Nonprofit crowdfunding is giving, not buying

Picture of blank billboard with "not being sold" written on it

It’s an easy mistake to think about crowdfunding in terms of the big stories which involve early access to a physical thing. Items like the Pebble watch or the Oculus Rift have created huge buzz for their Kickstarter campaigns because the “perk” of the campaign was only available to people as a Kickstarter reward. In cases like this, the “contribution” is really a pre-sale. It’s a great way to get money before a product is ready.

But that’s not what charities do.

The rewards of a crowdfunding campaign shouldn’t be a that one-dimensional if charities are using the tactic to raise funds and support. If a nonprofit feels it can make a bank just by selling perks, it may be time to consider a for-profit spin-off or a B Corporation to go make that money all the time. Reducing the value of the nonprofit work to a simple sales transaction misses an opportunity to help community members understand that charities need support all the time. The crowdfunding campaign should introduce an urgent need for some new support, but it will never replace the need for ongoing contributions.

A great campaign will leverage the unique rewards it can offer which aren’t simply sale prices of a physical good. Sure, a free ticket to a show is nice, but how about an exclusive meeting with the artistic director to talk about the vision for the show? This isn’t a “good” in the traditional sense, but it is a singular value that supporters can’t get elsewhere and serves to bring the donor closer to the mission of the organization. A donation is great, but a donation which brings a new mission advocate is better.

Not all rewards need to be directly from the charity in order to leverage mission connection. If your local politician or business owner is a great supporter of your work, ask if they would offer a couple of lunch meetings or a coffee as an incentive. Presumably, both parties would share what they like about the nonprofit which brought them together, and it costs next to nothing for this perk. A t-shirt or mug gets your logo in front of some folks,but not likely for long as they get stowed with the overstock of other charity branded gear in the closets of donors. Experience rewards are better ways of winning the hearts, and not just the pocketbooks, of supporters.

Perks are just one element of a successful crowdfunding effort for nonprofits. Download our whitepaper on the topic for in-depth discussion of the other factors which really make the most of this tool.