Should you be crowdfunding?

Crowdfunding is a huge growth area of income for voluntary and community organisations. Nesta, the innovation charity, estimate that rewards based crowdfunding raised over £26 million last year.

So what is crowdfunding?

Crowdfunding is a way of funding a specific project by raising donations from the people and community around you, usually through a time limited campaign.

It’s not new; war memorials, plaques and benches have been funded by small donations from communities for centuries. But the way that social media has developed has provided the perfect conditions for crowdfunding as a fundraising tool to flourish, helping increase reach to new networks of potential supporters.

There are different types of crowdfunding, from donation-only through to equity based, but rewards based – where in return for backing a project you receive a ‘reward’ – tends to be the most popular for community organisations and social enterprises.

Why should you be interested in crowdfunding?

Crowdfunding can help you harness the goodwill of your supporters to back your project. A crowdfunding campaign can also provide transparency, as people funding a project know exactly how their money will be used. People tend to give more to rewards based crowdfunding campaigns.

Crowdfunder offer rewards based crowdfunding and have found that the average pledge on their site is five times higher than on donation-only sites. Nesta looked at rewards based crowdfunding campaigns from 2010 -14 and found that the average donation was around £49.

Crowdfunding can be about more than just raising funds, not only do people give more they are also more likely to share your campaign with others. This can help you widen your reach, build up your supporter base and gain access to new networks.

You can also use a campaign to try out and develop new fundraising messages with existing and new audiences, then roll them out  across your other fundraising activities.

Crowdfunding works best for specific, time-limited projects. It’s not going to be a regular stream of income for your whole organisation, but it could help you get that great idea off the ground, with a ready-made community already backing it to succeed.

Crowdfunding has grown rapidly over the past couple of years, which means there are lots of resources and learning already out there to help you get it right.

Why are we interested in crowdfunding?

Funding Central isn’t just about searching for grants, contracts and loans, we want to help voluntary organisations think about their complete funding mix. Earlier this year in our annual user survey we asked our users about crowdfunding. Only 6% of people said that they had already run a crowdfunding campaign. But about 2/3 said they would think about crowdfunding as a funding option, or they didn’t really know where to start.

So we have been working with Crowdfunder, the UK’s largest rewards based crowdfunding platform, to help make sure crowdfunding opportunities are being realised.

Maximising your campaign through match funding

How crowdfunding has created new ways for voluntary organisations to secure match funding for their projects is one of the areas we’re most interested in. Successful crowdfunding projects can help identify real demand for a project or services in an area, this success then helps validate the concept of the project.

Some funders, local authorities and business are already doing this, and we think this will be a growth area. There’s a much larger role for grant funders, local authorities and business to match fund successful crowdfunding campaigns.

But more on this in our next post…


Like all fundraising, running a crowdfunding campaign will take time and resources and will need to fit into your overall fundraising strategy. That’s why we have produced a range of free guides to make your crowdfunding campaign a success.

We’ll also be sharing tips from successful crowdfunding projects on Crowdfunder over the next six months, so do keep an eye out.


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Toby Lovatt is the project manager for Funding Central, an NCVO website which provides information on grant, contract and loan finance opportunities as well as funding support and advice for the voluntary sector.

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