Why we did this?
Rewards and donations based crowdfunding has grown exponentially over the last five years. As it has expanded as a market, institutions, local authorities and other funders have been exploring how they can match their grant funding with the crowd in order to find projects more efficiently, stretch the amount of money raised and reach organisations and individuals outside their normal funding programmes.
Despite this, very little formal research has been conducted on these match funds - and none of them have focused specifically in the arts and heritage space. We therefore piloted our own campaigns in order to try and learn about the impact that this new form of funding has on the crowdfunding landscape and the individual projects that try and raise funding.
This work stemmed from a specific recommendation set out in the Department for Culture, Media and Sport’s Culture White Paper.
What we did?
We launched two campaigns on Crowdfunder to help fund projects from individual artists in England and heritage organisations in the North West, South West and Scotland.
Between £2,000 and £20,000 was available to match a total of 50 per cent of a crowdfunded project, with the other 50 per cent coming from the crowd. In total, £125,000 was available in funding for both the arts and heritage sectors.
Once the funding was distributed, we analysed the impact of the mixed funding model and evaluated the programmes that successfully crowdfunded for their project.
Main lessons learned
- Matched crowdfunding can help leverage additional funds. The £251,500 in match funding provided by Arts Council England and Heritage Lottery Fund within the pilot helped leverage an additional £405,941 from the crowd of 4,970 backers.
- Many of those who fundraised through our pilot reported a series of longer lasting impacts beyond the short term injection of cash, such as new or better skills in a range of areas, a stronger public profile and attracting new supporters they continue to engage with.
- The introduction of matched funding would play a significant role in whether those that successfully fundraised for their project through the pilot would do so again.
Read more about our findings and the long-term impacts of matched crowdfunding.
Nesta has conducted a wide range of programmes and research in the field of crowdfunding and the sharing economy over previous years. In particular, this work built on:
- the Innovation in Giving fund, which distributed £10 million in grant funding to ideas and projects that encouraged people to give more.
- the Crowdfunding Good Causes report, which sets out the landscape of opportunities and challenges for charities in relation to crowdfunding
- Pushing Boundaries: The 2015 Alternative Finance Report. This work tracked the size and shape of the wider crowdfunding sector over time, specifically pointing to trends and areas of expansion and contraction within the sector.