From the Statue of Liberty to a lifeboat, crowdfunding pays off

Many hands make lifeboat work... the Berck-sur-Mer crowdfunding scheme raised enough to repair their tractor but also to train more volunteers

From charity fundraisers to business start-ups, people are turning to crowdfunding websites to raise capital. But just what is crowdfunding, and how does it work? Jane Hanks finds out

When the lifeboat tow tractor at Berck-sur-Mer broke down, the volunteers tried to raise €3,000 to pay for repairs... but when traditional channels did not work they turned to the internet, and a crowdfunding website helped raise enough to do the repairs and save the station from closure.

In all, they received €5,110 and Berck-sur-Mer SNSM president Guy Lardé said: “We were able to reach a much wider public. Only about 25% of the money came from local people who already knew us.

“Half was sent by donors in France and the rest was international. We had money from donors in Patagonia, Lithuania, Austria and Belgium.”

Crowdfunding is a fast-growing sector in France. Figures show the amount of money collected through website platforms doubled in 2015, as 2.3million people helped finance charities or commercial projects.

The system allows individuals to give, lend or invest their money through a website without having to go to a bank. It is the financial world equivalent of Airbnb or BlaBlaCar but has origins going further back: the Statue of Liberty was funded in 1875 by 100,000 subscribers to sculptor Auguste Bartholdi’s project.

Among the best-known of the crowdfunding websites springing up are KissKissBankBank, My­Major­Company, Indiegogo and Ulule.

Usually the website organising the collection of funds asks for a percentage of the sum raised if the pre-determined amount is achieved. If the sum is not raised donors get their money back. A pre-determined length of time is allotted to the project.

There are four main ways of raising money via these sites.

One is where a business may offer an incentive to invest, such as a company raising funds to manufacture a new product offering pre-orders at a favourable price.

If the appeal ...

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