Tapping into a cash crowd for project finance

In its first year in operation, crowd-sourcing site Fund It has helped numerous projects, from a Julie Feeney album to Enda Walsh’s ‘Misterman’, and a water-disinfection scheme in Kenya

IT’S A YEAR SINCE the Irish crowd-funding website Fund It was launched by Business To Arts, an Irish organisation that brokers creative partnerships between artists and arts organisations and businesses. Twelve months on, more than €500,000 in pledges from members of the public have funded creative projects. In a time of so-called austerity, why is Fund It so successful, and where does it go from here?

Looking back, Fund It was all about timing. “It wouldn’t have worked the same way the year before. It wouldn’t work the same way if we started today,” says Stuart McLaughlin, the chief executive of Business to Arts, who is sitting with Rowena Neville, its director of marketing and PR, at a cafe around the corner from their Temple Bar office.

“There was definitely a moment where people moved a little bit out of the phase of being caught in the headlights of the economic chaos and were starting to work out how they could do things a bit differently. Obviously not getting back to where we were and feeling flush, but people seemed to like to find a way to make things happen.”

The website allows people to submit creative projects for funding in exchange for rewards specific to the amount someone gives. A timeline is established and if the target isn’t reached, the money pledged isn’t debited from individuals. In the website’s first year, 11,683 pledges were made totalling €623,000.

Some €537,853 has been funded to successful projects, with €43,510 currently live on the site, and €51,083 never banked from unsuccessful projects. During its first year, 143 projects were successful. The average total amount pledged to a successful project is €3,761.21; the average individual pledge is €54.21.

McLaughlin and Neville talk about networks a lot. The original impetus for Fund It examined the fact that plenty of artists, theatre companies, bands and other creative enterprises had untapped networks of Facebook fans and supporters.

“At the very beginning there was the idea that people were working to develop these social networks but without having any real purpose behind that,” McLaughlin says, “Part of it was trying to realise the value of those networks.”

Neville goes one step further: “We were trying to create a change in behaviour of people in how they consume art and culture. So you might buy that theatre ticket and go and see it, but actually, would you buy it four months in advance knowing that you helped make the costumes?”

Performance projects are the most successful, followed by music, art, film and TV events, and media and publishing. Of the successful projects, 58 per cent are from Dublin, 11 per cent from Cork, 9 per cent from Galway and 3 per cent from Kilkenny.

Fund It is a product of recession. But its success also lies in the fact that Irish people happen to be very good at giving small amounts in large volumes. Neville says that during a project campaign, the money being raised can often become immaterial, because what the project creator or creators begin to realise is that they’ve tapped into and engaged a network.

Julie Feeney’s funding project for her third album is the most successful music project on the website so far, reaching €23,045. “It was a monstrous undertaking. I underestimated that side of it,” Feeney says. “You couldn’t really concentrate on anything else while you were doing it.”

At the time, Feeney was looking at funding platforms such as Kickstarter and musicians such as Amanda Palmer, who uses crowd-funding to great effect. “There is an interesting thing in an exchange between the receiver of something you make and the funder who is involved with you. There’s a wonderfully fulfilling feeling with that.”

Naturally, the success of Fund It prompts a bigger conversation on how the arts should be funded. Should audiences be paying for creative projects? Should the State? Should brands and business sponsors, or philanthropists or corporate-responsibility accounts be mined deeper in an era where nearly every festival has an alcohol brand, mobile-phone company or corporate sponsor attached just to make it viable?

“It’s the blend, right?” McLaughlin says, “That’s where the answer lay for me. If you spend time here, then people look at the States as this holy grail of private funding. And if you spend time in the States, they’ll tell you how jealous they are of our public-funding structure here. Both are overly reliant on the extreme. The answer lies somewhere between those. Philosophically and fundamentally, I think it’s vital that the State plays a role in it, that the State is a significant funder of arts and culture. It can’t disappear, its role is set, and it can only reduce its role through effective policy.

“Something like Fund It should be part of that discussion, actually, because what you should see now is an organisation going into the Arts Council to say ‘we’ve raised €8,000 of the funds that we need for this theatre project on Fund It. We know box office is going to bring in this much, so we’ve activated our audience this way. Then this is the gap.’”

When it comes to the “blend”, Fund It practices what it preaches, gaining funding for its own set-up from a mixture of public and private sources. The then Department of Arts, Sport and Tourism gave €20,000 in a cultural-technology grant. The Arthur Guinness Fund committed €50,000 over two years along with mentoring and other resources. Fund It charges a 5 per cent commission on the total amount a successful project receives, plus 3 per cent in banking and payment charges to cover the costs of its merchant bank, payment-service provider and retail bank.

Projects that don’t succeed usually fall down on a few elements: poor quality of the project, the lack of a sizeable network of people to mobilise into funding it and spreading the word, an unrealistically high target, or a project running out of steam as the deadline arrives. But Fund It’s success rate is extraordinarily high for a crowd-funding website, at 78 per cent. The average success rate internationally for crowd-funding websites is around 46 per cent.

Oddly, the project that raised the most money (€24,375) wasn’t something that you’d expect to see on Fund It. Joanne MacMahon and Laurence Gill from the Department of Civil, Structural and Environmental Engineering at Trinity College had implemented a successful solar water-disinfection project in the village of Ndulyani in Kenya in 2008, only for the village’s water source to dry up three years later. Prompted by the Science Gallery in Trinity College to check out Fund It, they brought their project to the website, raising 110 per cent of their €22,000 target. For MacMahon, an environmental engineering PhD student, it was “a totally different way of raising money for people in academia. But we thought we’d just try it, as it is the type of project people are interested in.”

With a week to go, the project made close to €10,000, with 201 funders pitching in. Now, the engineer who did the original project is just back with a new survey. They’re hoping to have the project completed for the end of the summer. The 600 people living in the village have had to make a 14km round trip to collect water since the water source powering the initial system broke down. “It’s a very isolated area and it’s a very hard way of life,” says MacMahon, “but they’re really excited that we’re going back again, which is brilliant. They’re delighted.”

Right now, the 5 per cent commission doesn’t cover the running of the site. The team has to figure out how to make it work as a commercial proposition, even though it’s ultimately a social enterprise. Over the year, brands have approach them regarding site sponsorship. They are looking at potential partnerships in various creative industries. And there’s also the horizon beyond that sphere.

“Outside of the creative industries there are probably areas and industries it could work within as well, sport being the obvious one,” says McLaughlin, citing the GAA network as being particularly powerful and generous. “Fund It is slightly accidental. A top-down attempt of how we think about funding culture isn’t going to work. This is a ground-up idea.”

Cash mob: Fund It highlights over the past 12 months

Where Were You! Still Films with Garry O'Neill€7,168 (110 per cent of the target) was raised by 182 funders to make a photography book and accompanying documentary of 50 years of youth culture and street style in Dublin. The hardback book has been published, and a paperback is on its way. The documentary is also in the works.

Misterman, Landmark Productions and Galway Arts Festival€16,145 (107 per cent of the target) was raised by 115 funders for Enda Walsh's play starring Cillian Murphy. The production needed €15,000 along with an Arts Council grant and box-office income to stage the play at the Galway Arts Festival in 2011. Misterman went on to rave reviews at St Ann's Warehouse in New York and makes its UK premiere on the Lyttelton stage at the National Theatre, London in April, running for 34 performances.

First Fortnight Arts Festival2012's arts-based mental-health awareness project raised €5,390 (107 per cent) from 119 funders to fund its programme of events in a festival that received major media exposure and public support.

Camden Palace's Stageless ThespiansThis campaign raised €3,800 (102 per cent) from 43 funders to build a stage in the theatre space at the Camden Palace Hotel in Cork.