Crowdfunding, Fandom, and the Future
One of the main goals of my blog is to bring awareness and broaden the knowledge that people may have about Crowdfunding and Fandom. I’ve established how fans are exploited for their labor and why fans give of their time and money, but what of it’s future? I want to continue by reviewing new crowdfunding platforms, the business of crowdfunding and why we should be cautious.
Watch the PBS Idea Channel’s Future of Fandom video to find out what might happen in the future for these studies:
While Kickstarter and the entertainment campaigns on it are solely for funding for their productions, we must look at crowdfunding for what it is, a business. The investors of a crowdfunding campaign need to be aware of what is going on. “Let the buyer beware” so to speak. In “Crowdfunding: Fleecing the American Masses” (2012), by Zachary Griffin, he shares that crowdfunding relies on the public to solicit and advertise so they can bring in the “crowd” of investors. The main idea of using the Internet is that it permits entrepreneurs to advertise their business and gain investments from just about anyone around the globe. It’s important to remember that even those entertainment campaigns I’ve researched about and blogged here, are soliciting a fan for money.
You may recall the mention I made of fans calling the shots. Today “fan-vestors” are making more decisions than anytime in the history of fandom. One of the conclusions made by Galuszka and Bystrov the researchers for the article, “The Rise of Fanvestors: A Study of A Crowdfunding Community” (2014) is the fact that fans are beginning to realize their ability to make decisions within a campaign. Fans are helping those that are campaigning by supporting them in whatever way they are asked to do so, and in return, fans are helping with the creation. Galuszka and Bystrov go on to say that there has to be a connection for those investing in a crowdfunding campaign to be successful. Hence why the fan-based campaigns seem to do so well. In certain circumstances, there is a social aspect to crowdfunding, and in many ways, it is an online community (Galuszka & Bystrov, 2014). I have established that fandom is a collective intelligence that offers a place to belong, so it is this researcher’s foregone conclusion that fan-based crowdfunding campaigns must rely on those fans for a successful crowdfunding campaign.
Campaigners give rewards for donations and depending on the amount given the rewards can be worth it to a fan, but there is a cost. Richard Lawson, a writer for the Atlantic Wire the online magazine, wrote about the investment of the Veronica Mars project:
In Veronica Mars’s case, they’re asking you to pay for what will ultimately be a studio movie. This is not some independent film, financed on credit cards and bake sales. Nor is this an investment that anyone who donates will ever see a return on; essentially you’ll be a pro bono producer. There’s even a joke in the campaign’s introductory video about giving donors an associate producer credit, the joke being that the title is itself a joke. Aside from some assorted rewards that only get good in the really high donation brackets, the only thing you get in return for your investment is the movie, which (depending on the size of your investment) you’ll have to pay for anyway (Lawson, R. 2013, para. 2).
Lawson has a valid point, even saying that if fans are now the producers (funding the campaign), then they should have their name on the credits as well as the percentage of what was backed (Lawson, 2013). Fans will invest in future mediums anyway, as Lawson says, but today they have more of a say and can drive a project. Rob Thomas, the creator of Veronica Mars mentioned that he first thought that he would only have to worry the first few weeks of the Veronica Mars project, but then he realized he had fans’ tastes and preferences to consider and the fact that the pressure to write what the fans wanted and not what he wanted took precedence in order for the production to be successful (McMillan, G., 2013). What Thomas realized was that fans can make or break a project, and creators have to take that into consideration when campaigning for funding on sites such as Kickstarter.
If you remember I already shared the four main methods of giving, 1) donations, 2) rewards, 3) repayment of debts, and 4) equity (Spirer, 2014). I also mentioned earlier that Kickstarter was not the first or only online crowdfunding platform; that award goes to a site called Kiva. Kiva is a “repayment of debt” method of crowdfunding.
Kiva was one of the first crowdfunding sites, established in 2005 (Bannerman, 2013). Kiva is a non-profit crowdfunding site “with a mission to connect people through lending to alleviate poverty. Leveraging the Internet and a worldwide network of microfinance institutions, Kiva lets individuals lend as little as $25 to help create opportunity around the world” (Kiva.org, 2014). Here is how it works: a person goes onto the site and searches for a borrower; once they find the borrower of their choice (and there are thousands to choose from), they fund part or all of the loan to the borrower. Once the lender receives full payments back from the borrower, the lender has the option to give that same money back to another borrower, if they so choose (Kiva.org, 2014). Many students in higher education are using this site to fund their educational goals. Sara Bannerman wrote the article, “Crowdfunding Culture” (2013), in it she shares that Kiva has established a new form of crowdfunding where there is a sense of community and responsibility. Kiva removes the layers of anonymity often found in other crowdfunding models and offers a real community where both lender and borrower become connected.
GoFundMe.com is another crowdfunding site for people of all walks of life. GoFundMe.com is a “donation method” site. It is a personal online fundraising site, and the motto is, “Crowdfunding for Everyone” (GoFundMe.com, 2014). GoFundMe has various funding platforms, from helping a family finance an adoption for a child, to funding a young girl with cancer so she may receive the transplant she needs to survive.
Another new crowdfunding site called Crowdfunder.com is more for capital and small businesses, but it is a site that allows people to invest in a project where they become key stakeholders. The site states that they provide investors “the opportunity to profit financially from their investment” (Crowdfunder.com, 2014, p. 1). They also state that where Kickstarter offers rewards for its backers, Crowdfunder offers investments in exchange for equity.
Sites like Kickstarter are “reward” based crowdfunding sites, and currently the most popular type of platform. With sites like Kickstarter, a person can give in return for a reward or gift. Besides the sites already mentioned, it is important to note that because of the success of the Veronica Mars and Reading Rainbow campaigns on Kickstarter – several other crowdfunding sites specific for funding film and television productions have been established, sites such as Indiegogo, Juntobox, and Rockethub. Each of these sites offer an alternative creative outlet for certain types of creators and that of funders, it is up to the one donating to decide which one works for them. Patreon is another new site established for artists and those that want to sell their art.
On a cautionary note, along with exploitation and labor another issue to take note of is the issue of fraud. Although crowdfunding sites establish rules for their borrowers and investors, there have been people creating campaigns for donations who are not in need of funding for any project; they just want the money for their own gain. Someone like Amanda Palmer comes to mind: although she says she is creating an album, the album has not been finished. Consumers definitely need to be aware and educated when giving funds to a campaign. I found a great SWOT analysis for crowdfunding in the academic article called, “Valuation Of Crowdfunding: Benefits and Drawbacks” written by Loreta Valanciene and Sima Jegeleviciute (2013). SWOT stands for “Strengths, Weaknesses, Opportunities, and Threats.” Granted their report was for basic crowdfunding campaigns, but I believe their analysis can be related to fan-based crowdfunding campaigns as well. The threat element is a risky assumption, and I would be remiss if I didn’t share the data. The chart below offers these four categories of the SWOT. As one can see, there is still more research to be done in this field, but it is important to note the weaknesses of fraud, stolen ideas, lack of advice and the threats of legal restrictions and the risk involved in small businesses, most of which were touched on during my case study blog posts.
Only time will tell if any of these sites mentioned above will continue to flourish, but there is the hope that these sites, which provide more than just backing for a movie, will continue to provide the livelihood and social capital for those people seeking a chance for a better life. Commercial motives fall into play for almost every kind of industry. Films are no different. Crowdfunding gives creators, artists, screenwriters, producers, and storytellers an alternative to going to a big studio to find an executive willing to support and fund one’s creations. The most crucial aspects of crowdfunding lay in the fan base of the campaign, and how the pressure from the fans, makes it all the harder for creators.
Crowdfunding and fandom have changed each other, both needing and exploiting one another in many ways. The real game changer in crowdfunding is the people who fund it, the fans, the everyday people who just want to be happy in providing a way for those seeking financial backing. There will always be fans and some who are willing to go the distance to see their favorite film, artist, TV show, or book, come to life. But today fans have more of a choice than I did back in the “Jerry Lewis Telethon” days. Today more than ever fans have a say so in the way they are able to view and support their favorite medium.
I have no doubt that fans have their agency and will always be willing to give of their time and money in future crowdfunding campaigns. It is my hope that reading this blog will offer some insight to why a fan gives so much of themselves, an understanding of how they can be exploited, and that the business of crowdfunding can take precedence over their own desires. When fans know what they are getting into with crowdfunding the better they will be.
About Us. (2015). Crowdfunder.com. Retrieved from https://www.crowdfunder.com/blog/about-crowdfunder/
About Us (n.d.) About Kiva. Retrieved on December 15, 2014 from http://www.kiva.org/about/how
About Us (2014).About GoFundMe. Retrieved on December 15, 2014 from http://www.gofundme.com/
Bannerman, S. (2013). Crowdfunding Culture. WI Journal of Mobile Media. Vol. 7, No. 1. Retrieved from http://wi.mobilities.ca/crowdfunding-culture/
Galuszka, P. & Bystrov, V. (2014). The rise of fanvestors: A study of a crowdfunding community. First Monday, [S.l.], apr. 2014. ISSN 13960466. Retrieved from<http://firstmonday.org/ojs/index.php/fm/article/view/4117/4072>. doi:10.5210/fm.v19i5.4117.
Howe, J. (2009). “Crowdsourcing: Why the Power of the Crowd Is Driving the Future of Business.” New York: Random House.
Lawson, R. (2013). Anyone Know of a Better Charity Than the ‘Veronica Mars’ Movie? The Wire, Atlantic. Retrieved from http://www.thewire.com/entertainment/2013/03/kickstarter-kind-of-annoying-isnt-it/63060/
McMillan, G., (2013). Veronica Mars KickStarter Breaks Records, Raises Over $2M in 12 Hours. WIRED. (13, March 12). Retrieved November 26, 2014, from http://www.wired.com/2013/03/veronica-mars-kickstarter-record/
Spirer, G. (2014). “Crowdfunding: The Next Big Thing. Money-Raising Secrets of the Digital Age” CreateSpace Independent Publishing Platform. Kindle Edition
Valanciene, L., Jegeleviciute, S., (2013). “Valuation of Crowdfunding; Benefits and Drawbacks” Kaunas University of Technology, Lithuania http://mechanika.ktu.lt/index.php/Ekv/article/view/3713/2499