Crowdfunding: A breakthrough innovation?

Date: 03.12.2012 13:00 - 17:00

Location: Nesta, 1 Plough Place, London, EC4A 1DE

This event featured expert speakers involved in running and using crowdfunding platforms across a range of sectors; from start-ups and creative businesses to schools and social entrepreneurs. Nesta also present research into crowdfunding across the spectrum.

The event included two breakout sessions:

• Crowdfunding for social good
• Crowdfunding for creative startups

Speakers included:

• Adrian Hon (Entrepreneur, crowdfundee and commentator)
• Patrick Hussey (Aeon Magazine)
• Ed Whiting (Commentator)
• Amy Cameron (Crowdfunding platform Solar Schools)
• Theresa Burton (Crowdfunding platform Buzzbnk)
• Nick Underhill (Crowdfunding platform Peoplefund)
• Jeff Lynn (Crowdfunding platform Seedrs)

Crowdfunding, the model through which finance is sourced by getting small amounts from many sources rather than large amounts from a few is on the rise. In 2011 alone, $1.5bn was raised through online crowdfunding platforms. The model has the potential revolutionise how funding is raised across a variety of sectors such as the arts, start-up ventures and public services.

It's another example of digital technologies fuelling an explosion in age-old behaviours. For centuries, people have used subscription models to build shared assets from small personal contributions. From families buying bricks to build mosques in the Indian sub-continent, to the citizen subscriptions that paid for the plinth that supports the Statue of Liberty.

With the spread and uptake of digital platforms we're seeing a new wave of innovations in crowdfunding: from simply putting together lots of small donations to create a larger fund, to offers that include rewards or products in exchange for donations, to crowd-loans and increasingly crowd-equity.

As well as capital, crowdfunding can bring other benefits; artists can create an audience before they create the work itself; businesses can establish a pipeline of customers and network of brand advocates; community projects can pull in potential donors, users and contributors. But what are the limitations of this, and what potential has not yet been exploited? Nesta is convening some of the most inspiring crowdfunding commentators to try and unpick fact from fiction and discover whether crowdfunding really is a breakthrough innovation.