Some bridges and fences – New Platforms for Action


In my very first post, I talked about how the evolution of social technology has made relationship-building and connecting people with one another key to simultaneously growing businesses and doing social good. This morning I read an interesting post from Annika Small of Nominet Trust, who in writing about scaling social innovation, puts it in similar terms: “technology supports the development of solutions that are tailored and accessible to individuals while also enabling their wide distribution at significantly lower cost than traditional services.”

So, with that as a starting point (and after quite a few months of not doing what I promised to do, i.e. writing about actual companies and products), I’d like to start exploring what might make individual social tech products into true ‘bridges’, in bringing their user bases together behind a common purpose – or, conversely, what makes them function more like ‘fences’, constricting rather than magnifying people’s natural urges to connect with others, and do good.

I’d like to start in this blog with a few social action platforms. ‘Social action’ is quite a buzzy phrase very much in vogue amongst the policy wonkerie, which as I understand it (and I could be wrong- if so, do shout in the comments section below!) is about people taking relatively autonomous and dynamic actions to advance a particular social goal.

So while it’s like (and can indeed encompass)’ volunteering’ as traditionally understood,  I think there’s a bit more to social action than that – something about making a particular change happen and rallying others behind it, that goes a bit further than what we usually mean by volunteering.

And for the purposes of this blog, let’s rule out petitioning.  Yes, there’s no question that it can be a driver of real social change, and as the Indy reported last year, it’s a really exciting space – as the article mentions, between 2007 and 2009, the rate of online petition signing more than doubled, from seven percent to fifteen percent – with groups like 38 Degrees amassing a pretty impressing achievements list, and my personal favourites, AllOut, making big international political changes happen for LGBT communities across the world. But what I’m really interested in here are platforms that encourage individuals to take a variety of actions involving some sense of investment in the outcome – often of time or skills.

Here are 4 platforms trying to do just this, although with subtlely different ways of going about it:-


  1. WeWillGather, run by Dan Thompson (who among other things, invented and spread the #RiotCleanup hastag to mobilise action following the 2011 London riots) has had some great support since its launch last year, and is based on a simple premise – come up with an idea for a Good Thing (as they term it) that you need to build some support to make happen, create a page for it on WWG, tweet about it and they will too, and your crowd with gather. The platform features some smashing Good Things already successfully carried out, like guerilla grime busting at Elephant and Castle.
  • WWG allows organisers to make an immediate ‘ask’ of their follower base, and seems to be predicated on low commitment, small-scale local actions. The strength of the platform looks to be in the immediacy that each Good Thing organisers’ ‘ask’ can achieve – hence the use of Twitter as the primary means of sharing/ promoting your Good Thing through WWG – supported by a requirement to set a clear signup target for your Good Thing (so if you subscribe to the WWG feed, be prepared for a lot of tweets saying ‘We need [insert number] people to make a Good Thing happen in [insert place]). WWG acknowledges that not everyone will want to contribute to every Good Thing all the time, but its success depends on a wager that (a)the tools offered to project leaders will be sufficiently powerful in helping project leaders access their own (and their friends and family’s) networks and (b) they’ll hit the ‘sweet spot’ of Good Thing opportunities advertised through the WWG Twitter feed reaching individuals with a prior inclination to get involved at a time when they are most inclined to say yes.  And while (a) can be solved through an ongoing conversation with Good Thing organisers and getting some appropriately inclined individuals signed up to its feed should solve itself with some good publicity, getting the second part of (b) right is a really interesting challenge.


 2. In contrast to the immediate and ‘sweet spot’ approach of WWG, the Civic Crowd seems to have set its sights on brokering longer-term relationships between grassroots organisations and local (actual and potential) supporters. As you’ll see by having a look at the homepage, navigation is driven through map, with a handy Google locate tool suggesting projects local to you from the get-go. Following a recent refresh, the platform supports users to undertake a range of interactions from ‘liking’ and sharing particular projects with your social networks to supporting them with your cash through the platform’s crowdfunding feature (well, sort-of crowdfunding – you can make donations to projects, which is great, but I couldn’t yet see the kind of project totalizers and ‘all or nothing’ funding approach that makes Kickstarter and co such fun), and is equally open to one-off projects and established community groups and organisations. As it looks like you could start and post a project just as easily in Goa as in North London, the platform’s clearly got some space to grow, if it needs.


3. While both WeWillGather and Civic Crowd are about encouraging people to list and get involved with local projects in as frictionless way as is possible, Blue Dot – launched at the back end of 2011 with a huge blitz around Children in Need – pitches its USP at giving those already volunteering and giving money something in return.  The idea’s simple – everything you give to charities signed up through Blue Dot, both through time and money, gets you Dots (1 dot for a facebook ‘share’ for example), which can be cashed in for treats. For example, currently being advertised in the marketplace is a signed Elbow CD for 400 dots, and 25% off yoga wear from 40 dots. As the platform makes its income from its business partnerships, contributions through the site reach the recipient charity without any commission being taken, which is rare, and quite cool. And with a fair range of suggestions for volunteering already in the ‘more ways to get dots’ section of the site, there’s real potential for the platform to become a portal for users to discover new social action opportunities, albeit perhaps with a slightly more ‘transactional’ motivation.


4. And finally, the box-fresh Good people (launched around the turn of the year) tries to do something a bit more familiar, hosting a kind of a dating service to match people declaring an interest in working with social action organisations with organisations with something to offer. Signup is short, simple, but very carefully segmented, offering ‘Good People’ the chance to get involved from the basis of curiosity (with the prompt of “I’m interested in discovering early-stage innovations and ideas”) to vocational and financial need (“I want to change the world for a living”).

In contrast to the platforms mentioned above, Good People is not predicated on winning over ‘casual’ users who come to the platform ‘cold’, but instead seems to be about growing a ‘hard’ network of regularly engaged Do-gooders. Like WeWillGather and Civic Crowd, Good people is agnostic to whether these organisations are operating on a for profit or not for profit basis, leading to a pretty broad set of participants, and one other thing I really like about the platform is the exacting segmentation of users from across the spectrum, from the curious early adopter to the creative looking for work. It’ll be interesting to see if and how users might move along the spectrum, perhaps starting with engaging on an ‘ideas’ basis, while through time getting more and more involved with an organisation, perhaps even to the point of being paid by them.

While I’m here, I also absolutely love the ‘pledge’ that takes the place of detailed terms and conditions on Good People, so thought I’d share it:-

“I hereby pledge to repay the value that the good people community provides for me and/or my organisation.

  • I will be good, and help support others. I’ll put back as much – if not more – than I can take.
  • I will act responsibly at all times, and notify GoodPeople if I see people that aren’t behaving appropriately.
  • If it works for me, I’ll tell others. If it doesn’t. I’ll help improve it with my ideas and suggestions.”

Where now?

While they’re all pretty new and definitely have time to find their feet still, none of these platforms have yet hit what could be described as a breakthrough – and with at least 3 out of 4, have gone through a couple of iterations since launch. Looking at a few other examples, here are a few slightly generic thoughts about how each could go about the hard business of pushing growth even further:-

  1. Think really carefully about the value your platform can offer to everyone engaged with it, and they’ll use it more – or in short, do what Hailo did. As Wired’s analysis made clear, what has made cab hailing app startup Hailo scale really fast (in a pretty competitive market) has been the tools it offered to help cab drivers rather than just passengers (who would usually be seen as the primary customers of the app), which has got it a 40% cab driver user base in London. I do think there’s a lesson here: just as Hailo’s founders had to get beyond the assumption that cab apps had to be structured solely for the passenger, so social action platforms should continually think about how they can provide tools that help the project/ Good Thing leaders want to use and depend on their platform.
  2. Define and build your first user base very carefully – This is something that at least a few the platforms above look like they could do more, to tick up the signup and action lists at the very least. Tracking the growth of any successful web community and you normally find a starting point involving a really simple function and a tight user base – the best example of this (I think) is Facebook, photo sharing, and college communities. Who are the super-loyal groups of people who will help each of these platforms gain critical mass? For my part, I’m working on getting the RSA Fellowship involved, but it’ll take time (more on that in a future post).
  3. Collaborate and merge/ aggregate user ‘offers’ – There’s got to be some really interesting collaboration opportunities here – for instance, how tricky would it be to offer Blue Dots for actions discovered through Civic Crowd or WeWillGather? How about displaying users’ blue dots and Civic Crowd/ WeWillGather participation history on Good People profile, to help great activists show themselves off? It’d be really great to see new socially-orientated products and platforms collaborate more, and pool their user bases where they share common aims to become a bit more of a social action ‘collective’ – maybe this sort of thing is happening already, though, and if so, do add a comment below and tell me about it?

Finally, I know that there’s something missing from this blog – my own experiences of actually getting involved with these platforms. Well, in short, watch this space – I’ve signed up to each of these platforms, and promise to get going on Blue Dot, keep an eye on local activity on WeWillGather and Civic Crowd, watch out for exciting offers through Good People, and report back how any activities I get involved in go. If you do the same, please let me know how it goes in the comments thread below, or tell me about other such platforms worth exploring – I get the sense I may be only scratching the surface here….


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2013: A crossroads for social enterprise?


I rather liked this tagcloud on social innovation from the European Summer School on Social Economy (which sounds like a jolly nice place). So I thought I’d copy it…

It’s about this time of year (or maybe I’m a little bit late this time round) when various members of the commentariat start to look ahead with unbridled optimism to what the year ahead might hold in store. Some make predictions – and if that’s your thing, check this really interesting list out – but as I’m only at best an occasional blogger, I’ll stick to a fervent hope and aspiration: that 2013 is a year of further, and significant, transformation for socially-orientated enterprise.

Why does this stuff matter? Well, 2012 wasn’t a great year for ethical conduct and public confidence in our most avaricious private companies, and a year of exceptional volatility throughout the financial markets has frayed investor nerves and encouraged flight to safe havens. Conversely, with the mutual sector’s poster child reporting a bumper Christmas, there is an ever-increasing store of alternative financial models thinking about values-driven pitches for consumer and investor support (and as I said in my first blog, I think we are living in a world where businesses have become increasingly social in order to succeed). And partly as a result of all this, the demand and need for businesses predicated on social as well as financial return (from traditional charities stepping in to offer services where markets fail, to tech startups launching community-enhancing apps drawing on new public data) has in no way diminished.

This year’s opportunities

This is not a zero-sum game – for private enterprise to deliver optimal economic and social outcomes would surely be impossible without a thriving for-profit economy and top-notch socially-orientated businesses working alongside each other to deliver optimal economic and social outcomes. But I think what is really interesting about this year is the way that these two traditionally distinct sectors might merge – driven by a gradual (but intensifying) shift from a dependence on philanthropy and grants to more innovative forms of investment into social businesses, and new approaches to business models across the ‘not just for profit’ sector. For example:-

  1. New financial products that generate social impact in a sustainable and repeatable way are actually being created, instead of just being talked about. Goldman Sachs’ participation in a $9.6m social impact bond to underwrite investment in Rikers’ Island prison’s anti-recidivism programme – with the potential for Goldmans to take financial upside and downside across the life of the bond – locks private investment to social outcomes in a promising way. Scarcely a month passes without reports of new SIBs being mooted across the world: let’s see how many ultimately deliver both the social and financial benefit they promise, and what happens to the service users and investors when they do.
  2. Public services across ‘Western’ economies face new and unprecedented challenges as spending continues to tighten, forcing public bodies to think creatively about how they’re commissioning (and de-commissioning) services, and with whom. Have a read of Laura Bunt and Charlie Ledbetter’s the Art of Exit pamphlet for a really intriguing analysis of this transformational process. One thing that struck me in this pamphlet was the importance the authors assigned to commissioners getting in place a well-planned political and communications effort to mobilise popular support prior to changing the delivery model of a public service. Contracting with businesses with a clearly articulated social purpose – where their success creates direct knock-on benefits to the service users – could be a really powerful force supporting public service commissioners to do this adapt their services in a way that supports sustained public engagement and support. Which would of course have the happy impact of creating countless new opportunities for social businesses.
  3. Business and investment practices are starting to permeate from ‘traditional’ marketplaces to the social enterprise space, and vice versa:
  • Social investment funds are taking an increasingly adaptive and flexible approach to their funding portfolios – look at the Omidyar Network’s ‘priming the pump’ series for an example of how funds are starting to look at a look at adapting individual investments to market impact, using marketplace and sectoral analysis to determine the model of investment preferred in individual deals. JP Morgan and the Global Impact Investing Network last week forecast a 12% growth in this ‘impact investment’ sector in 2013, ultimately leading to $9bn in investment through the year.
    • Ideas starting off life in socially-orientated business are increasingly ceasing to stay there. For example, NESTA’s 2013 list discusses the prospect of big business stealing and adapting  collaborative consumption  approaches modelled by social enterprises in their practices. My money’s on a bit more of this happening in 2013.


Growing socially

So, things are definitely happening here. But where does this leave social business? The answer lies in your take on what’s needed to support growth in this industry – of individual social businesses and the sector as a whole – and what the positive and negative consequences of greater growth and scale could be.

On the one hand, there are strong views that the new models and investment that I’ve mentioned above bring risks as well as rewards. As Colin Crookes warns in this (generally excellent) blog published last week by the Guardian:-

“So in 2013 we will see the battle between scale (dressed up as impact) and social enterprise; large corporations with “social impact” departments backed by large investment funds against genuine social entrepreneurs using new legislation to promote social cohesion.” 

However, are those ‘genuine social entrepreneuers’ always the right people to carry businesses forward to maturity? Is it wrong for others (including ‘large corporations’) to get involved with social enterprise? As Crookes says, growing financial scale does pose challenges about how best to hold on to and embed social value. But the new conditions I’ve mentioned above also force difficult questions to be asked about how best to support social businesses to grow and expand successfully. And as mentioned in articles over Christmas, this is something London doesn’t always do very well, as we can get a bit too breathless about chasing the Next Big Thing and forget about the need to persevere at supporting sustained business growth over the longer-term. This conundrum- about how to support sustained growth without compromising social value- makes a lot of sense to me, as I’ve experienced it. For instance, this Harvard Business School article last week really chimed with my relatively brief experience as founder of one of the scrappy, 90%+ of low-profit social enterprises:-

“We can’t ask social enterprises to have a big impact if they can’t get the resources they need to grow bigger. In Britain, for example, fewer than 10% of the tens of thousands of social enterprises generate more than £1 million in revenue. Why is that?

One reason is that the scrappy, entrepreneurial approach that characterizes many of these organizations starts to break down as they pass that threshold. Normal business complexity sets in. Founding CEOs realize—or fail to realize—that their maniacal energy and personal devotion can only take their enterprises so far.”

Too true.


What now?

So, let’s be absolutely clear: I really, really want 2013 to be a transformational year for social enterprise. But, I think that for this to happen:-

1. We need to think really carefully about where the market failures lie where social businesses can add the greatest possible value, and be really demanding about the people and business models that will do this best, with investment responding accordingly (i.e. grants have their place, but so does investment and business generating significant return and revenue). In short, we’re going have to get really comfortable with the social and for-profit worlds coexisting in a much more integrated way…

2. … but we also need to recognise that in order for social businesses and the social enterprise to grow in a way that commands public and investor support (and holds on to the sector’s unique strengths), we will need to develop as much rigor and discipline about measuring and rewarding social impact as is applied to financial growth.

What do you think – am I overplaying the risks here, or do you agree? What are your hopes and fears for social businesses in 2013?

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What next for UK Crowdfunding?

When I was running WeDidThis, some of the most useful meetings we had were the slightly cautious chats with our competitors. We were lucky in that we were one of a number of UK crowdfunding sites launching through 2010/11, so there were plenty of opportunities to share our experiences and check each others’ progress without too much risk of industrial espionage. And when we got together, there was one assertion we always agreed on – by the time that US mega-platform Kickstarter launched in the UK, we would have needed to establish a viable business model and strong supporter networks, or face becoming Friendster to their Facebook.

Well, with Kickstarter’s announcement last month that it’s planning to launch in the UK, that day is fast approaching.There’s no question that their well-funded (rumour has it, by Amazon) operation, killer PR machine, and payments processing back end will have an impact – as their growth story shows, they’ve got this crowdfunding thing licked. However, all is not lost, and here’s why I think that:-

  • The nascent crowd of UK-based platforms – many of whom are developing a distinct and different approach to crowdfunding – need not pack up and go home just yet.
  • Even with Kickstarter taking up residence here, there is a lot more that our public  organisations (I’m thinking particularly of groups like NESTA, Big Lottery, and the Arts Council) can do to help creatives to seize the moment and make crowdfunding an indelible part of the way creative and social projects happen.

Made in the UK: our ‘home’ crowd

Here’s Hugh (Fearnley-Whittingstall): the Bicycle academy receive their cheque for their successful crowdfunded campaign on PeopleFund, from its founder.

As the picture above shows, there have been some notable successes from the UK platforms launching in the last couple of years. Looking ahead, it’s really encouraging to see the way that platforms are seeking to grow and assert distinct identities from one another:-

  • Some are building partnerships. Mike Troughton’s done a great job of building up WeFund over the last year, trousering a website of the year award, new investment and recently launching a snappy new design. WeFund’s Eureka moment seemed to come last summer with partnership with the Edinburgh Fringe, which they’re repeating this year – and their new equity crowdfunding offer looks pretty interesting. In my humble opinion, WeFund stand the best chance of being in for the long haul. Good luck Mike.
  •  In a similar fashion, FundIt have successfully used their access to the Irish arts scene (they are owned by the Irish equivalent of Arts &Business) to the bone. Both will face challenges in broadening the reach of their platforms, and it’ll be interesting to see if either follow Greg Vincent’s platform Sponsume’s route of going pan-European (getting into competition with other Euro platforms like Ulule). PeopleFund is not quite in the same league, size-wise, but have had some notable big successes already (the Hackney bike academy above, and Young Rewired State) and have a great opportunity to cross-sell to their massive and sympathetic River Cottage fanbase. Intriguingly, their strategy seems to be based around building up a collective of sites under an ‘umbrella’ brand, including mine (WeDidThis), Unbound, and an interesting partnership with Plymouth University to help more South West startups to grow.
  • Trying other pricing models – Unbound seem to have hit a sweet spot by pitching their pricing between the frankly exorbitant ‘normal’ publishing deal and the mega-generous 5% cut that most platforms demand. This ability to self-sustain on a much lower success rate should stand them in good stead.
  • Not-quite-crowdfunding – I’ve blogged about Crowdcube’s equity-based model in my last post, but it’s worth adding to that Buzzbnk’s option of making loans as well as donations, and SpaceHive’s place-based matched funding leading to much bigger projects getting funding, and there are some great examples out there of platforms promoting a different sort of crowdfunding alongside other offers to their users. What they lose in the ‘purity’ of the crowd (e.g. a donor giving £10 on SpaceHive towards a £120k project is a much smaller proportionate part of the crowd compared to most Kickstarter projects), they could make up for in diversity of their sources of revenue.
  • Kickstarter-clones – Sites like and Crowdfunder have done a great job of getting the word out (check out PleaseFundUs’s social media stats and you’ll see what I mean), and have clocked some notable successes.  They’ll have to fight hard to be heard once Kickstarter come to town though- and it’ll be interesting to see if this sort of platform stick with their current approach or evolve their model to provide something different.

Of course, as with any market place there are a players who haven’t yet made their mark (for example, arts funding platform AngelShares is still a bit short of projects, and Scottish social site SoLoco never quite got going) but generally speaking, Kickstarter arriving here need not be the death knell for the UK’s home-grown sites. Though it may not feel it for the platforms, and the UK is not short of creatives wanting to take their great ideas to a wider audience.

Looking across existing platforms, there are also some pretty interesting ideas for pushing the crowdfunding model further:-

  • Launchpad (Rockethub) – RocketHub have started working with high-profile brands (e.g. Gibson guitars) to create unique opportunities for creatives to gain new skills and publicise their work. As I understand it, there is preferential access for individuals who have crowdfunded with RocketHub – and teaming up with exciting brands to offer further development opportunities to successful crowdfunders (who, remember, have already taken the first steps towards cultivating a fanbase) could be a really strong incentive to get people into crowdfunding and encouraging them to work hard to make their campaign succeed.
  • Curated areas/ partnerships (Kickstarter and others) – As I’ve already mentioned with WeFund’s work with Edinburgh Fringe, I reckon this is a really fertile area for growth. There are so many possible themes that platforms could go for  – for example, Rockethub are going for something a bit different with their SciFund; while the success of ‘curated communities’ depend heavily on the energy of the curator (as we found when we tried this in Derby and Brighton, with mixed results), they offer an excellent opportunity to target specified communities of interest, and could be pretty exciting.
  • Sponsored surveys (Spot.Us) – Journalism crowdfunder Spot.Us [LINK] used to offer funding ‘credits’ that users could earn in return for taking part in sponsored surveys, which could be put towards projects on Spot.Us. This was a great way of putting corporate sponsorship in the hands of site users, while at the same time delivering meaningful interaction between user and sponsors that met the participating sponsors/ brands’ objectives.  It’d be great to see more of this.
  • Rewarding repeat funders – Repeat donations are the lifeblood of any successful platform, and a vital challenge for any platform is to prompt users to visit new projects and make repeated donations. RocketHub are doing this by awarding funders bronze, silver and gold badges (displayed on each funder’s profile) in return for repeat donations and interactions. Very Olympic indeed.
  • Meetups/ events – we found through our ‘arts club’ events that funders valued the opportunity to meet the creatives and learn more about crowdfunding, increasing their loyalty to the platform and projects. Meetup could be an interesting tool to do this, particularly with potential project leaders – but there are many other ways to try offline interaction with funders and projects, making crowdfunding feel a bit more ‘real’.

What do you reckon? I’d be interested in other suggestions to make our existing platforms continue to grow, as well as your view on what will be the impact of Kickstarter’s arrival. Comment below or post links to your blog, and let’s get a conversation going.

Crowdfunding for everyone: what ‘big’ funders can do

Adrian Hon’s excellent article earlier this year talked about current slightly awkward juxtaposition of public funders and the crowdfunding movement. I agree with the pitch Adrian makes for a hybrid public/ crowd funding ecology, and believe passionately that ‘big’ funders could do much, much more to help crowdfunding really become a way of life for creative and social organisations here.

I’m amazed that we haven’t seen more from big funders to reward those who have crowdfunded successfully already. Granted, it’s great that NESTA are getting behind a few platforms as part of the Innovation in Giving fund, but I reckon there are a few other local-cost and no-cost things that public bodies could do to help make crowdfunding really popular here:-

  1. Encourage a significant media organisation to run a ‘crowdfunding campaign of the month’ segment, perhaps co-produced with NESTA (with NESTA selecting the best campaign each month). The example of the Observer ‘new radicals’ supplement was a good example of what NESTA can do here.
  2. Encourage other public funders (e.g. Arts Council) to establish schemes only open to projects who have part-funded their work through crowdfunding, and establish experiments to direct ‘match-fund’ public and crowdfunding on individual projects and groups of projects (CrowdCulture in Sweden are a great example of this). In a similar fashion, public funders and think-tanks could easily establish their own ‘launchpad’ along similar lines to RocketHub’s, by working with brands and larger organisations to identify new opportunities to grow successful projects even faster.
  3. Identify and showcase best practice in crowd-fundraising training. We think that the most effective way to increase the success rate of crowdfunding projects across platforms may well be to increase the capacity and capability of individual fundraisers, and encourage project leaders to think of themselves as fundraisers. My WeDidThis co-founder Hen Norton is already doing some of this, as she describes in her blog– and she’s not the only one!

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Who wants to own a startup?

What you can now stand to get in return for crowdfunding a startup

Being someone with a slightly more than a passing interest in the world of crowdfunding, I popped along to NESTA last week for the launch of ‘The Venture Crowd’, a new research report into equity crowdfunding. Do have a look, it’s worth a browse – and mercifully, compared to most social research it’s pretty concise and to-the-point. Which is nice.

I’m going to blog next week on what NESTA and other similar organisations could do to boost demand for non-equity crowdfunding (in short: a lot more), but for now here’s some thoughts on the new kid on the block:-

What it is

If crowdfunding was the next big thing in 2010-11 (with NESTA estimating that $1.5bn was raised for crowdfunding projects in 2011 alone), then equity crowdfunding is making a strong case to follow suit for 2012-13. The concept is pretty simple – take the concept of getting lots of people to give a little bit of money to help make your project happen, and instead of offering them kooky rewards (like your name weaved into the side of a bus) you offer them a stake in your company. If your business idea takes off, your backers- from £10 upwards – get a share of the return. The vast majority of equity offered in this space so far has been non-voting, so if you’re a crowd-investor you’d have to sit tight and cross your fingers to hope your company does well.

To date, equity crowdfunding platforms have been thin on the ground, given the complexity of navigating financial regulation. For once, the UK is out in front here, with Crowdcube launching just over a year ago (Check out their excellent infographic on their first year’s work, where they raised over £2.8m raised for 15 fully funded pitches), but with the passing of the JOBS Act in the US – which among other things lifts the majority of regulatory burden for companies seeking to raise money from a large number of small investments – expect to see an explosion of new platforms any minute. The UK market is starting to form too, with Seedrs, winner of the recent London Web Summit launched only last week, trumpeting the fact that it is fully authorized by the UK authorities.

Who it’s for
It’s way too early to tell what sort of businesses might stand the best chance of success in trying to crowdsource startup capital – judging by Crowdcube, most seem to be consumer-facing brands seeking to sell a product or service to the general public, starting with a new bubble bath manufacturer. Soon-to-launch CrowdMission is aiming to try something a bit different, with a focus on social and sustainable businesses, rather than naked profiteering. This is an interesting proposition: while there’s no question that projects with a social purpose dominate the non-equity stakes (so with the right pitches the platform should be able to get ‘normal’ people excited about investing) – and I reckon non-equity finance for social businesses could still turn out to be a game-changing proposition – will micro-investors really be motivated by returns that are surely smaller than for-profit competitors? And if so, is it truly a more attractive proposition to offer non-voting equity with a tiny return, compared to a really exciting non-financial reward?

Which brings me on to (imho) the great unanswered question – who do these new platforms want as their ‘crowd’? Is this a play for genuinely new micro-investors, or simply a way of getting existing angel investor communities to put their cash elsewhere (so, something like FundingCircle)?

 This is a question that occupied much of our time when we ran WeDidThis, and was where NESTA’s session last Tuesday got interesting – when pushed on the question, answers ranged from angel investor Ami Shpiro’s view that this would complement offers for existing big investors (who do need “somewhere to go“, and a crowdfunding platform would be as good as anywhere) to CrowdMission founder Karen Darby’s more emotive “people like my Mum“. And lots inbetween.

 This is an important question, because it helps us start to understand how big the market could be for this form of funding. It may be that an initial base of bigger, traditional investors create a critical mass that helps popularise this for new micro-investors. But for now, I’m not quite sure – for instance, although Crowdcube’s statistics suggest that they are a crowd of small investors, I’m not sure that’s the full story. Their average donation size is up at around £1.9k, which seems quite a lot for ‘cold’ investors. As a comparison, for my site WeDidThis our equivalent was about £30, and although I’d expect there to be a fair disparity between the two sites, to know that this is really pulling in the masses, it’d be great to see this number come down a bit over time.


A typical CrowdCube pitch

Why I’m excited 

In theory, equity crowdfunding is absolutely brilliant:

  • It makes the process of seeking finance totally open (and, with luck, fun) and makes startup executives think about building broad word of mouth support from the word go. Which can be a really powerful tool in making new companies grow faster.
  • It enables everyone to participate and benefit from the growth of UK startups. Getting involved with making new companies grow is really exciting, but so far is the preserve only of a small number of dragons. Equity crowdfunding can change this, creating a whole new class of micro-investors.
  • For startups, the option of going to the crowd for capital could be a useful (if labour-intensive) way to bridge the gap between very early-stage loans and grants, and going for bigger investment (and ultimately listed company status).

Why I’m wary
However, equity crowdfunding is a very different proposition to backing a Kickstarter project and I’m really not sure we’ve fully bottomed this out. Here are a few of the concerns lurking in the back of my mind:-

  • How to balance encouraging new investors and warning them about the risks – As this blog sets out much more eloquently than I could, we are talking about very high-risk equity here. That’s not to say that buying it isn’t fun. Just that you shouldn’t bank on getting your money back. (And to be fair to CrowdCube and Seedrs, they are very clear about this). The JOBS Act takes an interesting approach to this, limiting the amount that non-accredited investors can invest in equity crowdfunding – subject to much lighter regulation than traditional investment – to 2% of their income, up to $10,000.
  • But go too far on investor protection and you risk putting off casual investors (who are surely the target market for this). For example, while I’m really excited about what Seedrs will do and think the team look great, I found registering to become an investor with them a somewhat burdensome process – I went through two long questionnaires, downloaded a 26-page contract had to agree to the statement below, and then had to send in copies of my passport and driving licence:-

Although you will be able to invest a minimum of £10 in any given business through the Seedrs platform, we strongly advise you to build a highly diversified portfolio. You should therefore plan to invest no less than £1,000 in aggregate if you are going to invest through the platform at all.”

Is amassing a £1,000 highly diversified portfolio really ‘crowdfunding’ as we’ve come to understand it? I’m not so sure….

  • Governance/ vetting risk – It’s taken 2 years for the first case of a high-profile crowdfunding fraud, which is not bad going, all told. Given the massive volume of projects going through Kickstarter, that’s not a bad rate, and when you’re talking about a site that mainly takes small donations (nb not investments), most people seem to be happy with the general success of Kickstarter’s self-policing policy. However, turn small donations into slightly larger investments and things change. Although Darren Westlake from CrowdCube has been pretty candid about rejecting lots of pitches coming his way, I do think we need to keep talking about how platforms can help their users get to know the companies pitching for their cash.
  • Getting the offer right – As Jeff Lynn, Seedrs’ founder, said at the NESTA session, this sort of funding offers financial and social return wrapped together, so investors are likely to tolerate lower financial return. All well and good. However, although I can well understand why startups would be reluctant to gain a crowd of voting shareholders (at such a low entry point), it’d be great to see companies start to get a bit more innovative about how they enable their crowd-investors involved in growth of the company they are investing in.

In conclusion, there is a hell of a lot to be excited about here – but to make this a truly inclusive movement, I think platforms will need to find innovative ways of helping their users discover and get to know the companies pitching for support, cultivating a user offer that makes very small equity investing a valuable and fun experiece for the micro-investor, while being super-clear on the risks.

But if we can get all that right, this could make capitalism very interesting indeed. And it could help quite a few smashing startups get off the ground.

Check back next week for more on how we can make everyone into crowdfunders, including reaction to Kickstarter’s announcement that they’re coming to the UK…..


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The RSA- awakening the sleeping Fellowship giant

   An excellent example from the RSA Animate series

About 5 years ago a friend at the Civil Service invited me to join the RSA – an acronym which nowadays unfolds to the rather less pithy ‘The Royal Society for the promotion of arts, manufacturing and commerce’ – a membership organization with a glittering history dedicated to improving society through social policy and action, including:-

  • A formidable programme of talks and lectures, available online here, including the trailblazing RSA Animate series;
  • An Academy, putting theory into educational practice;
  • Fascinating hands-on research and social action projects;
  • A smashing central London space, currently undergoing a massive refit.

All of this is part-funded by its 27,000 Fellowship base, who in turn drive their own activity and networks in support of the Society’s aims. Although subject to a nomination and approval process, anyone can become a Fellow (and do get in touch if you’re interested).

Amazing, right?

Well, nearly.

In the five years since I joined, I’ve experienced the RSA treading a slightly confusing and hard-to-navigate path between its many identities; part-think tank, part social action hub, part membership organisation. The work it does is brilliant and the RSA’s officers are excellent, and I’ve enjoyed the talks (particularly the RSA Animate series), been to few meetings of the RSA social enterprise network, and spent plenty of time meeting Fellows and the central team at RSA House – but I feel that all of this great stuff does obscure the fact that a more effective relationship with and between Fellows would enable the Society to make an even bigger difference to the UK and the world.

It’s not just me saying this. When I was getting together the nominations to run for the Fellowship Council* I was disappointed to find that a number of friends had recently resigned their Fellowship- saying that as all of the things they valued the RSA for were offered for free to anyone and it wasn’t clear what else the organisation offered its Fellows, why would they pay the approx £100 annual subscription?

And they had a point.

While being part of the RSA Fellowship is not quite the same as buying a private product or service (i.e. Fellows’ subscriptions subsidise the Society’s general work, including making things like the RSA lectures available for free), my worry is that the message of the RSA is either not clearly defined or is not getting through, meaning that it’s not achieving its mission as magnificently as it might.

For me, the RSA is a great example of the huge opportunities, and the equally intimidating challenges, in getting people behind social organisations. I don’t want to be one of those people who extolls the virtue of private over public in all spheres, but as I’ve mentioned in previous posts, many private companies would kill to have as many ‘fans’ as the RSA has amassed and would be bolder in prompting them to act in support of their brand or product. Again, this is not to denigrate what the current team is doing, or to say that this is easy. It’s hard. But it’s such a great possibility.

And if you think that this is all a bit parochial, stop to think about how valuable a 27,000-strong user base would be to a social startup seeking to build a following behind its mission. There are, put simply, so many social startups doing great work for whom the RSA Fellowship could be a transformational friend.

So, here’s what I’d do to try and awaken this sleeping giant. I freely admit that these may already be on someone’s to-do list at RSA House – but from the point of view of a relatively active Fellow, if that is the case, the message hasn’t yet got through:-

  1. Use existing web platforms to personalise the RSA’s offer to Fellows, starting with new Fellows, and using data from other social networks better. Private companies draw on their user’s existing consumption habits (indeed, Facebook’s entire commercial strategy seems to be driven off opening up its users ‘likes’ to interested brands). We need to understand better what Fellows want from the RSA, and match them to the projects, discussions and initiatives that would deliver for them. This could also involve looking at greater integration of the online RSA Fellowship with existing platforms, including Facebook and social (like, about which I’ll be saying more soon).
  2. Give Fellows’ blogging a louder voice – In May, I wrote a short blog for RSA Comment (linked below). There was 3 weeks from submission to publication, and by the time it came out I felt pretty detatched from the article and wasn’t keen to share. RSA Comment has some terrific content, but wouldn’t it be great if we let go of some of the central control and gave Fellows had a more open platform to blog (around the Society’s mission and themes of course), with the most-read/ shared/ commented stories getting prominence on the RSA social meda feed and ultimately in the RSA Journal?
  3. Crowdfund the RSA’s Fellows-led Catalyst projects to make them go further and get more Fellows behind them –  I had a go at this with WeDidThis, with mixed success but a lot of learning, and would be keen to help this happen more and better in future. I’ve blogged about at greater length here.
  4. Increase opportunities for Fellows to drive Projects led by the central team – there’s a wealth of talent and experience in the Fellowship, which could be much more directly employed to drive forward RSA Projects. As a starter (and apologies if this is happening already but I haven’t yet seen it) why not invite Fellows to sit on the boards of each Project strand (subject to interview, and matching their skills and expertise with the project of course)?
  5. Set some public, accountable targets for Fellow engagement  – you know the ’50 people are talking about this’ that you see on every Facebook fan page? Well, it’d be great to have something just as open to drive the RSA’s engagement with and between the Fellowship – how many new Fellows do we want, and what are our targets for their involvement?

As you can see, I’m writing for both RSA Fellows and non-Fellows- I’d really welcome comments from both. If you’re a Fellow already, what do you reckon – does this make sense, or am I barking up a set of wrong trees? If you’re not, what do you think about the RSA – would you join?

* My candidate statement’s here – have a look, and if you’re already a Fellow, please vote for me!
To give you an example of the work funded by the Catalyst fund, here’s a project that was part-funded through my old site and Catalyst. We need more of this!


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Of bridges and fences- aka Why I’m Blogging


For a year and a half (until March this year), I had the pleasure of starting and running a website, raising funds for the arts. I’m going to blog a bit about my experience later- including why it worked, why we merged with a competitor, and what mistakes I’ll try not to make again- but suffice to say I met a bunch of people and organisations who I think are doing great things, and I want to use this blog to discuss what they and others can do to grasp what I believe is a pivotal moment.

Put simply, I think that we’re seeing a really exciting convergence of innovation and consumer demand at a time of great social need, creating new ways of giving people power to solve big problems. I’m fascinated by the opportunity that technology creates to bring increasingly connected global communities together, and am not sure that we’ve fully understood yet what can happen when we do so.

But why ‘bridges and fences’? Well, the title for this blog comes from a beguilingly simple phrase I spotted in ‘The World of Goods’, a book by Mary Douglas and Baron Isherwood setting out an intruiging defence of moral ‘consumerism’ (have a look at a free excerpt here– thanks to Google books):-

“Goods are neutral, their uses are social; they can be used as fences or bridges.”

Though writing in the distant past of 1979, Douglas and Isherwood make a point which I think resonates ever more loudly today. For those weaned on social media, we can see every day how the quality and quantity of social connections that a brand or campaign can generate is at the heart of its success, with brands seeking to build ever-more intimate ‘conversations’ with their fans, and advertisers desperately chasing the gold dust of peer-to-peer recommendations, retweets, and likes.  Products and services describe themselves in terms of the value they will add to their consumers’ lives- or the degree that they will meet their consumers’ aspirations  (have a look at this list of company slogans for a smattering of examples). And the openness and accessibility of the modern innovation process  – as I found out when I managed to start a web business off savings from a meagre few years in the public sector- means that the consumer has more power to innovate on their own behalf than ever before (and for more on this, check out Charlie Ledbetter’s excellent TED talk).

Socially orientated businesses have a killer head-start here – their very purpose is to inspire their consumers (and supporters) to be ‘better people’ and participate in realising a shared social goal, either by undertaking direct social action, or something more indirect like philanthropic giving. Social enterprises are by definition better aligned with their consumers’ aspirations- as both are principally concerned with achieving their social mission- in contrast to companies who exist to solely deliver value to their shareholders.

So where are these social game-changers, and if they are so well geared to making our lives better through connection to social good, why aren’t they everywhere already?

This is the point of this blog- to seek out those people, companies and movements that can be true bridges and bridge-builders, connecting concerned and hopeful user communities with inspirational leaders and movements who have the ideas to make a big difference. Got any suggestions? Comment below and I’ll have a look!

And later this week I’m going to start with the RSA, and a few thoughts about how they could energise its 27,000-strong membership base…. More soon!


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My RSA blog

While I’m away, have a read of my RSA Comment blog on crowdfunding. I’ll be writing a lot about this sort of thing in the future (among other themes)- do let me know what you think!

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