Crowdfunding is for everyone. Anyone can campaign for funds and anyone can contribute. While many consumer product crowdfunding campaigns find success through pre-orders of products at costs above what many can afford, entire communities can rally around crowdfunding campaigns that provide tangible community benefits. Smaller individual contributions within a broad base of support in close-knit and densely populated areas have the potential for tremendous success. We see this taking place effectively when communities create co-operative businesses “Co-Ops” and link with anchor institutionssuch as universities, hospitals, and cultural centers to address community needs.
One example of an anchor institutions in poor community is in Northwest Philadelphia, where community development financing and a land lease by La Salle University recently helped to bring a community its first full service supermarket in forty years. The supermarket now anchors an 80,000 square foot retail center called The Shoppes at La Salle. 98% of supermarket workers live in Philadelphia, and more than ⅔ are from Northwest Philly. By its very nature as an anchor institution, the supermarket is a space for the community to build a new economy around.
Crowdfunding comes into play when communities come together with an anchor institution around a common goal, like access to a supermarket. With strong leadership, capital gained through crowdfunding can multiply through matching grants from larger organizations. Beyond matching grants, the level of demonstrated community interest is quantified and monetized through crowdfunding campaigns, which often amplify community engagement through social media.
We feel that the greatest strength of crowdfunding is and will be the harnessing of community-based capital to create what a community needs. This may be human capital in the form of pledged volunteer hours. It may be social capital in the form of momentum, awareness, and goodwill generated by the campaign. Very tangibly, it should also manifest itself in financial capital. Even if the amount of financial capital raised is small, the fact that a community is willing to put cash on the line for what matters to them will carry a lot of weight with the larger institutions coming to the table to help fund what is necessary. The beauty of crowdfunding is that it harnesses and raises all these forms of capital in one campaign.
If you have seen successful examples of this working in your neighborhood, we want to hear from you. Contact us to share your story. For more information on the use of community-based capital in economic development projects, check out what our friends are doing at the New Economics Institute.