Civic crowdfunding catching on

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MORGAN LOWRIE THE CANADIAN PRESS | May 18, 2015

Village Ephemere campaign

Municipal projects make use of online campaigns  

MONTREAL — At a time when municipal budgets are stretched and urban-improvement projects may not top a city’s priority list, community groups, non-profits and local governments are increasingly turning to crowdfunding to help finance public projects.

Crowdfunding websites, which allow groups and individuals to solicit donations online, are usually associated with artists, entrepreneurs and humanitarian projects. However, a small but growing number of crowdfunding campaigns are looking to finance civic projects such as artwork, and green and public spaces.

In the United States and Europe, purpose-specific sites such as Spacehive, IOBY and citizinvestor have been used to fund everything from bridges to bicycle services (see Liberty Village Crowdfunded Bus Line Six).

Although in Canada the practice is less common, the presence of some homegrown web platforms and a host of online campaigns seem to indicate that civic crowdfunding may be on the rise in this country.

Last week, securities commissions in six provinces also set up rules to allow Canadian businesses to raise equity through crowdfunding.

There are several advantages to crowdfunding urban projects, says Nicolas Koff, the co-founder of Projexity, a Toronto-based crowdfunding website that helps groups gather resources for local projects.

View:  Hon. Brad Duguid Endorses Canadian Crowdfunding & Officially Opens Inaugural CCS2015 Summit

These can include engaging people and bumping up the timeline of projects that would otherwise take years to complete.

“A lot of projects remain on the table for five, 10, or 20 years because they’re never really high priority,” Koff said. “We’ve seen a lot of really great projects fall through the cracks due to lack of visibility, lack of engagement, lack of resources.”

Projexity’s most successful project to date has been a public patio for Market 707, a shipping container market in Toronto. The site raised $6,500 and also sought public input on the design and on the hiring of labourers — something that would have been impossible had the project been done entirely through municipal channels.

“Crowdfunding allows you to go beyond the bottom-line design you get in a lot of our civic spaces, where everything is mostly based on trying to get the most cost-effective project,” Koff said.

Another Canadian-made site, Raise an aim, was started last year to help municipalities crowdfund their projects.

But founder Abdullah Mayo concluded that city governments were still more reluctant to jump on the crowdfunding bandwagon than their American or European counterparts — either because they didn’t have the skills for a successful campaign or because they were reluctant to solicit citizens for additional funds.

“A lot of Canadians feel like we pay enough taxes already, we should be able to have water fountains and good hiking trails,” he said.

He has refocused his aim with a new website, lbx.com, or local bond exchange, which helps municipalities market and promote the sale of municipal bonds to residents. “We’re using the elements of crowdfunding to essentially take all the processes municipalities have now and making them more transparent and easy, using these online platforms.”

He says at least six cities are interested in signing up for the currently beta-version website, including the Ontario communities of Hamilton and Kitchener as well as Victoria, B.C.

Other Canadian groups are using traditional platforms such as Kickstarter and Indiegogo to try to fund their projects.

In Montreal, a group of urban design and citizen groups have launched an Indiegogo campaign to finance a project they call Village Ephemere, a summer-long public gathering place with street food, local artists and vendors.

They want to fund the project’s third edition with $40,000 in crowdfunding, hopefully in combination with city grants.

View:  Canadian Crowdfunding Directory

Jerome Glad of the non-profit group Pepiniere and Co., which is spearheading the project, says city funding is uncertain and that corporate sponsorship comes with too many strings attached. Crowdfunding, he says, can ensure citizen participation while making up for funding shortfalls.

“If we manage to get funding from citizens, it really reinforces the spirit of the project, which is a participative, collective, community project,” he says.

Another group in Lethbridge, Alta., has launched an Indiegogo campaign to save two historic buildings that make up the city’s Chinatown. They, like most, have turned to a variety of resources to attempt to fund their project, including a grant from the municipal heritage resource fund that matches every dollar raised.

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The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding stakeholders across the country.  NCFA Canada provides education, research, leadership, support and networking opportunities to over 950+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding industry in Canada.  Learn more About Us or visit www.ncfacanada.org.

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