While enterprise start-ups, creative projects and charities have raised millions of pounds using crowdfunding over the last five years or so *(£9 million in the first three months of 2014 alone), councils have so far been very slow to harness its power for the public sector. But a new report by crowdfunding platform, Crowdfunder.co.uk, shows that a few are beginning to see the potential of this type of community fundraising.
“Grants, Loans and Crowdfunding – The New Funding Mix” features councils and not-for-profits that have tapped into the vogue and suggests it as a way to bridge cash gaps, further community involvement and create strong local businesses and projects.
Barry Sheerman, Chair of the Westminster Crowdfunding Forum, shared, “This report is a valuable resource for public funding providers and local authorities outlining the benefits crowdfunding can bring to the sectors as a whole.We are approaching an exciting time for the industry with huge growth and sustainable opportunities for communities to embrace crowdfunding – match funding and public-sector buy-in will play a vital role in strengthening society across the UK.”
According to Phil Geraghty, MD of Crowdfunder, such a funding mix offers big opportunities because projects raise more once potential backers see that others are supporting something. He noted, “Getting councils involved opens up opportunities because it connects communities and unlocks funding – both private and public.”
The report came about because Crowdfunder was starting to see a new funding mix happen at local level and saw its power. Geraghty stated, “Amazingly, though crowdfunding is one of the fastest growing forms of finance – growing by 388% last year – and the UK is the second biggest market in the world, we found a real lack of awareness from councils and grant-giving bodies about how it could compliment what they do and use it to best advantage. The aim of the report is to provide some practical advice and inspiration.”
Jaspal Sohal, Head of Games & Digital, Creative England added, “We’ve been looking into new and innovative ways to make our funds go further, and how we target our funding to more diverse groups. Crowdfunding is proving to be an exciting solution, helping us to engage with some fantastic projects while enabling us to match-fund projects in the creative sector.”
The report in full can be downloaded here.