Following the crowd?: Crowdfunding books
Crowdfunding is flavor of the month, but is it a long-term answer to publisher and bookshop funding models? Lucy Stewart reports.
A phenomenon that began as a way to fund band tours and albums has spread rapidly across other industries. Crowdfunding (also known as micro-philanthropy) is attracting increasing numbers of creative entrepreneurs and organisations who are using it to finance their ideas and projects, sometimes at very early stages. Campaigns are created using an online platform such as Pozible.com or Kickstarter.com, and publicised via social media.
In Australia, successful examples in the literary world (using Pozible) include the newly created Queensland Literary Awards, which raised $29,312 (goal: $20,000) towards prize money and administration costs. The Emerging Writers Festival raised $4055 (goal: $4000) to take its digital writers roadshow to Brisbane. Creative writing journal Visible Ink raised $1025 (goal: $1000) for its 2011 edition. Author Kate Toon raised $2901 (goal: $1000) to self-publish a book of poems Gone Dotty. The Red Room Company, an organisation that commissions new Australian poetry, is trying to raise $5000 to publish 60 new works linked to an app described as a ‘poetic map of the entire country’. Editor Irma Gold raised $5,105 (goal: $5000) towards a shortfall in the print costs of The Invisible Thread, an anthology of 100 years of writing by Canberra writers, as well as to pay a filmmaker to film interviews with the authors and for authors events. New Zealand screenwriter Mark Staufer achieved a huge $75,000 target (via Kickstarter) for a hybrid book/film project called The Numinous Place, which will be released as an ebook and app in December.
In each example, the individual or organisation created a profile on a crowdfunding website with a description of the project and often, a short, personal video. A fundraising goal and a time limit was set (up to 90 days for Pozible campaigns and up to 60 days for Kickstarter campaigns). Generally incentives were offered in return for donations—contributors of a certain amount, for example, received an invitation to an exclusive magazine launch or an early-release copy of a book.
To crowdfund or not to crowdfund?
As well as raising cash, crowdfunding can help to build an engaged audience for a product or service, or in the case of a risky venture, gauge demand for it. While at this stage there are no tax deduction benefits for donors, the Australia Council believes crowdfunding has the potential to significantly increase individual funding to the arts.
With this in mind, the Australia Council’s crowdfunding experts Elliot Bledsloe and Caroline Vu recently toured Australia to run a series of seminars for arts practitioners. The sessions were designed to improve the industry’s understanding and skills, thereby helping to increase the number of successful future campaigns.
Fullers Hobart’s events manager Rachel Edwards attended one of the Australia Council sessions and came away enthused about the potential of crowdfunding to help the book industry. For bookstores in particular, she believes it could be used to fund author visits in an environment where booksellers and publishers have less money to spend on events. ‘Crowdfunding is a perfect opportunity to engage your community and customer base. It gives people ownership over an author’s visit, which leads to much more involvement.’
However, campaigners do need to be prepared to work hard at promoting their campaigns. Jessica Barlow is using Pozible to raise funds for ‘The Brainwash Project’, which aims to create a prototype magazine that will help convince major players in women’s magazines to stop digitally altering the appearance of models. Her biggest challenge: ‘You have to keep your social media going all the time. Everything has to be linked: your Facebook, Twitter, etc. You really have to keep that going for people to stay interested in your campaign.’ At the time of writing the project has raised $4526 (goal $4000) with more than a month left until the project’s deadline. Barlow says most of her contributions have come from strangers.
Zoe Dattner, general manger of SPUNC, says ‘To be honest, I’m not a massive fan of the crowdfunding model. I think it is overused and before too long it’s possible that we’ll get “crowdfunding fatigue” where the projects themselves are undervalued by the fact that they’re crowdfunding projects. This is because the first we hear about them is when they’re asking for money, as opposed to showing us what they are and why we should care, and there’s an inherent neediness to that.
‘There are exceptions to this, and I’ve seen some really good proposals. But by and large I think a lot of the projects could benefit from being approached from a purely business perspective (and no doubt many do), and be successful that way. I think the model works when the projects are very community-based and there is an obvious benefit to multiple stakeholders/ audiences/participants/communities. But for publishing companies who are running businesses, I am dubious. That’s a lot of effort going into raising the money, and a lot riding on whether or not that money comes in. There are a lot of other factors that require a lot of attention—like distribution—in successfully publishing a book and publishers need to focus on that.’
One new business model that incorporates crowdfunding principles but benefits multiple stakeholders is Dutch website TenPages.com. Founded in 2010, TenPages offers a platform for aspiring writers to upload manuscripts and seek financial support leading to publication. Authors publish at least the first 10 pages of their manuscript, then visitors to the site may purchase one of 2000 ‘shares’ of the book, offered at €5 (A$6.20) each. If all the shares are sold within the prescribed time of four months, one of the affiliated publishing houses will contract the writer and provide an editor to guide the author in completing the manuscript. Of the money raised, €1000 (A$1240) goes to the author as an advance, and the remaining amount of €9000 (A$11,157) is used by the publishing house to edit, publish and promote the book.
Post-publication, writers receive standard royalties. Investors are rewarded by receiving 10% of total sale profits and a mention in the book. If the full shares of that particular book are not sold, investors receive €4 of their investment back. The major benefit for publishers is that the initial publication costs are covered by the ‘shareholders’ who are also likely to act as ‘ambassadors’ for the book. Tenpages has become a highly successful business, and the website has plans to expand internationally.
In times when traditional publishing and bookselling models are in flux, perhaps examples such as this point to how crowdfunding principles may have a place in business models of the future.
1. Crowdfunding platforms are platforms, not money trees
2. You need to be on Facebook
3. You need videos
4. Cost your project properly
5. Get as much insight as you can.
Source: Artery, published by the Australia Council
Sydney digital publishing consultant and blogger Anna Maguire has written a book called Crowdfund it! It’s the first title from digital-first publishing start-up Editia, run by Charlotte Harper. The book focuses on 12 of the highest profile crowdfunding platforms, including Kickstarter, Pozible and ArtistShare and features interviews with successful campaigners. The book provides international accessibility details for all platforms, and covers creative projects as well as causes, social entrepreneurship, microfinance and business equity. Read more information on the book here.