Amit stopped his motorcycles at the signal as it turned red. He is a careful rider obeying all the traffic rules. As he nudged forward at the green signal, he heard the roaring of a beast and blacked out. All he remembered was the roar. A delivery truck was rushing to beat the signal and raced towards the crossing, ignoring the traffic signal. Then, the inevitable happened. Amit was moved quickly to a nearby super specialty hospital.
Amit survived a hip fracture besides critical neurological issues. It took him over three months to walk again. Amit believes in providence. The place of the accident close to a hospital perhaps saved him. But, funds for treatment – over Rs 20 lakh – also came fast and smooth.
No, the middle-class family did not sell their house – they never had one. It was the efforts of his colleagues who started a fundraiser. It was crowdfunding that took care of all the costs.
Today, aided by technology, several online crowdfunding platforms in India are helping people tide over their crisis moments with dignity. However, it is the ordinary citizen who most benefits’ from Crowdfunding. Ketto, a pioneer online platform, has several fundraisers running to help hundreds focusing on service and transparency.
It is essential to understand what crowdfunding is, how it works, and how to start a fundraiser in case of an eventuality. In simple terms, crowdfunding means a vast number of people donating small amounts for a cause that creates a large pool of money. The money is then used to help individuals (or organizations) overcome specific economic or social hurdles.
Crowdfunding is a recent tool for raising money for a cause. However, philanthropy is an age-old tradition in this country. There are several educational institutions and places of worship established out of collective donations.
Digital technology and the ever-increasing reach of the internet have made crowdfunding the most preferred fundraising option. The simplicity and ease of operation often make people look towards crowdfunding when they urgently need to meet medical treatment costs for family or friends. Besides that, nonprofit organizations use crowdfunding platforms to help strengthen the social sector, supplementing governmental programmes.
Starting a donation-based fundraiser is simple and does not require a lengthy application process. Moreover, crowdfunding is a perfectly legal way of raising money. Therefore, you should not doubt using a crowdfunding platform in an emergency. But, in the end, inevitably, it is people like you and me who most benefit from crowdfunding.
A donor to a project or a business receives a non-financial reward like goods or services; it is mainly to the business sector.
Here the borrowers and lenders are matched through an online platform. Borrowers get their funds quickly (from the lenders), typically at lower than regular interest rates. Again, small businesses and startups are the primary beneficiaries.
In Donation-based crowdfunding, the beneficiaries are ordinary individuals and society.
How does crowdfunding work?
Typically there are three parties or stakeholders involved in the process. The one who needs the money (an individual or a group or an institution) is the beneficiary; people who make contributions are the donors; and the online host, the crowdfunding platform.
The beneficiary (or someone on their behalf) gets in touch with an online platform to finalize the fundraising programme. Suitable promotional strategies are worked out to ensure success. Finally, funds received by the platform are transferred to the bank account of the beneficiary.
Online hosts typically charge a platform fee (0% at present for Ketto), payment gateway fees plus a percentage of the money collected as a success fee and applicable GST of 18%.
Starting a Fundraiser in 4 Easy Steps
1. Define your fundraising objective and goal:
Individual or organizational; medical emergency; educational or social cause; fund amount and period of the campaign.
2. Select an online platform:
Research comparative policy, payment handling, update tools, customization, professionalism, ease of use, the success rate of previous campaigns; ensure the platform has experience of your type of campaign.
3. Strategize your campaign:
Communication plank, use of social media, monitoring progress, donor updates.
4. Share your story with the community:
Make use of social media to take advantage of the digital capabilities for faster communication.
Tips for a successful fundraiser
Reach out to your social circle, including the extended one (distant relatives, ex-colleagues, acquaintances); intimate objectives and timelines
- Target at least 25% to 30 % (of the total funds planned) from your known people.
- Use direct contacts (e-mail, WhatsApp, phone calls) and social media; request everyone to share the message.
- Update progress to your community (but not too often)
2. Monitor Progress
- Use follow-up mail and messages
3. Express Gratitude
At the end of the period, make it a point to thank all your supporters and tell them how crucial their support was in meeting the goal.
- If you are a nonprofit, talk about other projects at hand
Good content is a key to success; ideally, the write up should contain a crisp story on the issue (for fundraising) with a personal touch.
Who benefits from crowdfunding?
The principal beneficiaries of fundraisers are,
- The people at large looking for funds to tide over an emergency
- The nonprofits or NGOs working on social projects
- Even companies navigating tough financial situations
A one-word answer to the question often asked, who most benefits from crowdfunding, is the society. Whether in a medical emergency or a pressing educational need, one should never hesitate to take the perfectly legal help of crowdfunding
Want to help someone looking for funds? Or want to start a fundraiser? Get in touch with Ketto, India’s most successful fundraiser supported by over 55 lakh donors. Who knows, your fundraiser can change someone’s life.
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