Government-Matched Crowdfunding: Sweden, Australia and the UK
A look at three government-matched crowdfunding programs.
Sweden
- Name of initiative: Crowdculture
- Type of initiative: Crowdfunding platform for cultural projects (television programs, videogames, digital/interactive productions)
- Developed by: Fabel Kommunikation
- Funding partners: The Foundation of Innovative Culture (part of the funding portfolio of the City of Stockholm) and Vinnova (Sweden’s innovation agency)
- Country: Sweden
- Launched: 2011, still in operation
- Source of funds: Several Swedish regional funds (9 out of a total 21) invest as “institutional members” to the tune of 1% to 5% of their cultural budget, while individual investors contribute private funds.
- Amount of funding per project: Between 10,000 SEK ($1,500) and 45,000 SEK ($7,000)
How are Crowdculture projects funded?
When they upload their project to the site, creators must establish a specific objective, i.e., an amount of money to be raised within a maximum 120-day timeframe. Like many other crowdfunding platforms, projects must reach this target in order to be able to draw on the funds received. If they fall short, the monies involved are redistributed to other cultural projects on Crowdculture.
Crowdculture’s stroke of genius lies in the innovative way it brings together individual investors and state funds. For one, this gives everyone the opportunity to support the project of their choice through private donations. For another, it serves as a portal for redistributing public funds from regional cultural budgets, using a voting system that favours projects with the highest level of public support.
Each fund can determine its own project eligibility criteria. For example, a fund can select a geographical region where it wishes to promote cultural production or a specific content format or type, such as documentaries with an environmental theme. Creators apply the same criteria to submit a project to Crowdculture. Using these “tags,” the platform then matches up complementary projects and funds.
Companies or individuals can start up a private investment fund using their own contribution, to which their partners then add their investments. These funds must also set out eligibility criteria for potential recipients.
Creators have a degree of flexibility when it comes to the type of funding allocated to their project. They can, if they so choose, opt to decline public funding and accept donations only from individual investors.
Granting of public funds
Members of the public can vote for their favourite projects and/or make direct donations. Each project is given a weighted popularity ranking based on budget size. Public funds are then invested in the projects that have met their fundraising target through a mix of private investments and public votes.
Successful Crowdculture projects adhere in every respect to the principles of crowdfunding. Projects that achieve their established objective by the end of the 120-day timeframe are the ones that receive the donations made by the public and investment funds.
Crowdculture is a hybrid system that provides an “à la carte” approach to funding cultural projects, by linking sources of funding together and submitting projects to members of the platform for their verdict.
A new model in regional cultural development
Crowdculture takes a unique approach to the funding of smaller cultural industries, by making it possible to link what the general public wants to how state funds are allocated to cultural projects. In addition, by providing members with the opportunity to establish their own investment funds, Crowdculture is positioning itself as a new form of philanthropic giving and cultural patronage.
The official figures show that half of the 400 projects submitted have received funding, thereby giving the next generation of creators a showcase for their talents and an opportunity to access hard-to-find funds for their first projects.
Australia
- Name of initiative: Match Lab
- Type of initiative: Crowdfunding platform for artists
- Developed by: Australian Cultural Fund (ACF)
- Funding partners: Creative Partnerships Australia
- Country: Australia
- Amount of funding per project: Up to AUD 10,000 as well as an invitation to a two-day intensive fundraising and arts business clinic.
In Australia, MATCH Lab is an initiative by the government-created Australian Cultural Fund (ACF) is a fundraising platform for Australian artists. It is managed by Creative Partnerships Australia to encourage donations to the arts.
Artists first apply, and, if successful, attend a “Raising Money for Your Art” clinic, to develop a strategic plan and design a fundraising campaign.
As with a typical donation-based crowdfunding approach, artists upload their project, start their fundraising campaign and invite supporters to donate. It is not an “all-or-nothing” platform.
Donations over AUD 2 are tax deductible through the ACF.
Creative Partnerships will give the project a boost by matching dollar-for-dollar (up to AUD10,000) what the artist raises during the campaign.
The program therefore combines attributes of tax-deductible charitable giving, with crowdfunding and the added advantage of public funds to match privately-raised funds.
United Kingdom
- Name of initiative: Crowdfund the arts and Crowdfund for heritage
- Type of initiative: Crowdfund the arts seeks to support individual UK-based artists and arts organisations while Crowdfund for heritage is available for not-for-profit organisations and aims to support community assets and celebrate local culture.
- Developed by: Crowdfunder and Nesta
- Funding partners: The Arts Council England and Heritage Lottery Fund, supported by the UK Department for Culture, Media & Sport.
- Amount of funding per project: extra funding up to £20,000 is available for 50% of a project’s total.
The UK’s Nesta has partnered with Crowdfunder to launch a pilot matched crowdfunding (“matchfunding”) initiative aimed at artists and arts and heritage organizations.
Interested participants must use the Crowdfunder platform to raise at least 25% of their total project costs, from at least five different backers. Projects also need to be raising a minimum of £4,000 and they have to reach at least 100% of their target.
Crowdfunder will then top up or “match” the crowdfunded amount with up to £20,000. Artists must therefore apply to demonstrate previous artistic achievements; how their project will allow artists to develop and/or pursue a new opportunity; and how the project will benefit as wide an audience as possible.
Total funding available through this pilot is £125,000.
Because the project is a pilot, Nesta will be evaluating it to determine how these projects compare with typical grant-funded projects; the impacts of the funding and the potential leverage that the matching achieves.
