A closer look at these money-raising strategies
Fundraising has existed for years, and is known as the way to raise money for a worthy cause. The appeal of fundraising comes from the fact that it enables people to contribute to a charity or cause they believe in, for as long as there has ever been a need to make other people’s lives better. Furthermore, fundraising has traditionally been the means by which individuals and organizations alike are able to address societal concerns such as slavery, child labor, domestic violence, human empowerment, homelessness, as well as political campaigns and entrepreneurial agendas. .
Crowdfunding stems from fundraising, but with a twist. Crowdfunding harnesses the power of groups of individuals or a community to kickstart a cause or project and initiate its success. Crowdfunding allows anyone to put their projects “out there” where potential supporters are then able to mull over the validity of the endeavor. These potential supporters then decide to contribute to the project or not, without the guilt that traditional fundraising comes with. Causes can range from the launching of a band’s album to the travel expenses of a photographer who wants to document different locales of the world. In other words, crowdfunding is available to everyone. It can be said that crowdfunding’s purpose is to acquire financial support for a project geared towards the arts, business or simply making other people’s lives better in exchange for a token gift and that warm fuzzy feeling. Crowdfunding taps the pool of supporters that are interested in and believe in the projects seeking financial backing. .
Another difference between fundraising and crowdfunding is that the latter is seen as a temporary and time specific endeavor – its purpose is for short-term projects, such as the publication of an author’s novel, or support for an artists’ exhibit. With fundraising, support can be long-term, and in fact, often is. There are several types of fundraising activities, which can consist of annual donations, capital campaigns, or donations spread out evenly over time. Donors for fundraising can be repeat or one-time donors, and are also traditionally sent notifications, newsletters, and annual reports.
Crowdfunding is also seen as having evolved through the Internet and other means of digital communication whereas ‘formal’ fundraising takes a more direct approach such as gathering finances from individuals, business organizations, charities or applying for financial grants and other special financial solicitations. Crowdfunding is said to eliminate the need for awkward face-to-face interactions where the potential donor ends up feeling ‘guilty’ if they don’t contribute that many in the public are wary of. Crowdfunding’s agenda is more casual and informal, and is facilitated heavily by word online (through social media networks, online communities, websites, and fundraising portals).
With all these differences, however, crowdfunding and fundraising can actually be said to be merging. The lines that formerly divided the seem to be fading as two fundraising efforts are moving to the Internet, and non-profit organizations have their own email or online campaigns, while crowdfunding websites continue to grow at a steady pace .
In essence, however, crowdfunding and fundraising are the same. They have the same ideals – that is, to get support (financially or otherwise) for projects that certain individuals or groups believe in.