Discover assoconnect Request a demo

Crowdfunding for Nonprofits

Crowdfunding is a form of fundraising that is very popular for nonprofits, artists, and startups because it depends on support from a community.This form might be better for some nonprofits, instead of depending on other funding sources such as large donations from a handful of philanthropists or foundation grants.

Public funding for the arts has dropped recently, so crowdfunding has been a great way of empowering the larger community to support causes that they believe in. Even donations of $5 or $10 can be powerful when you have a huge group of supporters chipping in to helping your nonprofit!

On the agenda for this article:

Let's explore how to use the crowdfunding model for your nonprofit!

crowdfunding-for-nonprofits-launch

When to Launch a Crowdfunding Campaign

You should plan well in advance, because all fundraising campaigns work best when you build in enough time!

Depending on the crowdfunding platform you choose to use, you may need to go through some steps first. For example, you might need to provide documents to prove that you are a nonprofit.

Then, it'll take some time to approve your project proposal. To reach your fundraising goal, you have enough time to reach out to your potential supporters.

In general, fundraising campaigns are often launched a couple months or even a year before the project or initiative that you are fundraising for.

As far as the duration of your campaign, this will depend on the amount you’re aiming for and whether you will be actively calling and emailing your supporters.

It may be difficult to collect $50,000 in two weeks. 

On the other hand, raising $500 over the course of 6 months may tire your supporters out or undermine the credibility of your project.

It is important to know that a long campaign is not necessarily more successful. Some platforms place a maximum length to crowdfund -- usually 2 months. 

 

crowdfunding-for-nonprofits-amount

What Amount Should Your Nonprofit Crowdfund?

This is a very important question to consider.

Some crowdfunding platforms operate on an all-or-nothing basis, which means that the funds will not be paid out unless your objective is reached.

Therefore, your budget should be as transparent as possible! Your donors will want to know exactly how their donation will be used! 

You should also make sure you include the operational costs linked to delivering the project! Consider whether you need to include shipping, buffer time, and staff hours for the budget. 

crowdfunding-for-nonprofits-budget

Choose a Crowdfunding Platform

There are two different types of crowdfunding for nonprofits:

  • Donation-based. This is the simplest way to fundraise. People donate to an individual or organization. 
  • Reward-based. Donors receive rewards based on the amount donated. 

Depending on your organization’s needs, you should ask yourself these questions to determine which crowdfunding platform is best:

  • Is the platform adapted to the nature of my project? Are other fundraising projects on the platform similar to mine? Are organizations like yours (arts, startups, or public health) also using it?
  • Does the platform help promote fundraisers to its users? Or are fundraiser organizers solely responsible for increasing visibility?
  • Is there a fee to use the platform?
  • What happens if the goal amount is not reached? Can you still receive the amount that was raised?

A popular crowdfunding platform is GoFundMe, a donation-based platform. You can fundraise as an individual on behalf of a nonprofit organization. GoFundMe displays how much is raised in real time, which is really useful! 

If you are fundraising for a creative project that has a “deliverable” product, such as an album, film, game, book, or item, Kickstarter is well-known for crowdfunding. You can create donor perks for increasing donation levels. This will encourage donors to bump up their donated amount, by offering exclusive benefits. 

Read on for more information on offering donor perks!

crowdfunding-for-nonprofits-platforms

What Perks to Offer for Your Nonprofit’s Crowdfunding Campaign?

One aspect of crowdfunding that is similar to existing membership or donor models is that some organizations offer some “perks” to donors supporting the nonprofit.

Keep in mind that how you offer perks to donors who donate at different amounts: $5, $10, $20, $50, $100, $500, or more than $1,000+! 

You will want to set up an incrementally increasing number of perks, so that donors are enticed to donate more in order to receive exclusive benefits or access. 

The higher amount the donor gives, the more “VIP” (very important person) treatment they should receive!

Some examples of great donor perks include: 

  • Exclusive event for donors only
  • Swag with nonprofit logo (tote bags, T-shirts, and reusable water bottles) 
  • Early access to ticket sales or webinars

Just be sure you’re offering perks that you know your nonprofit can deliver! You should confirm that the perks are inexpensive, but will add appreciation to the donors.

Let’s say you offer an exclusive VIP party for your donors. However, the cost of renting a venue, paying for food and drinks, and hiring staff to work the event is actually worth the same or more than the amount you received from all the VIP donors. This is a classic case of not planning ahead for all costs, and weighing the donations against delivering perks! 

crowdfunding-for-nonprofits-compelling

How to Present a Compelling Story

The more human-centered and transparent you are in the crowdfunding proposal, the more you will maximize its attractiveness to prospective donors.

When you’re brainstorming how to create a compelling story, consider how your nonprofit began, why the nonprofit is unique in its mission, and what to show as its track record of accomplishments. 

Tell your nonprofit's "story" so that potential donors want to support your nonprofit's mission! Feel free to add photos, short videos, and infographics that really catch attention.

crowdfunding-for-nonprofits-mobilize

Mobilize Your Community

Start by mobilizing friends and family members who are closest to you. This is how they’ll be inspired to donate, because they know how important it is to you!

After mobilizing your first circle, the second circle (the acquaintances of your friends and family) will also be interested. This will create the buzz that might even inspire the third circle to also donate to the crowdfunding campaign. 

Sometimes, for smaller fundraising goals, mobilizing the first circle is enough. Get your contact lists together!

Feel free to segment your community by whether they already know your organization, whether they have attended an event before, or used to be a donor, in order to personalize your messages and present your project in the most favorable light.

crowdfunding-for-nonprofits-fundraisingCrowdfunding is a great fundraising plan for you, if you want to add an opportunity for your community to feel ownership of the cause and contribute to the success of the organization.

However, as discussed in this article, your budget and operations must be carefully worked out in order to be as transparent as possible with your donors.

Then, you just have to choose the platform that is best adapted to your needs. 

Ready to begin crowdfunding?

Need more tips on nonprofit management? AssoConnect is trusted by 15,000+ nonprofits to help with daily administrative tasks. 

Sign up today for your 30-day free trial!

Request a demo