Crowdfunding campaigns usually take place on an online platform, with the nonprofit soliciting small donations from a large number of people to fund a specific project rather than just the overall mission of an organization. They’re a relatively new form of fundraising and are increasingly popular, but the rules around what donors and nonprofits should expect are still being formed.
Last year, David J. Neff, Digital Engagement Strategist, PwC, and Miriam Kagan, Senior Fundraising Principal, Kimbia, “crowdsourced” the crowdfunding “donors’ bill of rights” – what donors can and should expect from crowdfunding campaigns.
Now, Neff and Kagan are turning the tables and asking the nonprofit community: What rights are nonprofits entitled and to what responsibilities should they adhere when hosting a crowdfunding campaign?
At the Nonprofit Technology Conference and SXSW Interactive, Neff and Kagan received lots of feedback and ideas from nonprofits as to what they believe their rights and responsibilities were. Now they’re asking you to comment.
Please review this draft of the Nonprofits’ Crowdfunding Bill or Rights and add your edits and suggestions to the COMMENTS section below, before April 30, after which we will publish a final version. Thank you.
NONPROFITS’ CROWDFUNDING BILL OF RIGHTS – DRAFT
1) Transparency is the responsibility of all three parties. Nonprofits, platforms providers (if the nonprofit is using a third party platform) and the general public. This includes the fundraising costs (when appropriate), risks associated with the project (if applicable), timelines and all parties involved in the project.
2) Nonprofits are required to have full campaign transparency as funding progresses and fulfill perks (if offered) in a timely manner , in alignment with the platform providers (if using third party) perk fulfillment guidelines.
3) Nonprofits should clarify upfront or develop a process for communication post campaign fund allocation (or refund), should project goal not be met, project objectives change or realign.
4) The data privacy, tracking, and marketing rules should reflect the general organization policy on data tracking and privacy, or otherwise be clearly disclosed.
5) Platforms are responsible to let nonprofits know who’s using the platform for their benefit and platforms are required to let nonprofits fix issues (wrong logo, mission statement, etc). There should be a process for the nonprofit to request a funder be removed if he/she is not in alignment for nonprofit mission, infringing on mission/brand, etc.
6) Individual nonprofits are required to list out how these crowdfunding designated funds will be used if funding is raised above and beyond the stated goal. It is the nonprofits’, not the platforms’, responsibility, to ensure designated crowdfunding campaigns set up by nonprofits comply with designated funding regulations and reporting requirements.
7) Platforms should offer nonprofits clear, timely, and accessible campaign analysis and reporting during and post campaign
8) The platform should allow nonprofits to reach campaign and donors directly with post campaign follow up messages, etc.