Access to finance is still a big barrier for many digital social innovators, despite being able to draw from free ‘open source’ services and open data. Crowdfunding is playing a growing role in supporting these new ideas to get off the ground. It is one of the best examples to illustrate how online networks can disrupt traditional ways of doing things.
Using small contributions from a large number of sources rather than through large amounts from one or a few, it provides an opportunity to bypass traditional funding streams such as grant applications or bank loans and to directly access online communities interested in supporting your specific idea or cause.
While it is often Kickstarter with its gaming consoles and film projects that grab the headlines, when it comes to crowdfunding, there is a wealth of smaller platforms focusing specifically on supporting projects and businesses with social purpose. For example, Goteo is a Spanish open source social network for both crowdfunding and collaboration; it helped both Smart Citizen (a citizen sensor kit) and Tuderechoasaber (an online democracy project) to raise funding from the crowd.
There are so many platforms operating in the UK to choose from that we created the CrowdingIn.com Directory to help people choose the right crowdfunding platform for their project. There is a lot of choice - Spacehive has been pioneering crowdfunding for projects in the public space in the UK, whereas buzzbnk.org and Crowdfunder focus particularly on crowdfunding for community enterprises.