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Crowdfunding- A Concept Whose Time Has Come?

Crowdfunding- A Concept Whose Time Has Come?

[This article was originally published on Social Media Week Global blog]

On Tuesday 20th September, at Social Media Week Glasgow, an entire day was spent dealing with the subject of Crowdfunding. The founders of the Crowdfunding platform SoLoCo– which launched that same week – had gathered together an impressive group of representatives from some of the major crowdfunding platforms in the UK for a workshop-based happening, highlighting the opportunity and the collaborative spirit of those engaged in this increasingly talked about activity. It was right and proper that this happened during Social Media Week as the links between crowdfunding and the reach, empowerment and engagement of social networking are strong ones.

Of course the idea of raising money through collection from donors or investors is neither new nor novel. But crowdfunding goes beyond that. Fundamentally it is rooted in the idea of microfinance, the notion that small sums, when aggregated, make a difference. It is that idea of a groundswell of small actions that, when gathered together, have a significant impact that is at the heart of so much of the attraction of social media and social networks as a method to effect action and change. It is in this link we can begin to explore the affinity between crowdfunding in particular and social media in general.

If we refer to Charlene Li and Josh Bernoff’s book Groundswell they make a point of illustrating that much of the empowerment and impact of social networks is often found in communities and consumers of whom a brand or organisation may be completely unaware. And so it is with crowdfunding. Your intention in a crowdfunding campaign should be to reach beyond your immediate tribe and tap into individuals and groups that you may not be aware of and perhaps, before your campaign began, were unaware of you. This process is possible through the viral referral and reach of social networks where you seek to make first touch contacts into advocates and ambassadors to use their connections to jump the six degrees of separation to a global investor community. This means we must embrace diversity and accommodate emergent views, and accept that motivations to get involved are many and varied and not necessarily the ones we immediately imagine. In a highly networked and diverse world we need to broaden our notion of expectation of return in keeping with the sort of groundbreaking insight developed by people like Yochai Benkler in his work Coase’s Penguin.

Our next step down this path will take us into the notion of The Long Tail as popularised by people like Chris Anderson. This is a concept that lies close to the heart of crowdfunding and many of the innovative economic models being enabled though social networks. To tap into the long tail the cost or barriers of each “transaction” needs to be sufficiently low to make it “economic” to work there. Once there, the traditional models are no longer the only game in town. In a crowdfunding scenario, the transactions barriers are lowered by making the contributions small enough to extend the number of people who are both able and willing to participate. The turnkey crowdfunding platforms that provide a transactional solution for a crowdfunding campaign reduce the friction and costs further and make the process increasingly viable.

The transformational power of these tools is another feature that crowdfunding shares with the ethic and spirit of social networks. They allow us to reimagine ourselves in different guises, to become things that were once gated from us or perhaps we considered fanciful. In the same way that we can become film critics and political commentators, citizen journalists and inventors, the barriers and gatekeepers of investment fall away so that the rarefied world of finance becomes imaginable and possible for all of us. We can at last reimagine ourselves as engaged in what was once a closed world.

Crowdfunding has a strong relation to other behaviours that we would recognise as prime aspects of social media in the idea of validation and trust based on distributed cognition- or the slightly more vulgar wisdom of crowds. In crowdfunding we have a network of individual judgement and validation that can asses a business plan, market test a product, and police behaviours based on trust models. These all have value for those seeking both insight and investment in their plans and products, and is born out in the security of many crowdfunded lending models that enjoy repayment rates that high street banks could only dream of, based on transparency and trust tags.

Over the next few weeks we will post a few blogs that investigate and prompt debate around the idea of crowdfunding, its provenance and application, and its growing popularity as a mechanism for raising and sharing funds in a capital constrained but increasingly networked world. We hope you find them though provoking and informative and look forward to hearing your ideas as we step into what is an increasingly common activity in a campaigning world of engaged investors, funders, lenders and entrepreneurs.

If you want to learn more about crowdfunding and how to put together a crowdfunding campaign, then you might want to attend our workshop in Glasgow on the 14th of December

Social Media inside the firewall

Social Media inside the firewall

We often talk about the social media mindset. It should be clear to anyone by now that what we’ve been going through in the past few years has been a cultural and behavioural shift rather than a technological one. All the various tools we’ve been working with are tools that ultimately enable us to share and communicate with the world, be it the world wide web, our local community, our network of friends, or our workplace. And that’s exactly where we’re going to focus our attention in this and further posts on the potential of Social Media “inside the firewall”.

Social Media can – and should – be used internally as a mechanism for improving business performance. The internal use of social media goes under many names: social businessenterprise 2.0corporate social networking being some of the most popular, and they all include in their definitions different nuances of meaning. It’s basically a way of working that embeds the principles of Social Media revolution: many-to-many communication, collaboration, co-brainstorming, transparency, trust, participation, inclusiveness, co-creation, flattening of hierarchies. After all intranets were born before the internet, and they can easily work in the same way, by providing a platform for conversation, knowledge sharing and creation, content management, crowdsourcing, co-innovation, and so on. And as it’s happening with externally-facing Social Media, it’s not only about reduced emails, but it can have a much more holistic impact, going from improved – and self-organising – organizational structure, reward and recognition mechanisms, workforce motivation and morale, and so on.

As part of our ongoing research activity on yet another interesting aspect of Social Media, we came across an ever-growing number of platforms that are being used as private/internal social networks. We produced the tag cloud you can see below, generated by collating the texts of the descriptions of a number of these platforms (data gathered – among the rest – from the latest Gartner‘s Magic Quadrant for Social Software for the Workplace, and Forrester‘s Wave for Enterprise Social Platforms). Not surprisingly, all the platforms share a clear focus on social, and they often mention words like communities, collaboration, networking, creation, expertise, knowledge, learning, conversation, information.

 

Analysing their descriptions and functionalities, customer reports,       opinion pieces, users blog  posts we started noticing some common themes and models they seem to be converging around, as well as the advantages and  drawbacks according to the current users. In the same vein, last Tuesday we were invited to London  to an event organized by one of the fastest-growing internal social networks, Yammer, which we’ve been using during Social Media Week Glasgow to collaborate and share information, experiences and insights with other city partners. The event was hosted by Yammer founder and CEO, David Sacks, and enriched with the experiences of Yammer users Peter Kemper of Shell; Laurie Hibbs of Lexis Nexis and Suzanne Masters of ACCA. We will be sharing with you more on the above and further insights on the subject   in future posts.

 

Sustainable is the new profitable

Sustainable is the new profitable

I was sitting in a café today, sipping my chai latte and waiting for two potential clients/partners to come along. Table next to me, two men in business suits, talking about something.. Suddenly they said the magic words (exactly, social media, how did you know) and my brain unconsciously tuned in to their conversation. The exact sentence was: “how can they possibly help us with social media if they don’t even know how to use it themselves, hardly 100 followers on Twitter and 14 on their FB page”. At which point my brain detuned in despair.

Ok, I must confess I’m particularly happy if I can stay away from numbers. However what is this need to quantify everything, why are we always thinking in numbers when numbers are just not enough? It’s about intangibles values, it’s about strategic thinking. And it’s not a social media strategy, it’s a business strategy in which Social Media are incorporated. A strategy that aims to improve engagement and trust, rather than immediate return on investment. Engagement and trust can last for ever, money can always (and too easily) run out.

The most interesting people I met through social media are people like the ones I just left today. Oh yes, their numbers: followed by 58 people, following 101 because they “take the time to listen to them all”. And I “sacrificed” 5 potential new “tweeple” and one new follower (this is the ratio roughly) to take the time to meet two of my tweeple in person and discuss an idea with them.

Sustainable is the new profitable. And – guess what – it doesn’t do numbers.

Social Media is Unleashed!

Social Media is Unleashed!

What a terrific evening!

Social Media Unleashed took place last night at The Lighthouse, and it was a full house. The event was the brainchild of twintangibles and New Media Corp who, with the help of some key partners, were able to put it together in a very short time frame. We didn’t advertise it heavily but registration was busy very early on.

The level of interest in coming to the event was, I think, a reflection of a couple of things. One was the quality of speakers we managed to attract. Quality presenters covering important themes and case studies that demonstrate real examples of some of that theory actually put into practice. The second factor that made it so popular is that there is real interest in the business community in how they can engage with social media to generate value, and too few events that get to grips with that in a practical way. Our hope was that as a result of attending delegates would leave with lots of ideas, a better understanding, and no “cookie cuter solutions”. Based on the feedback we have received so far that seems to be what we achieved. Attendees have more insight, are enthused but recognise that each of their organisations needs to think through and plan their approach to using social media to generate value.  Each of their plans will be different as it will need to reflect their specific aims and needs and that they made some good connections that can help them in that process.

The keynote session, hosted by Adam Gordon of Gordon BDM, feature Richard Ward of LinkedIn who demonstrated the breadth of innovation and development on the platform and the many ways it is working to deliver value to its users. Richard was joined by Paul McComish who inspired the room with an insightful case study of how he has used LinkedIn to generate £millions of business. John McLaren shared some laser like insight of trends and strategic thinking that so typically characterises Gartner‘s work, and Alan McCormack of McClure Naismith closed the opening session with a lawyers cautionary tale of some of the ever evolving legal challenges of social media in the workplace.

Some great networking and a glass of something in the cultured surroundings of The Lighthouse filled the interval before we plunged back in to hear Colin Gilchrist of Digital Face give a very expert guide to the art of managing a crisis through social media channels (slides available here) based on real experience of how he has helped clients fight those fires. Last and by no means least Richard Moir, CTO of Cisco Scotland, detailed real case studies of how a trusted and global technology firm actually uses Social Media for a variety of applications both internally and externally facing.

To cap it all the whole programme was captured on film by a team from moviecom.tv – the Video Social Network based here in Scotland, and a team of budding journalists from City of Glasgow College.

Now for those that didn’t get there, and those that might want to revisit the content of such a packed evening we are doing our best to make some of the material available to a wider audience. Of course the challenge with such insightful speakers for such recognised and high profile organisations is that it takes  a bit of time to get all the clearance and releases required. I am a bit worried about some of my gaffes getting out there on the web, but I guess I can overcome the red face if it means sharing such great material from the speakers.

As and when we get it we will let you know. But next time make sure you book your place early.

Finally it only remains to say – if you enjoyed it let us know, if you want another let us know, if you have any particular aspects of Social Media you would like us to deal with let us know.

twintangibles and New Media Corp would like to thank the following organisations that contributed to making the event happen – give them a round of applause.

The Lighthouse

LinkedIn

McComish Group

GordonBDM

Gartner

MCClure Naismith

Digital Face

Cisco

Moviecom.tv

Glasgow Chamber of Commerce

City of Glasgow College

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