CROWD MODEL FOR SOCIAL CAUSE :CROWDFUNDING FOR VOLUNTEERISM
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1 CROWD MODEL FOR SOCIAL CAUSE :CROWDFUNDING FOR VOLUNTEERISM NATIONAL PREPAREDNESS MONTH YSS MDEC - JPAM 17 Oct 2015 Multimedia Development Corporation 1
2 CROWD PARTICIPATION FOR SOCIAL GOOD Crowd participation and contribution for social causes can be augmented with digital technology World Giving Index measures: 1. Monetary donations 2. Time allocated for social causes; and 3. Help offered to strangers 2
3 HOW DO MALAYSIAN RAISE FUND FOR SOCIAL CAUSES Traditional Way Crowd Perspective Fundraising Events Donation Boxes No Validation No Transparency Digital Way Social Media Facebook WhatsApp MSM Government-Initiated SMS Drive No Information on Target Amount Reached There are cases of fraudulent donation drive reported, leaving the big hearted skeptical 3
4 TAPPING THE POWER OF THE CROWD 4
5 IMPROVING MALAYSIA S REAL RANKING DM Objective: Facilitate community s contribution towards social cause, via ICT enabled platforms that support deployment of programs/activities In the pipeline. Social Crowdfunding Platform Trusted crowdfunding Platform Facilitate NGOs to raise funding Tax- Deductible Platform Greater Transparency on fund utilisation & impact 5
6 SOCIAL CROWDFUNDING 6
7 CROWDFUNDING MODELS CROWDFUNDING IS AN ONLINE DISTRIBUTED MODEL FOR CAPITAL FORMATION 5 basic crowdfunding models but hybrid are forming Donations: Crowdfunders donate money to campaign owners and do not expect to receive a tangible benefit from the transaction Rewards: Crowdfunders support campaign owners and receive some kind of reward in return for their contribution Equity: Crowdfunders invest in campaign owners and receive equity or equity-like shares in return for their investment Lending: Crowdfunders lend money to campaign owners and expect the future repayment of a principal with or without interest Royalty: Crowdfunders invest in campaign owners and receive a share of revenue earned in return for their investment 7
8 GLOBAL TREND: CROWDFUNDING NEARLY TRIPLED IN 2014 A disruptive shift as companies, NGOs & individuals raised USD16.2B in 2014 compared to USD6.1B in 2013, with approximately 20% for Social Causes Funding for Social Causes is the 2 nd highest after Business The volume funded for Social Causes worldwide rose 2.5 fold from USD1.22B in 2013 to USD3.05B in
9 THE QUICKEST IN GAINING POPULARITY HAS BEEN DONATION-BASED CROWDFUNDING Donation-based is the most active crowdfunding segments in 2012 Un-regulated Source: Crowdsourcing.org
10 CROWDFUNDING IS THE NEW TOOL OF SOCIAL SECTOR Prevalent examples of social project Combining traditional funding sources with crowdfunding Key Advantages of Crowdfunding Disaster relief / humanitarian Cases built by NGOs, Community 100% Crowdfunded Lower fund raising cost more fund goes to the intended cause Food for the poor Education Restoration of facilities / infra serving low income group Fighting Disease many more X% Crowd funded X% Crowd funded Y% CSR Y% Grant Projects validated by community Better transparency on fund utilisation Greater speed of delivery Crowdfunding in general and social crowdfunding is still in its early stage in Malaysia 10
11 CROWDFUNDING KICKSTARTING INITIATIVES SOCIAL CROWDFUNDING FOR MALAYSIAN IN NGO 11
12 GIVE.MY THE STRATEGY Building an ecosystem for crowdfunding by focusing on a community of donors based on their interest, firstly the education sector 12 Education Projects RM44k Donated in aprox 1 month Range RM10 RM2,500 1,500 Students Impacted Supported by Social Entrepreneur, Educationist, Internet Entrepreneur 12
13 SUPPORT A LIVE EDUCATION PROJECT : FUND A SOCIAL SCIENCE ROOM TO SPARK CHANGE 13
14 CROWDFUNDING INITIATIVES FOR MALAYSIAN NGO 14
15 CROWDFUNDING IS THE NEW TOOL OF SOCIAL SECTOR Prevalent examples of social project Combining traditional funding sources with crowdfunding Key Advantages of Crowdfunding Disaster relief / humanitarian Cases built by NGOs, Community 100% Crowdfunded Lower fund raising cost more fund goes to the intended cause Food for the poor Education Restoration of facilities / infra serving low income group Fighting Disease many more X% Crowd funded X% Crowd funded Y% CSR Y% Grant Projects validated by community Better transparency on fund utilisation Greater speed of delivery Crowdfunding in general and social crowdfunding is still in its early stage in Malaysia 15
16 COLLABORATIVE PROGRAM Building an ecosystem for Crowdfunding : NGOs, Corporations, Crowdfunding Platform, Government Agencies collaborate to build a community of donors In the pipeline. Social Crowdfunding Platform Trusted crowdfunding Platform Facilitate NGOs to raise funding Tax- Deductible Platform Greater Transparency on fund utilisation & impact Suggestions. Mobile Enabled SMS donation as a payment gateway Branding for Social Crowdfunding Platform / NGOs / Projects Policy on % of CSR funding to be channeled through crowdfunding 16
17 THE APPROACH : A PILOT PROGRAM Hand-holding session Invitation to NGO s on this program #1 Day Program Briefing for 7 hours (50 NGOs per session) Program (will be conducted in 2 session) Equal to 100 NGOs Awareness ½ Day PitchIN workshop ½ Day Adopt 10 from the list for crowdfunding 1 Tools for execution Give more training Crowdfunding Training The Modules Crowdfunding pitch Monitor progress FGD1 FGD2 FGD3 Develop guidelines to execute, Modules to fundraise including basic governance, communication plans and tools required 2 Facilitate the funding Hybrid = crowdfunding + corporate funding 3 Proof of work NGOs with good governance & branding Funding raised 17
18 BUILDING THE CROWDFUNDING ECOSYSTEM IN MALAYSIA CROWDFUNDING INITIATIVES FOR O MALAYSIAN NGO Crowdfunding Platform PitchIN.my, SimplyGiving.com, PeopleGiving.org, mystartr Project Initiator NGOs, Activists, Volunteers Donors & / Supporters : Individual & CSR Government : YSS, KPT, ROS, MDeC 18
19 MULTIMEDIA DEVELOPMENT CORPORATION 19
20 Crowd Funding 101
21 What is Crowd Funding? An alternative method of raising money for a business, project or idea. With crowd funding, an entrepreneur or a project owner can attract a crowd of people to contribute towards an online funding target.
22 Kickstarter: A Film Project (highest # of backers)
23 Kickstarter: Pebble Watch
24 Current World Record! Pebble Time USD20,338,986
25 The Biggest Project to be Funded on pitchin.. TAPAUFEST RM days RM pitchers Highest in MY and SEA. First ever festival to be crowdfunded in SEA and possibly Asia too
26 The Best Performing Social Community Project on pitchin USD days USD pitchers
27 Elements of a CAMPAIGN Page
28 ELEMENTS OF A CAMPAIGN PAGE $ Campaigns with PERSONAL VIDEO raise more than 105% MORE than those that don t Visitors are 22% MORE LIKELY to donate to campaigns that have RAISED 40% of their goal
29 ELEMENTS OF A CAMPAIGN PAGE SHARING TOOLS (conversion rate %) Deadlines create URGENCY and help increase % FUNDED
30 ELEMENTS OF A CAMPAIGN PAGE TELL YOUR STORY Campaigns with an average word count between WORDS raise the most money Explain WHO WHAT WHY Use pictures of people, children, pets and projects
31 ELEMENTS OF A CAMPAIGN PAGE REGULAR UPDATES Campaigns with regular updates raise 126% more than those with NO UPDATES Reward based funding GREW 524% 43% of crowdfunding campaigns offer rewards
32 Stage 1 Stage 2 What are the key criteria to be successful in crowd funding?
33 Possible Crowd Funding Timelines* Crowdfunding Timeline (Weeks) Information Gathering Preparation Apply to Funding Portal T * To Equity Or Not To Equity Alixie Cormick Identify & Work Your Network for Support Contact Media and Work Social Campaign Campaign Live on Funding Portal
34 Start Before Launch Get your community ready Build the excitement
35 Hit the ground running Some projects try to crowd fund far too soon, with little or no build up. People s opinion of any project will be based at least in part by how well it s been received by others, so if a lot of time has gone by with little or no money raised, then it will be seen as a vote of no confidence..
36 Prepare Your Crowd!
37 Do the legwork before you launch The crowd funding campaign should be your last push. Write a project blog, open Twitter and Facebook accounts and create teaser videos before your project goes LIVE. Do as much as you can to get your message out there and keep on updating people. Build momentum leading to it..
38 Enlist Your Army! Evangelists Your Interest Groups
39 Know your customer/investor Get covered. Getting mentioned on the right press can have a far bigger impact. Focus efforts to reach the people who are most likely to back your project.
40 Sell Your Project
41 Tell a compelling story Paint a picture of what it might be, document, tell a story. Let others know. Get people to know your project/business. Spend some time to do a high quality video.
42 Be Transparent Be open with budgets/plans Don t hide information
43 Be open, honest and realistic People will want to know a lot about you and your business. Unless you have a pre-existing reputation as a successful entrepreneur, you must expect people to want to know more about you and your story. It s important to remember that in many cases your backers will help out by providing their time or expertise let them know how they can help.
44 Set goals Set a meaningful and realistic funding goal, set it too high and you may never reach it set it too low and you won t create enough excitement or benefit that much once funded.
45 Communicate Regular Updates Reachable Respond
46 Be prepared to work hard Not a shortcut to success, nor an easy ride it takes hard work. It s not magic. Be prepared to keep promoting the project to all your contacts, on your social media accounts and in the media too.
47 Summary Crowd Funding is a viable option for entrepreneurs to raise funds, be it for a project or an idea that needs validation or a business that wishes to scale. A great source for validation with little risks. Success is not guaranteed but entrepreneurs will definitely learn.
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