Crowd financing is an innovative business model, it is raising funds from those in your network to finance your business, it is the power of the crowd to help achieve your aspirations, it is raise money in an efficient manner through the fans and the community. Above all, crowd sourcing is more and more a glimpse on a new economy initiated by what we have learned to call web2.0.

I remember some 3 or 4 year ago when there was a general fear of internet been transformed in a expression of ‘conservative business and commerce’, the main stream values, that ‘kind of television’ that assume the crowds are a swallower of bad quality. This pressure still exists, see the secret lobbys from the media industry around the ACTA.
Even in accessing the issue of pirate downloads, this new economy has positive things to do compensating the negative of ACTA and old media industries:
Biracy is an indie film project launched at the beginning of last month with the goal to convert download pirates into investors, creators, and distributors by using a persuasive crowdfunding /crowdsourcing hybrid business model. It’s quite innovative in that the filmmakers have allocated 32% of membership income towards an upfront referral reward system, meaning that members can potentially earn money before the film has even been made.

It so exciting this glimpse peer to peer economies gives on a future where media monopolies and other big money industry owners don’t have the power to dictate what I want where they wont be able to keep on pushing me values, images and products I don’t care about.

The initiatives may sound to many like microfinancing, or possibilities to raises limited amount of money. This is not true. As an example, The Age of Stupid. a documentary project on global warming has raised over $1.2 million via crowd funding, and also used crowd sourcing to distribute and exhibit it around the world.
http://www.mymilliondollarmovie.com/ My Million Dollar Movie. This project is still in funding stage, but it is notable that it has so far raised $942,520 towards the goal.

More and more people are believing and investing in crowdfinancing. Trampoline Systems, the London-based social analytics business, is using an unconventional approach to finance its growth. Instead of raising money from venture capital firms Trampoline is “crowdfunding” the business, raising small stakes from a large group of investors.

Introducing Trampoline Systems from Trampoline Systems on Vimeo.

Because this whole concept really gets my heart and mind, here a compilation of links about crowd financing.

• http://www.rockethub.com/projects
• Fundable is a service allowing for the creation and management of fundable “group action” pages where pledges can be accepted. If a campaign does not reach its goal within a set time (14 or 25 days), then all pledges are negated and no money distributed.
  Kickstarter is a New York start-up that helps other projects raise small amounts of finance through crowdfunding.
• Create A Fund allows both individuals and organizations to collect money online. The site tightly integrates with services like PayPal and Facebook to ensure a cohesive donor experience from start-to-finish. Fund creators get customizable ‘Donation Pages’ where donors can keep tabs on a fund’s progress, leave comments and invite others.

Crowd funding in the film industry

• Artemis Eternal – Upcoming sci-fi short film being produced independently by Jessica Mae Stover. The user is invited, via the web, to donate (from $1 to $100) and join “The Wingmen” (whose members hail from students to homemakers to NASA employees and filmmakers) and help to crowdfund the project.
• A Swarm of Angels is a project to utilize a swarm of subscribers (Angels) to help fund, make, contribute, and distribute a feature film using the internet and digital technologies. It aims to recruit earlier development community members with the right expertise into paid project members, film crew, and production staff. I wrote about this project sometime ago (in portuguese)
• “The Cosmonaut” is a feature film in which members of the public are invited from to become a “producer” with a minimum investment of €2. The project is licensed under Creative Commons’ Attribution-Sharealike so anybody can edit, remix, copy and freely distribute all the film materials which the creators have committed to publish in unedited HD.
• http://www.indiegogo.com/is an online social marketplace connecting filmmakers and fans to finance independent films. The platform provides filmmakers with tools for project funding, recruiting, and promotion; while enabling the audience to discover and connect directly with filmmakers and the causes they support. Since launching at the Sundance Festival in 2008 several projects have been financed through the platform.

Other industries

• Spot.Us is non-profit pioneering community-funded journalism. Journalists pitch stories on the website which are then selected and financed through crowdfunding.

• Blender Foundation is a beautifull story of an Amsterdam-based venture that develops widely-used 3D animation software. Having started life as a commercial venture Blender raised €100,000 through a crowdfunding process and switched to an open source model.

• Cameesa is the first site breaking into ‘Crowdfunding Fashion,’ where it encourages participation in the clothing creation process. Members decide which designs to print on T-shirts by supporting them financially. Once a design is 100% funded, the members who supported the design get a special edition of the t-shirt and earn a revenue share each time that design is purchased.

Crowd funding in the music industry

• SellaBand is a service for musicians and bands to promote their work in an effort to gain “believers” who will help to fund the production and distribution of an album. Believers must raise $50,000 in order to graduate the artists into contractual agreements. Believers can earn money back from ad revenue used in tandem with giving away the music for free online at sellaband’s site.
• Bandstocks provides a financial model for artists seeking an alternative to major labels. Funds for production and promotion are raised through “band stocks” purchased by fans in £10 units. Investors receive a copy of the album plus royalties from sales. Patrick Wolf is the most prominent artist to use the platform to date, raising £100,000 to release his album “The Bachelor” after leaving his contract with Polydor.
• ArtistShare is a service for musicians to fund their projects outside the normal recording industry. It utilises micropayments to allow the general public to directly finance, and in some cases gain access to extra material from an artist. In 2004 Maria Schneider became the first artist to win a Grammy with an album distributed exclusively over the Internet. Distributed through ArtistShare she received four nominations for her album Concert in the Garden and won Best Large Jazz Ensemble Album.

non profit

• First Giving is a service that allows fundraisers to create online person-to-person fundraising pages for any US non-profit. The funds are directly transferred to the non-profit which differentiates firstgiving from other services.
• PledgeBank while not exclusively for funding has often been used to crowdfund for projects and charities.