The downside to crowdfunding
June 06, 2013
Just a few weeks or months after a song makes its debut on the radio, if it's a popular one, many people quickly find themselves sick of the tune. Too much exposure is often a bad thing in this sense - no one wants to listen to the same thing over and over again. This also tends to be true in the technology sector - it can be cool to use the latest gadget or service, but after some time, the shine starts to wear off.
This has been seen recently in the nonprofit sector, especially in the realm of Internet fundraising. Crowdfunding websites like Indiegogo and Kickstarter were all the rage just a few months ago, but people are largely stopping buying in.
In the wake of success seen in the "Veronica Mars" movie campaign on Kickstarter, actor Shemar Moore took to the site to raise $1.5 million for his new venture "The Bounce Back." However, it's been largely seen as a failure - Variety reported that he earned less than $75,000 in the first four days - which are usually integral to success - and it's only slated to earn $450,000.
The Daily Dot suggested campaigns like this are failing because they're too lofty and aren't realistically predicting the number of backers. Plus, consumers can tell if the leader just isn't passionate, so donors won't be either.
As foundations tap into emerging digital channels to raise funds online, they can benefit from nonprofit fundraising software that tracks incoming donations and quantitatively measures the success of their efforts.