Crowdfunding is becoming an increasingly common way of funding projects in the art and culture sector. An important characteristic of crowdfunding is that it is a social happening. Donors are involved in the project in a special way.
What is crowdfunding
You or an intermediary recruit fans who all donate a small amount. Within a few weeks, a sum can be raised that can vary from a few hundred to tens of thousands of euros. In exchange for their donation, the donors receive a reward in kind.
Crowdfunding is no substitute for structural subsidies, but it is a useful resource in addition to an application for subsidy and is suitable for the funding of small-scale projects. It is best to resort to crowdfunding as the last step in obtaining your budget, because that is when the chance of actually getting the project implemented is highest. That makes it more interesting for the donors to make a donation.
Crowdfunding also provides information about the extent of the support for the project. If you opt for crowdfunding, you will also be challenged to think hard about your concept and how you present it. How do you pitch your ideas to make people want to give money to them? You can gauge how much enthusiasm there is on the basis of the reactions.
How does it work?
As the initiator of your project, you announce it on a crowdfunding platform or set up a website yourself. You have to spend time on involving donors with your project: friends, relatives and fans. If donors can feel more involved, they spread the information and the fundraising can proceed very quickly.
Donors will be invloved in different ways: one gives without wanting to know a lot about the project, whereas others ask questions all the time.
Fiscal aspects for recipient and donor
Crowdfunding can be compared with applying for a subsidy, and in principle you do it through a foundation. It is important for the recipient to know that donations to a foundation are not taxable. Nor is there any VAT on donations. You only pay a percentage of the sum donated to the intermediary if there is one (the platform).
Crowdfunding platforms such as Voordekunst have the status of Institution Aimed at the Common Good (ANBI). That makes it more attractive for donors to donate. Their donations are tax deductible provided they amount to at least 1% of the threshold income. Private individuals can deduct 125% on their income tax declaration, companies can deduct 150% from corporation tax. For more information about the conditions for deducting donations from tax, go to the Tax Office website.
- Make an overview of your network and think of who would donate € 10 and who would donate € 50, €100 or maybe more.
- Both the start and end of the project are the easiest, so ask people who want to give anyway, to donate in the middle phase of your project when it is most difficult to get money.
Both small and large projects use crowdfunding, for example the Amsterdam Museum and Museum park Orientalis.
Projects in a variety of disciplines were presented on voordekunst.nl. Another site is Voor de Kunstenaar, an initiative of the world of industry and commerce. IndieGoGo is an international crowdfunder for large-scale and small-scale projects in every discipline.