In RoboCop, a cyborg cop saves Detroit from evil corporations.
In reality, the 1987 movie helped destroy the reputation of that fine city, casting it as a bleak, crime-infested hellhole.
But through the power of crowd funding, Detroit will now likely get a public statue of RoboCop.
For all the good it does collecting money for victims of tsunamis and such, online fundraising has its drawbacks. Whenever large, anonymous crowds decide anything, there’s a danger it will be ill-considered. Just replace the word “crowd” with “raving mob” and you get the sort of connotations I’m referring to.
But there are many, many examples of fan-funded successes.
In late October, Priya Panda sent out a mass email with the subject line “Help me out PLEASE and I’ll help you out.”
It was a plea for money so her band, local metal group Diemonds, could pay for the recording of their sophomore album before a U.S. and European tour this month. The “I’ll help you out” part was the release of the album.
By the start of January, Diemonds had raised more than $5,000 and paid for the recording of their album. They received donations of as much as $500 per person.
The site that made all this possible is Kickstarter, the New York-based fundraising phenomenon. Make a short video about your project and let amateur philanthropists chip in.
It works. Kickstarter has successfully funded more than 1,000 projects, including the DIY social network Diaspora* and a comic book by musician Daniel Johnston.
Toronto-based rock band Rural Alberta Advantage produced a vinyl 7-inch using the $6,700 they raised through Kickstarter, which included $3,000 from a single person – this even after the band had been signed.
This all makes sense for recipients of the crowd’s money. There was an opportunity, and they took it. Fair play.
But consider the downside, like the $65,000 raised on Kickstarter for an awful RoboCop statue for a troubled city that could seriously use the money for better things. Crowds, dare I say, can be wrong.
Furthermore, I’d argue that Kickstarter is a poor model for fundraising.
It takes the business model for internet start-ups and applies it to every other project. Even when it doesn’t make sense.
For example, getting a start-up investment doesn’t work for a band. Seed money for bands, unlike businesses, is a one-time investment the money does nothing to build long-lasting success. It’s giving someone a trout rather than teaching him how to fish.
At most, Kickstarter helps in making one album, a single product. Then what? Even Oasis needed more than one album to make a career. Nothing about one-time funding is sustainable.
Kickstarter founder Perry Chen, who appeared at last year’s NXNE Interactive, intended the site for one-off projects that bring a single idea to fruition. In building a web business, a company makes a product, like a social network or app, and that initial investment works wonders to get the mechanics of a business underway.
But in creative fields, a single idea is not enough. What happens if you have to come up with another? Where do you go – a different crowd-funding site? How long till the crowd starts to wonder where their investment went?
Historically, bands have cut their teeth on live shows, battling it out in clubs. This experience forms engaging, innovative musicians – a kind of seasoning that simply cannot come from one-time dump of charity by generous fans. Throwing money around is not the solution.
But that’s exactly what crowd-funding is: blindly directing cash toward a popular project, with no return on investment needed. When no one considers the outcome, money continues to flow, even when it won’t help in the long run.
joshuae@nowtoronto.com
