Crowdfunding Social Enterprise

Crowdfunding andSocial EnterprisePaul Dombowsky

• Who are you?• Funding Options• What is Crowdfunding?• Who’s doing it?• Best Practices• Making the Pitch

Overview

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• Does your organization type influence how funds are raised?• What does the open market think about funding social enterprise?

Who Are You?

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• Influenced by what type of social enterprise you are• Non-profit enterprises• Social purpose businesses

• Social Enterprise Grants (local/provincial/federal governments/foundations)• Social Enterprise Financing• Venture Philanthropy• Loan Guarantees• Bootstrapping & Funds from Operations• Social Capital Pools – Social Venture Partners• Angel Investors – Clearly So• Community Loan Funds• Crowdfunding – Fundchange?

Funding Options

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Social Enterprise Financing

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• A crowd

• Business challenge / problem / question you want answered – ideas

• A process and tool for engagement

• Trust and commitment in your crowd to take action

• Key performance indicators – what does success look like?

• Proof of action – your crowd wants to see what happened

Crowdfunding - What do you need?

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Who is your crowd?

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SupportersProspectsS/E InvestorsMailing Lists Supporters’ Network

Prospects’ Network

S/E’s Network

Mailing List’s Network

The crowd you know The crowd you don’t know

Social Media Makes the Connection

PostPromoteFundReport

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Examples: Crowdrise (US only)

Funding source for entrepreneurs

Revenue ShareDebtEquity

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Examples: Profunder (US only)

PostPromoteShareSearch/FilterFundReceiptReport

Costs:$99 + hst to join

includes 2 postings3.9% processing fee

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Examples: Fundchange

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Projects or Doable Asks

• Easier for most people to wrap their head around a smaller project as opposed to a ‘cure’ or a ‘hospital wing’

• Examples:• Piece of medical equipment• Stream revitalization• Education program• Conference attendance• Sports equipment for a couple kids

• It’s social – the crowd promotes projects it likes• It’s social – the crowd won’t promote projects that aren’t

shareable• Success comes to those that actively build a crowd • A challenge for organizations new to social media

• It’s the free market at work• It’s the free market at work

• Build stickiness to the project• Need to pay attention to write-up to inspire funders

Benefits & Challenges

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Social Enterprise Funding

• Small investments from grassroots and community based supporters

• Determine your model• Does Fundchange fit the bill or is another model needed?• What is the localization factor?– City– Province– Country– Category based

Things to keep in mind: • Crowdfunding success comes quickest to organizations that are social –

media-aware and engaged. If your organization is not yet social media-enabled, it will take time and human and financial resources to do so.

• Because your efforts are only as good as the crowd you are able to mobilize to your cause, it makes sense that your organization strategically manages and promotes its brand online.

• Make sure your target audience is online and will give online• If you opt to post your projects on established crowdfunding sites, do your

homework – be careful of the company you keep.

Integrating Crowdfunding into Your Organization

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• “The Wisdom of Crowds” – book by James Surowiecki• “Crowdsourcing” – book by Jeff Howe

Resources

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Thank you

Paul Dombowsky | 613.878.1681 | paul@ideavibes.com