Crowdfunding: Turning Great Ideas Into Reality

Last week I was fortunate enough to be a guest of Bing Lee and Canon for an Olympic “One Year to Go” fundraising event, to help our athletes make their way to London next year for the 2012 Olympics. It was a high profile, first class event. The NSW Premier was in attendance, as were other local and international dignitaries. Every table had a representative past Olympian to host the night. The fundraising, which involved auctioning off signed flags, an electric car, and Olympic event packages, raised around half a million dollars that evening, which was then matched by our State Premier.

It was a fun night out, and it’s great to get behind the dreams of our nation’s best athletes, but it didn’t compare to the personal satisfaction of a much smaller scale fundraising activity for a band that I’m very much a fan of.

I’ve been following the album releases of a band called Fear Factory ever since they unleashed their first album, Soul of a New Machine, back in the early 90′s. I’ve loved most of their material since their debut, and a lot has to do with the unique vocalisations of its singer, Burton C. Bell. Fear Factory ushered in a new style of metal that many bands have been emulating ever since.

However, success does not always result in complete artistic or financial freedom. One of Burton’s side project bands is called City of Fire, and they released their debut two years ago, to positive reviews and reasonable record sales. However, when it came to following up with their second album offering this year, they simply didn’t have the support to make it into the studio and produce an album.

Through friends and contacts, Burton and his band members heard about Pledge Music, a site that hooks up bands with their supporter base to raise money for a variety of causes – the two biggest ones being charities supported by performers, or in City of Fire’s case, to ask fans to help fund studio time to produce the new album.

I personally heard about the City of Fire fundraising activity through the General Manager of Roadrunner Canada, where City of Fire is based. I registered with Pledge Music to see how it worked and what I could do in terms of my own contribution.

Pledge Music helps bands gain purchase commitments to their album upfront. In this particular activity, for the small “pledge” of $10, you would get a digital copy of the album once it’s completed, $12 would get you a CD copy, and $15 a signed CD copy. Paying for the album upfront secures the funding because there is already enough committed interest to justify the production expenses.

Beyond the music, bands are able to offer other enhanced and sometimes personalised products and services for a larger pledge. For $2,500, City of Fire will come to you and play at your very own house party. For $150, you get the privilege of photographing the band at one of their concerts. Taking gig photos  was one experience I would have put money up for, except that it was limited to their local area, in this case Canada.

I ended up pledging $150 for a handwritten, signed copy of the lyrics to the first single off the new album. I must admit, I am a fan boy, and can’t wait for my personal piece of metal memorabilia.

Within two weeks of posting their project on Pledge Music, City of Fire had enough pledges to finance some studio time and produce their new album, and has in fact continued to gain support beyond the initial required funding. This is where it gets interesting for anyone involved. When I received an email from Pledge Music advising that the funding target had been reached, I really felt personally attached to that milestone, and had my own mini-celebration. That emotional connection, particularly when it comes to artistic endeavours, is a powerful motivator.

This concept, commonly known as crowdfunding, is a funding model that has evolved and grown with the internet’s reach and scale. Crowdfunding is not limited to performers who want to produce a new work of art. One of the most famous examples of crowdfunding is the Tik Tok and Luna Tik project. This project, which was initially posted on Kickstarter, offered an accessory that converted the current iPod Nano into a wearable watch. The activity required $15,000 to fund the initial production, and the project ended up with funding (and therefore sales) of close to a million dollars. Not every project will achieve the same level of success, but it illustrates the power of going public with your idea and being able to commercialise it with the help of people who believe in your initiative.

Whether it’s a technology, sports or music venture, crowdfunding is a financing tool that shouldn’t be underestimated. Whether you’re an artist, an inventor or an entrepreneur, if your idea has potential, seeking the support of like-minded individuals through Kickstarter, Pledge Music and many other networks may just take your dream from the drawing board and into the hands of people all over the world.

Have you been part of a crowdfunding project? What pointers would you give to anyone considering this type of publicly generated funding?