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CFAS_150412: What is Crowdfunding to me?

Steffen Peschel started an interesting action, in his Kultur2Punkt0-Blog with crowdfunding on Sunday (cfas), which I willingly want to support. On this weekend, it’s all about thinking individually about crowdfunding – “What is crowdfunding to me”?

Well, where to start? In January 2008, my attention was drawn to SellaBand through an article in the WiWo (economy week). It was my first contact with crowdfunding (CF) and in Germany, at that time, only the fewest had heard something about it. At the time I was convinced, that CF could be a) an investing opportunity and b) a way of revolutionizing the music industry.

At least this is what was suggested during the establishment hype of different music CF-platforms (among which ForMyBand, Slicethepie). The alternative a), means the wish to make money through CF (as an investor), quickly turned out to be a deception- at latest when the first SellaBand albums didn’t turn out to be bestsellers. Even the boastfully announced revolution of the music industry is, so far, absent… even in the CF industry one is still tied up to the old ways of thinking. Today, crowdfunding has lost a lot of its magic. SellaBand, in the meantime, has declared bankrupt and found its way back again, ForMyBand from Berlin doesn’t exist anymore. And even Slicethepie no longer has anything to do with CF. Even all the other providers seem to have found their spot in this recess. There obviously is no sufficient market to be able to make money out of CF. For me, crowdfunding in today’s music is a niche product, which with the current approach of it only being a project-related mediator between musicians and fans, barely exploits its potentials and in my opinion doesn’t have much of a future as a business model. In this way, it will neither help revolutionizing the music industry, nor help musicians overcome their dependence on record deals/ record labels. Here, three theses that music-CF could possibly develop in the future:

1. CF-platforms need to become full-service providers and consistently develop and market musicians with new, creative ideas- meaning, they are a new form of a record label (“Crowd label”) – in order to do so, they have to separate themselves from a simply project-related way of viewing, possibly also find other organizations or alternatively types of companies ( for example cooperatives), which will help implement it all,
2. CF needs to find its way back to what really makes crowdfunding decisive: the crowd- the community is the most important aspect of CF but today it’s mostly left behind- investing in developing a community is therefore the crucial success factor for a CF platform.
3. CF in Europe doesn’t work if based on a national standard- there’s a national CF platform being provided to a small market- problems here occur because of the different cultures in Europe, which need to be overcome which need to be individually catered to- at the moment, Sellaband (still) is well constructed in this aspect.

I look forward to the discussion.