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Crowdfunding platforms creating buzz online
© Image: Eric Mack / Crowdsourcing.org
editorial

Crowdfunding platforms creating buzz online

Recently, Crowdsourcing.org partnered with KL Communications to try and determine how much people are talking about the different forms of crowdsourcing and how positive they feel about them using something called sentiment analysis. This type of analysis takes a look at mentions of various crowdsourcing platforms on the web and in social media to figure out how much and what kind of buzz they're generating online. To learn more about what exactly sentiment analysis is and what it told us about public opinion toward crowdsourcing in general, please read the first piece in our series here.

For the second installment, and for the next four to follow, we're going to take a look at the results of our analysis for one of the five crowdsourcing categories. First up, crowdfunding -- this includes financial contributions from online investors, sponsors or donors to fund for-profit or non-profit initiatives or enterprises.

More specifically, here's how we defined it for the purposes of our analysis:

"Crowdfunding is an approach to raising capital for new projects and businesses by soliciting contributions from a large number of stakeholders following three types of crowdfunding models: (1) Donations, Philanthropy and Sponsorship where there is no expected financial return, (2) Lending and (3) Investment in exchange for equity, profit or revenue sharing."

According to our sentiment analysis, Crowdfunding isn't the most buzzed about crowdsourcing category--crowdfunding sites garnered only about a tenth the amount of mentions of distributed knowledge sites
like Wikipedia. (More on the breakdown by category in our first installment of this series) The open-source encyclopedia and its brethren have a few years head-start on most crowdfunding sites and have already been adopted by the wider mainstream culture. Digging a little further into the data, mentions of crowdfunding and crowdfunding sites in social media are much more likely to be positive--about 90 percent, compared to just above 70 percent for mentions of distributed knowledge sites.

Not surprisingly, crowdfunding heavyweight Kickstarter receives the most absolute buzz (total mentions) online, with more than twice as many mentions as the number two site, microfinance pioneer KIVA. But KIVA could be primed for a jump in buzz, as it recently launched Kiva Zip, a platform for peer-to-peer microlending that eliminates the middleman (and comes with a higher risk of not being paid back). Rounding out the top five most-mentioned crowdfunding sites, IndieGoGo was a distant third, followed by Crowdrise and SeedCamp.

 

Micro-loan provider Accion leads the second-tier of crowdfunding platforms, as you can see in this continuation of the bar graph below:

 

Looking at rates of normalized buzz (how each site trended from November, 2010 to November, 2011), IndieGoGo saw an increase of over 200 percent, while Kickstarter also saw consistent growth and startup incubator SeedCamp got a huge bump in buzz in September of 2011, likely thanks to its annual SeedCamp week competition and some new partnerships and initiatives announced in that month. Meanwhile, non-profit fundraising sites First Giving and Razoo saw only modest gains in buzz over the same period.

 

All the most buzzed-about players in crowdfunding received overwhelmingly positive sentiments on social media. Razoo, Kickstarter, SeedCamp, IndieGoGo and FirstGiving all had over 90 percent positive comments online. SeedCamp had the highest proportion of positive comments by a slight margin.

 

According to Netbase, in general about 65 percent of social media comments are positive, while
the other 35 percent are negative, so in conclusion it seems crowdfunding is the subject of resoundingly good vibes overall.

- KL Communications is a leader in building and managing proprietary insights communities for a wide range of industries. Their proprietary IC2 community platform incorporates social media, crowdsourcing, as well as traditional research methods, which are aimed at providing partners with the tools and insights to keep them a step ahead of the competition.

 - Eric Mack is a contributing editor for Crowdsourcing.org. He also currently contributes to CNET. In the past, his work has been featured by NPR, Wired, the New York Times and other outlets. You can contact him at eric.mack@crowdsourcing.org. Find him on Twitter and Google+. Also be sure to follow Crowdsourcing.org on Twitter.

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