Crowdfunding in practice

Crowdfunding is not easy. “It’s a lot of work and arts organisations tend to underestimate that,” says Oonagh Murphy, who ran a crowdfunding project for Arts and Business Northern Ireland that looked at how smaller organisations could use this form of fundraising. 

“The work you have to put in after you’ve launched a campaign is particularly challenging, and you need someone on it all the time if you want your campaign to be successful. This can be difficult for smaller organisations.”

Because it’s easy to get disheartened, she also recommends nominating a cheerleader to keep everyone motivated and on track. Cross-departmental teams can also ensure that a wide range of staff are on board with the campaign, and are able to contribute a range of expertise and experiences.

“Our research also found that knowledge of digital culture and being able to deliver digital content is really important,” Murphy says. “Organisations need to be structurally light enough to be able to post content on social media without going through layers of administration or permission.”

There were about 20 applications for the Arts and Business Northern Ireland project, and the four projects that were picked all had one thing in common. “They had looked at their audience base and already knew who would back them,” Murphy says. “If you don’t know this, then crowdfunding isn’t right for you.”

She recommends that museums back-load campaigns, so there is already money committed before a public launch: “One statistic I’ve seen is that the most successful campaigns will have 20% in the first 24 hours.”

Crowdfunding is time consuming, so a campaign should only be run in a period when staff are able to dedicate considerable time and resources to it.

Equally, choose the time of year carefully. The Bowes Museum in County Durham used Kickstarter to run a crowdfunding campaign to fund a Gavin Turk installation from December 2013 to January 2014.

“The timing over Christmas meant a lot of people were away, although we saw momentum pick up in January and we hit our £6,000 target in the last week,” says Alison Nicholson, the Bowes Museum’s digital communications and fundraising officer.

In contrast, Birmingham Museums Trust actively promoted its Spitfire Gallery crowdfunding project as a Christmas gift.

There are a vast number of crowdfunding platforms, but the best known are probably Kickstarter, GoFundMe and Indiegogo.

Many museums think they can’t use Kickstarter to crowdfund because it does not allow “charities projects”. Actually, this just means that the platform can’t be used by people who want to raise money for a charity – but projects run by charities are eligible.

The four organisations that took part in Arts and Business Northern Ireland’s project all used Indiegogo, largely because this platform gives the money to organisations even if they don’t hit target, allowing them to scale down projects if needed.

But Murphy says that an “all or nothing” platform might provide organisations with additional drive to succeed.  

The Bowes Museum’s experience of using Kickstarter to raise money for the Turk installation was largely positive. The artist had previously run his own Kickstarter campaign, so he had followers on the site.

Nicholson says that the site enabled the museum to reach a new tranche of supporters, “which was really important as contemporary art is new for us and we wanted to raise our profile”.

Birmingham Museums Trust used JustGiving to crowdfund for its new Spitfire Gallery, partly because this platform was already familiar to the museum.

“It shows how much money has been raised, which is really good for keeping people informed, and it also allows us to add offline donations,” says Rachel Cockett, Birmingham’s director of development.  

For this project – where £3,455 was raised offline compared with £725 online – this was vital.

When considering crowdfunding platforms, museums should look at the terms and conditions carefully, and check what fees they will be charged.

Last year the Art Fund launched the first museum-specific crowdfunding platform, Art Happens. Unlike other websites, it doesn’t charge fees and it allows the museums to collect Gift Aid. It also promotes the projects to its membership base and provides funding to cover the cost of rewards – but participation is on an invite-only basis.

“The project has to come first,” says Cockett. “I wouldn’t want to force a project into crowdfunding, it has to be appropriate.”

The right project for crowdfunding has to have appeal for a wide range of people, or at least an identifiable audience.

“There has to be value for the giver,” Oonagh Murphy says. For that reason, she doesn’t believe crowdfunding for “everyday” work such as running a community project or keeping a museum’s doors open would be attractive to people. “These are things that people think the government should fund.”

Quirky projects tend to work best, as they are more likely to capture people’s imaginations and generate publicity.

“Donors also like to know why an organisation is running a campaign,” says Hannah Bishop, the fundraising and membership assistant at the Horniman Museum and Gardens in London, which successfully raised £9,500 to stage an exhibition of Mark Fairnington's paintings alongside its taxidermy collection on Art Happens.

Bishop says its campaign was perfectly suited to crowdfunding because Fairnington’s works were inspired by the museum’s taxidermy.

Although crowdfunding campaigns to acquire an object or artwork are less common, the Art Fund’s Young doesn’t think museums should rule it out. The test of a good crowdfunding project, she says, is whether you can articulate it in a visual and exciting way so people “get it” in under a minute.

Most museums use crowdfunding to raise 100% of the money for a distinct project, but there are exceptions. For example, Birmingham Museums Trust used crowdfunding for its Spitfire Gallery alongside a more traditional mix of public funds, trusts and sponsorship.

The Art Fund’s Young says it is open minded about this approach: “At first we thought it was best to have a distinct project that is only funded through crowdfunding, to give people a sense of ownership.

"But increasingly our thinking is that crowdfunding could be good way of leveraging funding, especially as the more public get involved, the more traditional funders want to give their support.”

Understanding who the audience are is an important part of developing a crowdfunding project. More than half of people who give to projects on Art Happens are new to the Art Fund. The remainder are members.

“The profile of donors depends on the project – as you might expect, people who gave to Norwich Castle to re-gild a frame of the Paston Treasure were different to those who supported the Chapman Brothers exhibition at the Jerwood Gallery in Hastings,” Young says.

There are no hard and fast rules for the right amount of time a crowdfunding campaign should run for, but some statistics suggest the average campaigns lasts between 40 and 60 days.

Crowdfunding campaigns can be very intensive for the staff involved, so the timeframe should be realistic and take into consideration whether there are adequate resources available to communicate the campaign day in, day out, for the entire period.

The Bowes Museum decided to opt with a shorter length (40 days) for its Art Happens campaign, compared to 60 days for its Kickstarter project, because it knew that staff wouldn't have the time to keep going for longer than that.

Maintaining momentum is important, but this does have to be balanced against ensuring audiences have sufficient time to engage with the campaign's message.

The fundraising target is also key. Clearly this will be determined by the project but the platform may also have an influence. If the platform pays out even if the campaign doesn't hit its target, can the project be scaled down?

Some platforms, such as Art Happens, allow projects to increase or decrease the target during the campaign.

Arts and Business Northern Ireland’s crowdfunding toolkit recommends that the cost of platform fees and rewards (including postage and packaging) should be factored into the fundraising target.

Lisa Westcott Wilkins, the managing director of the archaeology crowdfunding platform DigVentures, advises anyone looking at crowdfunding to be realistic about their financial goal.

“I think people are often too optimistic about the potential to raise the amount money they want to," she says. "Set a target, and drop it.”

Rewards are what make crowdfunding projects different to other types of individual fundraising.

Each reward should be pegged at a donation level – in most cases, this will start with a small gift for a £5 donation, with better rewards offered for higher levels of giving.  

Alison Nicholson from the Bowes Museums says that £20 is the average crowdfunding donation, so museums should try to put something attractive at this level.

Because campaigns are linked to a tangible project, the rewards system helps to increase the average gift rather than being a reason to give in the first place, Young says.

She recommends that museums offer exclusive or limited-edition rewards, to add additional value to donors. But the value of gift should not mirror the size of the donation – museums must remember the cost of offering rewards, as well as postage and packaging.

Remember that, on average, 25% of Kickstarter donors and 30% of Art Happens donors select no reward. “This shows that they really donate to be part of something,” says Nicholson.

The Art Fund sets the reward levels for campaigns on Art Happens, and also provides funding for organisations to develop exclusive products or experiences to offer donors.

The Horniman worked with Fairnington to find out what he was interested in and what his most popular works were. Although it’s important to offer rewards that have appeal at all levels, the Horniman tried to find some items that would “tempt” people into the higher giving levels.

For example, a tote bag featuring Fairnington's iconic zebra design pegged at the £25 level has proved to be the most popular reward, drawing people up from the £15 postcards.

“We were going to offer experiences as rewards but the Art Fund advised us that these can be less popular because people might not know if they can make a specific date in the future and it limits donations from people or are able or willing to travel to us,” says Bishop.

However, the Bowes Museum’s crowdfunding campaign on Art Happens to raise £21,000 to redisplay and conserve our 15th-century Flemish altarpiece, offered a number of experience-based rewards that proved popular with donors.

And Birmingham Museums Trust found that its reward of a preview of the Spitfire Gallery was very well attended and fairly cheap to run.

Although planning the right project is time-consuming, the real work begins once the campaign has launched.

"It’s not a case of build it and they will come,” says Young. “What you put in you get back.”

Part of this is ensuring you have the right message. When it comes to communicating your campaign, DigVentures' Westcott Wilkins says “it’s not about you – it’s about the crowd”.

This means identifying what’s in it for them and finding ways they can engage on an emotional level.  

Because digital fundraising is about having a two-way conversation with audiences, a “broadcasting” approach to communications may be less than successful.

“There is no magic formula for developing the right message,” Westcott Wilkins says. “The successful ones are campaign or cause specific and are relevant, linking back into what the organisation is trying to achieve.

"If you have a compelling story, then tell it in different places (offline as well as online) and think about what your potential audiences need to know. The campaigns that sink without a trace are too traditional and conservative.”

Young recommends that museums plan their campaigns around the project. “Reach out to organisations that may not have worked with before. For example, the Jerwood Gallery got a big boost from White Cube when it was crowdfunding for its Chapman Brothers exhibition.”

Likewise, the Bowes Museum asked Turk’s studio to share the Kickstarter campaign with its networks.

Art Happens uses short videos to pitch campaigns to the project. Ideally, Young says videos should include staff, artists or audiences because “people buy into people”.

Social media was vital to the Horniman’s campaign, with virtual artist studio tours helping to keep the message fresh.

“We also sent emails to members, donors, and people who have previously attended our taxidermy events, as well as including it in our general e-newsletter,” Bishop says. “But there’s no easy way to track where donors have come from.”

The more people that know about a campaign, the more likely it is to receive donations, so the Horniman’s approach was to ask people to share it with their networks rather than necessarily give themselves.

“Asking can be all encompassing,” Bishop says. “You have to do it often and it is time consuming. But because a campaign only lasts for a short period of time, people don’t mind being contacted more than once.”

Campaigns might only last between 40 and 60 days, but it can be challenging to keep the message fresh.

The Bowes Museum’s Nicholson says that it is better to communicate campaigns via personal rather than group emails.

She also says it’s important to think outside the box, and look at who the project or the rewards might appeal to.

For example, Turk created an exclusive tote bag for the Kickstarter campaign in the same design as a Jackson's carrier bag, a well-known and iconic shop in Hull. Nicholson contacted Hull University as she knew the bag would appeal to its alumni.

Turk’s neon installation showed the world's population in numbers, and campaign was given a boost when it was picked up by the charity Population Matters, which heard about the artwork and shared the fundraising ask with its members.

“Don’t just try to tap into existing supporters,” Nicholson says.

Don’t expect the amount of money raised to mirror how far along a campaign is.

Although it’s important to get early donations in, most crowdfunding campaigns see the largest increase in giving during the final week.

For that reason, it can be a nerve-racking period for the staff involved in the project.

“It’s not a question of being 50% through at the halfway mark,” says the Horniman’s Bishop. “It’s easy to feel that the donations will come rolling in because you’re so excited about a project, and it can be disheartening when they don’t but it’s all part of the process.”