Crowdsourced Philanthropy: How Do We Measure The Impact of the Crowd?

Beth KanterAuthor and blogger
Posted: December 17, 2010 02:44 PM

I read George Weiner's excellent post about some of the pitfalls with crowdsourced philanthropy. I agree with him on many points, but I think there are different models and designs out there beyond the Vote for Me crowdsourcing approaches he describes.

Over the past two years, as part of my work as Visiting Scholar for nonprofits and social media at the David and Lucile Packard Foundation, I have had the opportunity to participate in (NNF), a community of practice for funders who are intentionally investing in and working through networks. The focus has been to develop practice and share insights on networked effectiveness. I've had the pleasure working with Diana Scearce, from Monitor Institute, who has been facilitating and weaving this network.

There are several learning cohort groups, including one on better understanding network impact. Recently, I presented a high level overview of crowdsourcing, including examples from the lens of funding and doing. It was good opportunity for me to look back at the crowdsourcing chapter in our book,
The Networked Nonprofit, and update the examples and thinking. The presentation was followed by a discussion about how one might evaluate efforts to engage crowds.

Crowdsourcing is defined broadly as the process of organizing many people to participate in a joint project, often in small ways. The results are greater than an individual or organization could accomplish alone. There are four different models of crowdsourcing, There's isn't one best way to do it -- and many organizations use a combination of these models to meet their objectives.


(1) Creating Collective Knowledge or Wisdom

A group of individuals has more knowledge for solving a problem than any single individual. Collective intelligence creates a quilt of knowledge that many people can distribute.

Public Insight Network in Minnesota is a network of 75,000 people who help make Minnesota Public Radio News by sharing their observations, insights, and experiences with reporters and editors who may share these insights through a story or on the website. The measures of impact for this project include diversity, deeper and more relevant reporting, and better connection with listeners.

Maine Health Access Foundation did an experiment on Facebook, including it in its channel to promote a funding opportunity but also posted the initial letters of inquiry on their Facebook page to get feedback. The measure of impact is to determine whether the comments and feedback strengthened or improved the final proposal.

Crowdsourcing for knowledge creation can include "mashups of data."
Ushahidi is an open source platform that facilitates crowdsourcing through the use of SMS/cellphones and online mapping. It has been used in disaster relief, for example, in Pakistan, and other scenarios from London Tube strike to election monitoring to mapping crime incidents Atlanta.

(2) Crowd Creation

Crowds create original works of knowledge or art.
The Royal Opera used Twitter to crowdsource a new opera. They encouraged Twitter users to send suggestions for the plot. The opera staff collected the suggestions and summarized them on their blog. Opera is not the only art form, there's been crowdsourced choreography And, a symphony orchestra, made headlines when they crowdsourced musician auditions for the Youtube Symphony orchestra.

How do you measure the impact of the crowd here? Does being engaged in the creation of the work spur more appreciation for the art form and hopefully attention and participation? Does crowdsourced creativity reach a different (younger) and new audience segment? While it is probably difficult to absolutely prove cause and effect, implementing a crowd artistic creation requires a discussion about letting go of control or at least being explicit about how creative contributions will be accepted or curated or added to the work. Do you accept everything or is there curation?

(3) Crowd Voting

The crowd votes, rates, or gives feedback and tips on ideas, products, places, and even people. Internet platforms make it is easy for crowds to vote, rate, and provide feedback. Think Yelp, eBay, or Amazon.

Crowd voting and choosing based on popular vote has been used in Cause Marketing. There has been an explosion of "Vote for Me" contests that have become contests in techniques for vote getting and inspired cause fatigue at worst. At their best, they spread the awareness of a commercial brand and provide an opportunity for small nonprofits that don't typically receive large amounts of funding to win dollars.

Crowd sourced philanthropy, on the other hand, does not typically select the best idea or project to fund by popular vote. Many foundations have taken a hybrid approach, acknowledging a role and place for expertise in addressing a "wicked problem" or spurring innovation. Hybrids include a mix of openness and curated decision-making by experts.

How to structure crowd sourced philanthropy based on voting or feedback depends on the outcomes of the project, a theory of change. The Knight Foundation's News Challenge, Case Foundation's Make It Your Own awards, and Island Collaboration Fund are examples of the hybrid process and linked to a clear theory of change. Key in the implementation is being clear and transparent about how funding decisions will be awarded. An impact question is -- "How innovative are the ideas as a result of using a crowdsourcing process?"

Voting, rating, and feedback crowdsourcing projects have applications beyond philanthropy and marketing. It can help organizations make a traditionally closed process more transparent and ultimately improve the level of feedback. Conferences have taken this approach to shaping their agenda. NTEN used a hybrid crowdsourcing approach to solicit panel proposals for its NTC 2011, similar in design and approach to the method SXSW has used. Looking at impact is a question of how the crowdsourcing broadened the diversity panelists and topics as well as how this approach increase awareness and registrations for the conference. And, reaping that value also depends on using an efficient way to crowdsource the decision.

Brooklyn Museum implemented a crowdsourced photography exhibit experiment called " Click! A Crowd-Curated Exhibition." Using a hybrid approach, there was an open call for photographs that attracted 389 entries. The entries were ranked by 3,444 people, including both general public, museum goers, and expert curators. You can compare the ratings by level of expertise. One of the surprises, was that the average amount of time that people looked at the online images was 22 seconds -- compared to in-person in exhibit studies that found 6 seconds. Measuring impact is how did the crowdsourcing process attract a more diverse selection of art works, but also how it might have encouraged more people to appreciate the works.

Next Step Design is an experiment in "Crowdsourcing Public Participation in Transit Planning." Traditionally, government agencies ask for public input on planning projects by holding open meetings and workshops. The purpose of this project was to get this public input in a different way: online. Did the use of crowdsourcing enable them to get more and more in-depth feedback compared to the traditional method? Was it more efficient?

(4) Crowd Funding

This category taps the collective purse, encouraging groups to fund an effort that benefits many people. The idea is to leverage the funds of the crowd to complete a project they support. For the funders side, we looked at the America's Giving Challenge from the Case Foundation. Impact measures not only looking at the total amount raised, but also the adoption of new online social fundraising tools which was a key objective.

There are a variety of platforms for crowd funding, including Causes, Crowdrise,
Razoo, GiveZooks and
others.

A big takeaway for me was that you have to very clear and intentional about what you want the crowd to do and your design has to facilitate the crowd's work as efficiently as possible. A lot has to do with the technology platforms and how well it automates some of the crowdsourcing work flow. If you're crowdsourcing funding decisions, you have to be very clear and intentional about funding decisions are made and ensure that your design is really leveraging your intended your outcomes.

What you think?


Follow Beth Kanter on Twitter: www.twitter.com/kanter


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Tapping the crowd for start-up funding

A start-up investment model developed by SA entrepreneur Eve Dmochowska (pictured) and her colleagues to solve key problems in SA start-up financing proved a big hit at the annual South by South West (SxSW) Interactive festival held in Austin, Texas earlier this week. Dan Oshinsky, a reporter for a local news station, described her as one of the best presenters he had seen at SxSW, alongside such luminaries as Clay Shirky and Marc Cuban.

The idea she presented, CrowdFunding, will obtain investment in R1 000 blocks from individuals, and raise R1m for its first fund. It is structured as a trust, which resolves a number of regulatory issues around investments and soliciting funds from the public.

The idea was launched almost by accident. When the news leaked out of a small preview circle, the pledges began streaming in, with 254 investors offering R842 000 in just the first two weeks. This was well ahead of her expectations, which was that R1m might take three or four months to raise.

Dmochowska’s panel was one of two talks involving South Africans on the packed SxSW programme, with panellists Heather Ford, who currently studies at Berkeley, Justin Spratt, the co-founder of start-up incubator ISLabs, Brett Haggard, technology journalist and podcaster, and Gareth Knight, an experienced start-up founder with business interests in SA and the UK.

The goal of CrowdFunding, Dmochowska explained, is to complete the cycle of online funding, which in the US begins with bootstrapping using an entrepreneur’s own money, and proceeds via angel funding or an incubator to the venture capital stage, after which the usual exit is either a sale to a bigger firm, or a stock market listing.

The early phases of this cycle are missing in SA, she says, which leaves venture capitalists with little to invest in.

Yet they need to hedge bets by picking 10 or 15 promising companies to fund, in the hope that two or three make it big and provide the ten-baggers or better that makes the fund profitable.

“SA has lots of clever people, with great coding skills, and good knowledge of how to take products global,” she says. “But because there is a lack of funding, many don’t even try.”

Unlike in other countries, the banking sector is so uncompetitive and risk-averse that there’s little chance of entrepreneurs being able to use loans or credit cards for bootstrapping. Government programmes, if they understand the technology and business model at all, take 12-18 months to reach the approval stage, by which time the world has moved on and the idea is usually stale. Bureaucracy and inexperience is not conducive to grabbing first-mover advantage.

“It’s more than just about the money, she said. “Investors will have the knowledge that they’re part of a network of people who want to help, and make up for lost time. Corporate South Africa is also very supportive, and is happy to provide work space, equipment, and other help. That shows we have a model that people really believe in, and understand. There’s also already a huge interest in second-round funding. A network of mentorship has been built too.”

Her audience was small — as is common with the many simultaneous panels on the programme — but very receptive of an idea that wasn’t about the presenters, but about the start-ups and entrepreneurs around them. Many offered congratulations and asked questions, hoping to learn from Dmochowska’s experience.

It prompted not only glowing local news coverage in the USA, but also interviews with international channels such as the BBC.

“The reason this will be successful,” Dmochowska says, “is that the money is almost incidental. Start-ups will be able to tap into our network, and be able to get to experts at only two or three degrees of separation, and get help, advice, or skills.”

The other reason is illustrated by Spratt, in the form of an example: “We have the Development Bank of Southern Africa, and the Industrial Development Corporation. But when Personera, an SA start-up founded by Sheraan Amod, presented them with a great idea on which it had to move quickly, the IDC took eight months to decide that it didn’t understand the business model.”

As it turned out, several angel-funding entrepreneurs from successful companies such as Yola and Clicks2Customers stepped up with risk capital to provide the funding that the official channels failed to provide. The company is already a great success, with a growing international market and rising public profile.”

The hope is that CrowdFunding can fund 10 or 15 such companies with the first fund, and produce the requisite two, three or more successes that go on to receive second-level or venture capital investment.

“We’re hoping CrowdFunding will succeed,” says Dmochowska, “and wake up the IDC.” – Ivo Vegter, TechCentral
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True/Slant: Can you crowdsource music journalism?

Leor Galil reviews AOL’s recent experiment in covering the music portion of massive US festival and conference SXSW: AOL offered 2,000 $50-assignments to create coverage of the event for its music site Spinner. The freelancers were recruited via freelance content site Seed.com with the aim of covering all 2,000 bands appearing at the festival.

There’s a certain crassness to AOL’s experiment. The very concept places more weight on quantity vs quality, and the setup undermines the very ideals and democratic nature of web publishing and blogging. With blogging, most bloggers pour their blood, sweat, tears, time and love into a little blog that may not get a lot of hits: many see zero monetary gain. It’s a labour of love, and the best content (or most creative, etc) tends to rise to the top and get noticed. And, one hopes, those who are able to create some fantastic content on a consistent basis can begin to establish themselves online and perhaps make some money for their hard work.

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Crowdsourcing vs. blogging in music journalism

SXSW, the internationally renowned music trade show, officially kicks off the live music portion of the expanding festival tomorrow. It’s the one week of the year that Texas bests every other state in the union in the “holds more music geeks per square foot” contest.

In the ever-evolving realm of music journalism, media outlets are consistently trying to figure out the best way to maximize their coverage of something as massive as SXSW. So, I was slightly intrigued about AOL’s concept for tackling the issue of covering the thousands of bands playing SXSW head on. As paidContent explained [via The Daily Swarm]:

AOL is trying its most ambitious super-content project yet with freelance content site Seed.com: offering 2,000 $50 assignments on SXSW bands for its music site Spinner.com. New Seed programming director Saul Hansell sees it as the “perfect chance” to showcase reporting and journalism along with what Seed can do for sites within AOL (NYSE: AOL). The basics: Spinner and Seed are recruiting U.S. “reporters” to interview all 2,000 bands for a Q&A and bio in advance of the March Festival.

But, I stopped myself from enrolling in the experiment myself. Why? It’s not like I couldn’t use the extra cash. Hey, $50 for a quickie interview ain’t half bad, right?
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