Crowd-funding: A remote opportunity for the Arts

INCREASING THE FLOW OF CAPITAL FOR GOOD - INVESTING AND GIVING

Moving Crowds 10 by John Keane. Credit: see end of article
Magazine article

‘Harnessing technology’ is a phrase that pops up wherever there is a need to find new ways to raise funds – including in the DCMS Action Plan.

Many of our commentators also highlight the role technology might play in boosting philanthropic donations. But what does ‘harnessing technology’ mean?

Perhaps one of the biggest brains in technology-driven philanthropy is Lucy Bernholz who makes clear in her seminal paper Disrupting Philanthropy, the opportunity technology offers is not just about the access it allows, or about the data it captures and uses, but “the expectations and behaviours they unleash.”

Take crowd-funding. We first saw this concept, which allows many individual donors to give small sums directly to beneficiaries online, employed in reducing poverty in developing countries through sites such as Kiva, that connects individual lenders with third world entrepreneurs.

And with measurable success. To date more than 550,000 people across 292 countries have directly loaned more than $190,000,000 to third world entrepreneurs, representing an average loan of $382 per donor.

The concept, as Bernholz predicted, is now being borrowed in all kinds of areas where funding is an issue, including the arts. WeFund, Sponsume, BuzzBank, IndieGoGo and Pozible are but a few that the UK can now access, as Patrick Hussey of Arts&Business, writes in his feature 'The future of arts philanthropy?’  It’s a behaviour that begun in the US with Kickstarter, and offers donors the opportunity to become involved in cultural projects for a few dollars, often with additional perks.

Already, the UK can boast a successful crowd-funding initiative: Wefund’s ‘White Review’, a journalistic project that has attracted in excess of the £2000 it sought to launch a new non-profit arts, culture and politics quarterly, published in print and online.

However, while the innovative crowd-funding concept offers an exciting ideal, there is sceptism around whether it will be the answer to the funding gap facing most arts organisations in austerity Britain.

David Dixon, a fundraising specialist within the cultural sector, whose company NFP Voices supports cultural organisations in using social media, warns that for established arts organisations who already know their audiences crowd-funding is a ‘red herring’.

“Crowd-funding provides a way for donors to connect directly with artists and projects cutting out the intermediary and there is certainly a place for that.

In the cultural sector, it may well appeal to donors interested in discovering new artists and projects, allowing them to connect directly with the ‘artist starving in his garret’. But for established institutions it is entirely irrelevant.

They already know their audiences and have relationships with them. They know who their ticket buyers are so can communicate their new projects to them via post, telephone and email. Crowd-funding is unlikely to add a meaningful dimension in such established relationships.”

Having said that, Dixon says technology is important and incredibly valuable in fundraising for the arts. “Databases, email, websites and social media are crucial for institutions in strengthening relations with their audiences, building communities, interacting with them and providing a channel for donations.

But what should be remembered is that technology is a tool like any other and the important element in all donor communication, online and off, is the message it contains and the relationship it can facilitate, as it always has been.

Even for organisations that construct their organisations around this new phenomenon, such as Cinema Reloaded, a Rotterdam-based project that allows young film makers to upload their projects to a site in a bid to attract funding, and donors to become ‘co-producers’ for as little as 5 euros, crowd-funding has not been a roaring success.

Their two 15,000 Euro projects have failed as yet to meet their targets. The site is currently undergoing a relaunch with Dixon offering guidance. He explains: “Where it has failed is in attracting donors to the site through conventional means.”

It illustrates what many believe - that technology is just another tool and not the solution to attracting major funds. 

That said there remains great hope for technology as a revenue-generation channel for the arts and it is receiving serious government backing in the shape of a £1m seed fund announced by culture minister Ed Vaizey, at the Culture Change conference in London on 27th January.

Vaizey set out a clear expectation for cultural organisations to join the arts industry in making more use of technology to engage with audiences, attract new customers and, crucially, to boost revenues.

He announced that the Arts Council and NESTA will draw up proposals for a scheme to support museums, art galleries and other cultural organisations for smaller projects that will share their digital learning, backed by the £1m seed funding.

The scheme is intended to be available across cultural and creative industries, whether they receive government funding or not, to help organisations become more businesslike, and offer practical help with the nitty gritty of business, such as introducing digital innovations.

In his speech Vaizey highlights examples of a number of innovations that bring new audiences and enhance the visitor experience.  

While potentially exciting, it is important to remember these ideas are not suitable for every organisation and traditional tried and tested techniques for some will be far more successful than others.

Author of Cultural Giving and our guest editor Theresa Lloyd says: “Success in all cases will depend partly on the art form and the excellence with which it is presented, but also on the commitment of the board and those delivering the mission to real engagement with current audiences and visitors, and to creative thinking about audience development.”  

Lloyd says in successful fundraising for the arts, whether online or off, there are two crucial and perhaps obvious points that bear repeating: 

  • The quality of the artistic vision, mission and delivery must be outstanding. This is the most important factor.
  • People do not support “the arts” in general. People will not support the arts unless they are already inspired by the art form and feel they have a special relationship with the institution. That is why the best source of potential donors are visitors, audience members and other “users”.  

A promising example of non-digital innovation around ways to connect with new audiences is demonstrated by the Orchestra of the Age of Enlightenment. With significant funding provided by the Esmée Fairbairn Foundation (whose Director Dawn Austwick is a contributor to our commentary) the orchestra is developing a whole new approach – shorter concerts in venues far removed from a traditional concert hall, such as the Roundhouse. Informal, low cost, but with the same musicians playing to the highest standards with the same repertory as the “mainstream” concerts, the “Nightshift” concerts attract full houses of young people who love the idea that they can come and go, bring drinks in and are surrounded by other young people.

As well as being innovative with ideas for attracting younger audiences to live performances, the orchestra is pioneering use of digital technology. Its concerts from the Queen Elizabeth Hall, London (8th February), and The Anvil, Basingstoke (12th February) were available to watch through a live stream on their website. The transmission on 8th February attracted over 11,700 views.

The greatest hope for digital technology is the way it connects with younger audiences, but as Lloyd points out, it will be many years before these young audience members, and those attracted to crowd-funding sites who are not already involved with an organisation, will have the capacity to become major funders.

To reach these audience members is a challenge in itself, as venues that host touring performing companies hide behind the data protection act to deny access to the names of those who have bought tickets for a specific event, and institutions with free entry cannot capture the names of those who visit, however regularly, unless they also buy tickets for special exhibitions or, of course, become ‘Friends’,” says Lloyd.

So while “harnessing technology” is an important activity for the future, it, like so much of the Action Plan, is not a ‘quick fix’, nor will it be the ‘perfect solution’ – as Hussey points out: “With so many crowd –funding sites about there is a danger of splintering audiences and thus donors.”

And such funding could come with undesirable consequences – “it could change the way art gets made, making creation populist,” says Hussey.

Instead of pushing out what you think people want, the crowd-funded arts will have to be what people want. This could be hugely exciting. A chance to hitch the arts to topical interests and movements? It really could herald an era of co-created political art, harnessing the hearts and minds of demographics currently lost to culture. Equally, we could end up with ‘the Hoff does Hamlet’.

Crowd-funding could be the tool to democratise philanthropy, but it will also import inequality. Large, world famous organisations already prosper hugely on social media while small galleries struggle to accrue followers,” writes Hussey.

So while “harnessing technology” is an important ambition for the future of philanthropy, the most important word is perhaps not ‘technology’, but how it might be ‘harnessed’ in each arena.

Picture credit: Moving Crowds 10, 1999 (oil and collage on canvas) by Keane, John (b.1954) Private Collection/
© Angela Flowers Gallery, London, UK/
The Bridgeman Art Library.
Courtesy John Keane/Flowers Gallery, London.