A friend recently returned to the UK from Portugal. After two years searching, she had finally found her dream plot, but to bring her permaculture project to life, she was forced to work until she could afford to fund it. It's not an uncommon tale, but what other options are there?
It's not a popular word at the moment, so I'm going to say it quickly... banks. Good ones like The Co-operative and Triodos remain one source of ethical investment, but as we know, now is not the easiest time to secure a loan. When I failed to secure a grant for my own project, I turned to an alternative finance model which has permaculture principles at its core: crowdfunding.
What is Crowdfunding?
Crowdfunding does what it says on the tin: it employs the power of the crowd to help meet a funding target – rather than asking for the full investment from one party. Pioneered by Kickstarter.com in the US three years ago, the model is traditionally used for projects with a meaningful goal.
First, develop a crowd of supporters in advance, by talking to people about your vision. Then, publish a video pitch on your chosen crowdfunding platform, set a target and a length for your campaign, and encourage your supporters to each invest a small amount, to help you reach your target before the deadline.
You can create support (or a 'buy-in') to your vision by offering project-relevant, low cost or experiential 'rewards' to potential backers. For example, FoodCycle, a UK charity that uses surplus food to provide nutritious meals for people at risk from food poverty, offered backers who pledged £20 to its campaign on Peoplefund.it a cooking lesson if it met its £5,000 funding target. Similarly, for my own project, I hope to create ambassadors, by giving backers branded, organic cotton T-shirts in return for their contribution.
Steven Hawkes, FoodCycle's communications and fund-raising officer, explains: "Twenty years ago, I have no idea how you'd have got funding for some of these projects, but now if someone has an amazing enough idea (and can pitch it in the right way), they can get ordinary people to invest a few pounds and make it happen. It's also a low cost, low risk way of testing your idea."
Most crowdfunding websites won't charge you for hosting a video pitch and only take their 4-9% commission if you hit your funding goal. Most work to an 'all or nothing' model, meaning that if you don't fulfil (or exceed) your funding target, none of your backers pay a penny. This has the added advantage that, if your project doesn't have sufficient support, you have the option not to proceed. As for the commission, you are advised to calculate the fee in advance and add it on to the total amount you need to raise.
Calculating Your Rewards
You need to work out how much it will cost to provide backers with their rewards, plus postage and packing, and add that to your target too. You may find that, for example, by buying T-shirts in bulk, you can get a good deal, but it's also worth talking to local suppliers who may be willing to donate their services if you explain to them what you are trying to achieve.
By utilising the former for my own campaign, the cost of supplying one printed T-shirt should be around 20% of the pledge given. That may sound like a fair proportion is deducted, but it's worth reminding your supporters that, unlike many charity donations, there are no middlemen, meaning they can pledge in good faith that the majority of their money will go towards funding your project. The backers will also have the option to decline their reward, allowing a bigger chunk of their pledge to go towards helping you meet your goal.
Andrew Denham, founder of The Bicycle Academy, an inspirational frame building school in Frome, successfully crowdfunded £40,000 start-up capital in just five days. He attracted support for his idea of creating a standardised bicycle frame that could be used by communities in Africa, with each student donating the first bicycle they make. He argues the importance of planning realistic rewards:
"For one campaign I saw, you had to spend £200 to get a loaf of bread delivered. The campaign owner was assuming that people are doing it purely for philanthropic reasons, when actually – although there is an element of that – they want something fair and tangible in return.
"I've looked at a lot of campaigns and the ones that are successful – bar none – are the ones that give people a great deal, something they wouldn't be able to get for that price elsewhere."
Promoting Your Campaign
Of course, for people to invest at all, you have to get them excited about your project. That starts with an engaging video pitch, as filmmaker Robert Stern explains. He raised over $40,000 (£25,000) to produce music documentary The Ukes Down Under through Indiegogo.com earlier this year:
"Your campaign video is critical and should sell yourself as much as your project. You have to convince funders, not only that it is a worthy cause, but that you are capable and trustworthy enough to deliver what you promise."
Creating a buzz early on in your campaign is another essential way of proving your credibility. The more pledges you get, the more convinced potential backers will feel about your project (and the more worried they'll become about missing out), which will attract further pledges. A great project with only £10 invested after the first week is going to look suspicious and deter new backers, even if it's really credible. It's crucial to promote your campaign widely from before your launch, and a good place to begin is with the people you already know.
Charlie Jones recently launched his project on WeTheTrees.com – a new niche crowdfunding platform especially for permaculture projects – and surpassed his $3,500 (approximately £2,200) target to fund the recording of an album of educational and entertaining permaculture songs. He said:
"The first people to donate to my project were friends, and people who had already heard about the project through my previous work in the community. If you do have local support, try to encourage people to donate to the campaign via the crowdfunding website, as you need to reach your goal in order to be eligible for the funding."
Christian Shearer, founder of WeTheTrees, concurs: "We definitely recommend sharing your campaign on your social networks, sending out emails, and embedding your campaign into a blog or two, but also get out and talk to people.
"Share your campaign with friends and family, and let people know about it at your next local permaculture gathering. The more energy and spirit you bring to your promotion, the more likely you are to meet your goal and bring your ideas to reality."
Using social media is a particularly powerful way of curating your campaign, allowing you to create momentum by posting updates, such as how much money you still need to raise, and also to thank people as they show their support. Steven Hawkes learnt this only too well when after five weeks FoodCycle had only hit 20% of its target, and he turned to the company's (then) 2,500 Twitter followers for support.
"We were on £1,000 with five days left," he says. "So we rewrote the page, and made a new video. We added new rewards and used Twitter to spread the word. We tweeted people and got it retweeted around the globe, and over those five days we made about £4,000 and hit our target."
It just goes to show that, with crowdfunding, it's not over until it's over. But when it is over, if your campaign was successful, it might just be the start of something. It doesn't matter whether you're trying to start an inoculated mushroom business or raise the money to pay for your first permaculture course, crowdfunding offers a solution to bring your dreams to life.
PM's Top Tips for a Successful Crowdfunding Campaign
Crowdfunding is in no way the quick or 'easy option' and requires months of strategic planning before you launch. Talk to people about your idea, run focus groups (or set up a Facebook group online), and build an engaged and excited community in advance, so you can hit the ground running when your campaign launches. Getting your video pitch right is crucial, so make it professional, with good visuals and audio.
Be Prepared to Commit
Don't underestimate how long the planning will take. You may think you have it sorted, but you need to constantly peer review your idea, and know when to adapt to your community and when to stand your ground. Once you launch, you need to make yourself available 24:7, answer every email and phone call efficiently, and generate press for your campaign. If you have a full-time job, take those weeks off.
Be Generous With Your Rewards
Everybody's tight on cash at the moment, so you need to give people a real incentive to pledge. A great cause is not enough: put yourself in your donors' shoes and ask yourself whether your rewards would convince you to invest. If you're even slightly unsure, be more generous. It needs to be a no-brainer for them to click 'donate'. Plus, the better your incentives, the more likely they are to pledge higher.
For people to give you their money, you need to make them trust you. Answer every question honestly and patiently, and don't try to pull the wool over anybody's eyes. The other power of the crowd is that someone will find you out! Talk to your backers like you would your friends, be open about what you need the money for, and don't be afraid to share your weaknesses – one of them might just offer to help you out!
Keep It Short
When your campaign goes live, if you've marketed it well, there'll be an initial shot of pledges. These then tail off, before a second peak towards the end of your campaign, from all the people who fear missing out. If you let your campaign run too long, you risk losing momentum. The perfect length depends entirely on the project and how much you need to raise, but aim for weeks rather than months.
PM’s Top 5 Crowdfunding Platforms for Permaculture Projects
The first crowdfunding website exclusively for permaculture projects, WeTheTrees was started by permaculture design (PDC) teacher Christian Shearer and accepts pitches from $100 (£60).
With a vast ‘environment’ section, Indiegogo has no vetting process, allowing the power of the crowd to judge each project’s promise. The only platform to offer ‘flexi-funding’, it may suit projects that can make a start even if they don’t raise all the money they need.
The sister website to respected equity-based platform Crowdcube, Crowdfunder will host projects for up to 60 days. Donors are asked to pay Paypal or Go-Cardless’ fees on top of their pledge, ensuring the majority of their contribution goes towards your project.
With a dedicated ‘green’ section, Sponsume accepts pitches for £200 or more and charges 4% commission on every successfully-funded project. With a highly-engaged, artistic community, it is well suited to projects with fun, creative or radical missions.
Started by Kiva-founder Michael Norton OBE, Buzzbnk is the only crowdfunding platform to allow backers to pledge their time as well as (or instead of) their money. It aims to unite social ventures with the people who can help bring their projects to life.
Featured Crowdfunding Projects
Alternative Sources of Finance
The Co-op Enterprise Hub (UK)
The Permaculture Credit Union (US)
Community Development Finance Institutions (UK)
Polden-Puckham Charitable Foundation (UK)
Zidisha (Burkina Faso, Indonesia, Kenya and Senegal)
Georgina-Kate Adams is a freelance journalist. She is currently running her own crowdfunding campaign, The Seed Africa, to fund an educational scholarship for a girl in Swaziland.
For more information, see www.theseedafrica.com