community.
Light Backer Participation - In this scenario, a project organizer is benefiting from the two new progress bars but uses them supplementarily. Backers provide supplementary support with their material and labor resources, but are not crucial. Most of the project’s resources can be acquired without backers, using the collected money, and nothing of the project will fail without the backers committing to labor or material contributions. Backers may be present intermittently during the project’s execution or be on hand in the case there is need for backup assistance. Ownership is unambiguously in the hands of the project organizer.
Medium Backer Participation - In this scenario, backers provide critical support at certain times, but are not active during all of the project’s execution. Direction and ownership of the project is still strongly in the hands of the project organizer.
Deep Backer Participation - Backers and project organizer work closely together for the duration of the project’s execution. Coordination of all tasks and essential matters is handled by project organizer. Ownership is felt by all to be in the hands of the project organizer, ultimately, but influence by backers can be strong.
This type of project is approximately 80% dependent on crowd participation. The initial design of the project and its purpose is set up by the project organizer, who can tap various community participants to complete it.
Comprehensive Backer Participation - backers and an elected project organizer work closely together. Ownership is felt by all to be in the hands of the backers and organizer together, but the project organizer plays the role of primary coordinator and public servant.
This type of project will likely arise from an already-existing community and can serve to realize a long-term goal that the community or organization has had for a long time. In this case, the project organizer acts as coordinator and is not receiving the money and resources for personal or company profit purposes, but instead for the whole of the community’s effort or its organization. An example:
The central limitation of today’s crowdfunding, that money is the sole form of accepted contribution, has led to two negative situations. First, people who have essential resources on hand that they can contribute have been overlooked in favor of supporters who want to pledge money. Second, the types of projects that crowdfunding websites can accommodate is artificially restricted to those that will be able to exist just by spending capital. Furthermore, the crowdfunding projects that become quite complex during their execution and order fulfillment don’t always stall because they collected too little capital, but rather they had too little outside help. As illustrated in the mock-up crowdfunding projects provided, a new form of crowdfunding can recognize that real-world projects often draw from a variety of material and personnel resources, not just money. It is the Internet that has molded crowdfunding to collections of money, not crowdfunding reflecting what people do in the real world naturally. This is evident because many projects today already use the help of third-party engineering, design, or manufacturing companies, acquired in advance of the project’s execution. It makes sense that not all projects need to hire professional firms and could ask for public help instead. In some cases where orders went unfulfilled, had supporters gotten directly involved, the projects may have been able to avert backer disappointment. It is time to recognize alternative forms of participation in crowdfunding that can help even more projects succeed. Doing so will surely impact the first days of their collections in a postive way, and carry through their project all the way to fulfillment of orders and/or event goals.
Last updated on 10-5-19.
2019, NOCTIVAGOUS, INC.