My Musings on Crowdfunding
The crowd is an interesting thing. This summer I started working at a company that organizes and manages crowdsourced work. But hold on, let me go back a step and think about my first interaction with the crowd. If I had to point to one instance, I might incorrectly jump to the time when I applied to my summer internship. I hadn't given it much thought, and I would imagine most people might not give it a second thought either. However, I'm curious for a few reasons:
- Services like crowdsourcing and crowdfunding still seem to be foreign concepts to many people despite the fact that the term "crowdsourcing" has been around since Jeff Howe first used the term in Wired's "The Rise of Crowdsourcing" in June of 2006 (https://web.archive.org/web/20110816122756/http://www.wired.com/wired/archive/14.06/crowds.html);
- Shouldn't people be more excited about playing a part in causes, especially since being a part of the "crowd" diffuses contributions more than other forms of participation (e.g. fundraising); and
- Technology allows the "crowd" to connect faster and more seamlessly than ever before, so it should be a breeze.
Going back further in my interactions with crowdsourcing, I jump to the time that I was running for student government in college. I decided early on that I did not want to use paper flyers, but that left me few options. I knew I had to go viral, so I focused on an email campaign, a Facebook group, Facebook ads, and word-of-mouth. What I did not realize at the time was that all of those were crowdsourcing (in a way). Afterall, that is what any viral campaign is, right? A viral campaign is largely carried out by the crowd, your followers. I was thrilled to see email threads come back to me on lists that I hadn't emailed. People I didn't even know were carrying my message, "Go Green. Vote for Dean!", but that still wasn't my earliest interaction with crowdsourcing...
Halloween. Yep. "Halloween?!?" you might be asking yourself, but before you run off, let me explain myself. Have you ever passed candy out at your house and asked the trick-or-treaters which pieces of the candy they wanted? My parents asked if I wanted to hand out candy one year, and I remember being promised that I could have the leftover candy. I was eager to help fill pumpkin bowls, cauldrons, and all sorts of Halloween bags so that I could see what I would get to keep at the end of the night. To my disappointment, all of the good stuff was gone first (lesson learned). Now that I think about it, the trick-or-treaters, many of whom I had never met before, had sorted the candy into two categories: 1. the most desirable pieces, and 2. the leftovers. I had successfully crowdsourced what pieces of candy were the most popular in my neighborhood. Yay me!
That's all fine, but how does it relate to crowdsourcing today. I had only had interactions with crowds the size of a college and a neighborhood, or two. The crowds that are accessible today over the internet are significantly larger. So much larger, in fact, that crowdsourcing companies, like CrowdFlower, can tap into over 1.5 million on-demand workers at any one time. That's roughly the population of Phoenix (AZ), San Antonio (TX), or San Diego (CA). Wow! Can you imagine living in one of those cities and being able to survey all of them instantly? How about ask them for a dollar each? You would be a MILLIONAIRE. There is so much the crowd can do that we don't even realize, just as I did not realize that I was crowdsourcing that one Halloween.
So what are the implications? Probably the most interesting aspect of the crowd is that it is largely anonymous, unless you can claim to know 1.5 million people personally at any given time online. You can get opinions from across the globe, thousands of impressions, or collect those funds your project needs more quickly than ever before. If crowdsourcing relied upon going to only people you knew personally, you will have exhausted all of your contacts quickly. Another great aspect about the crowd is that it's on the internets, interwebs, or whatever you like to call them, which makes the crowd instantaneously available for tasks (say, if you need to send a job to India), or funding (if you are particularly savvy at reaching across the globe for contributions). What a small world we live in afterall.
Now that I have taken you on a very brief tour of crowdsourcing, I want to explore crowdfunding with you for a second. I mentioned that having access to the crowd diffuses individuals' contributions in order to reach a larger goal. A great analogy comes in the form of ants. Love 'em or hate 'em, they still come together to make the perfect team. They want to build "X," and together it's easy. However, alone they must each carry more of the burden. That's remarkable! It isn't rocket science, but it can be difficult to grasp the reality of the situation. Maybe people are less likely to take their credit card out for small donations, or they like to go all-or-nothing. I think that second possibility is the more interesting explanation of the two because it shows why there needs to be a paradigm shift.
Where do we go from here? Well, I can't claim to be an expert, but I do feel that as crowd-based solutions continue to emerge people need to think about their crowd-role in a fundamentally different way. For the same reason that some fundraising campaigns have probably failed to attract many small donors in the past, crowdfunding needs to overcome a hurdle. People need to feel comfortable giving just a little bit because others just like them think that someone else might come along and foot the bill instead. I could go on a whole tangent into free-riding, but it's at least important to note that it fuels this all-or-nothing mentality. We need to switch from thinking that "Oh, well, it's just a small amount" to "If I contribute, then so many more people will, too." That may be a tad bit optimistic, and seem like my head is in the clouds, but when you're part of a crowd, your actions are amplified by the people around you.
I look forward to hearing from you, oh, wise crowd!