A diverse range of funders are now using matched crowdfunding as a new way to raise money and support for new ideas and projects. In 2016 alone, crowdfunded projects received more than £1 million in matched funding. This figure is set to rise substantially in 2017.
Despite the rising interest and growth, until now there was little evidence on the financial and non-financial impacts of matched crowdfunding, and there had been no match funds that focus specifically on the arts or heritage sectors in the UK to date.
In order to address this lack of evidence, a pilot programme between the Department for Digital, Culture, Media and Sport, Heritage Lottery Fund, Arts Council England and Nesta set up two funds for arts and heritage projects, providing £251,500 in match funding for crowdfunded arts and heritage projects.
In total, 59 projects were funded through the pilot with support from 4,970 backers. Through surveys of backers and project owners, alongside analysis of crowdfunding platform data, this study looks at the financial and non-financial impact of match funding as a new means of getting projects off the ground.
A report setting out the findings from the pilot programme has now been published:
- Matched crowdfunding can help leverage additional funds. The £251,500 in match funding provided by Arts Council England and Heritage Lottery Fund as part of the pilot helped leverage an additional £405,941 from the crowd of 4,970 backers.
- The pilot largely attracted new supporters and finance for arts and heritage organisations, rather than drawing from existing philanthropic sources.
- Matched crowdfunding goes beyond increasing financial contributions. 85% of fundraisers reported receiving non-financial contributions such as voluntary work offers and campaign design advice.
- Crowdfunding improves skill levels for individuals and organisations: More than two in three fundraisers reported that running the crowdfunding campaign significantly improved their pitching and fundraising skills.
- While crowdfunding can help fundraisers easily attract a global audience, in the majority of cases backers live less than 20 miles from the project they supported and the majority stated that they were going to see or experience the project in person.
- While matched crowdfunding attracts a diverse mix of backers in terms of age, education and average income, it risks being dominated by a few large donors, with the top 1% of backers giving 24% of the total crowd contribution.
This information was obtained from the Nesta website.