Crowdfunding the Commons: Interview

We are reinventing social and cultural practices. By necessity and desire. New ways of collaborating require, not the least, new ways of organizing financial means. In the cultural sector, commercial models based on copyrights (selling copies) and government funded models (subsidies) are in crisis and are increasingly inadequate or politically unsustainable.

If we take the crisis of (cultural) production seriously and are looking for alternatives, three developments need to be taken into account. First, while we should not let the state simply skip out of its responsibilities, it's unlikely that public cultural funding will ever expand at the same rate as cultural practice. Second, producers and users are coming in much closer contact with one another and in the process the roles in between “artist” and “audience” are multiplying. Third, the control of the distribution and use of copies cannot be a way to finance the creation of the first copy.

The most innovative answer to these issues has been the rise of crowdfunding, as a way of pre-financing the first copy by creating a community around emerging projects. has established itself as the dominant model and countless derivatives are imitating it.

Unfortunately, Kickstarter is, in essence, simply a reverse market. Rather than buying the product after it has been produced, one can now buy it before it is produced and, if one donates more than a certain amount, inscribe oneself to a very limited degree into the product itself (e.g. by being mentioned a co-financier in the credits of a film project). Besides that, very little chances.

But does that need to be? Crowdfunding is a promising field because it can address many of the dynamics that underlie the crisis of the cultural economy and its transformation from a commodity- to a commons-based environment. So, it's high-time to think about and experiment with this approach in a more comprehensive way and explore more radical approaches to alternative cultural economies. How can these new means be used to fund the commons, rather than to kickstart yet another round of “cool” new products?

To explore this question, Felix Stalder caught up with Enric Senabre and Olivier Schulbaum who recently launched the Spanish platform Goteo (which means “to drip”) which bills itself as a “social network for co-financing and collaborating with creative projects that further the common good."

FS: You started your crowdfunding platform in 2010, just when Kickstarter was establishing itself as the dominant model in this field. Why do something different?

First of all there's the practical limitation of not being able to publish projects without an American bank account. But there is more than that. Kickstarter and many similar platforms design the crowdfunding process in ways that very easily lend themselves to what we see as problematic practices of "crowd capitalism." For example, one of its most prominent projects, TikTok, a watch based on the iPod Nano, uses crowdfunding simply to expand the commercial model. Raising money to initiate standard global production processes, even subcontracting critical tasks to global sweatshop factories, no matter how or where.

Especially that last thing, we don't want to support that. Or take Diaspora, for example. The distributed social network project had a great success when when it launched its crowdfunding campaign. Yet, eventually Kickstarter changed its policies in order to avoid software development projects. Maybe because Disapora started to become too prominent for the platform and threatened its brand-building. The main issue seems to be that software projects often have not-so-clear rewards and the boundaries between contributing money and contributing other stuff is less fixed, as compared to other types of projects such as movies, videos, books, music, etc, where you get, say, a printed copy of the book when you donate $20, and a signed copy when you donate $50 and so on, but are otherwise not really involved.

So, the “Kickstarter” model seems to limit the sociability of projects when they break down the barriers between “artists/producers” and “audiences/consumers.” For example, by being able to accept contributions other than money and thus really generating a distributed or cooperative economy.

But these are the aspects we are most interested in. We think the crowdfunding processes offer many opportunities for learning, collaboration and community if we explore the full range of “crowd benefits,” financial as well as social ones.

Could you explain what you mean by sociability of a project?

Goteo’s approach is that crowdfunding should also imply crowd benefits or community benefits, if you prefer. These benefits might be social, educational or economical in character. We want to look at these things together, rather than as different dimensions separated from one another. Thus, our projects need to have a strong connection to the commons.

Goteo establishes, together with producers, lawyers, economists and fiscal experts, a simple, effective tool for both donors and recipients to make transparent the core principles they are committed to in the project and how these lead to reinforcing the commons and assuring shared community benefits. This question of sociability is really about developing the skills of interacting well with others, on a peer-to-peer basis.

Euros. Credit: mammal on Flickr. Used under Creative Commons license.
Euros. Credit: mammal on Flickr. Used under Creative Commons license.

A central question is how do we generate a new economy and realize the potential of collective production? We need to go beyond the co-creation standards of the industry. We want to ensure that innovation is distributed. So we want to combine crowdfunding with crowdsourcing in a way that does not simple help private companies to improve their products.

Rather, co-design should imply opening up to contributors the processes of micro-entrepreneurship, micro-distribution, micro-production. In other words, everyone who contributes to a project should become part of the economic/productive/creative process they helped to improve, rather than support the generating of knowledge and resources for a private party.

An example of a fertile territory for such a development is open hardware or the emerging open craft movement, which is growing particularly fast. If we can get to the point where backers or donors of a project end up being the future producers or providers for the community or find their way to be actively part of the project they helped, this is when we really open the circle of sociability!

Besides sociability, we also talk about a commonability or shareability. So part of our mission is helping producers or organizations with defining their scale of shareability well. That's why in Goteo we make a clear distinction between social good and commons good. NGOs are usually oriented toward social goods in the sense that they are orientated towards creating positive change in concrete places or communities. For us, this is not enough. Goteo isn't really interested in social initiatives if they don't clearly establish a collective return.

This means that they ensure that the project is transferable and reusable by other people and collectives (common good) according to the rights which govern free knowledge and which are usually regulated on a legal level through free and open licenses.

Something we are observing with Goteo is that the more tangible a project is, (for example the DIY shoes kit, a project with the support of Fablab Barcelona), the more sociable it gets. It reminds me of a conversation with Dmytri Kleiner about his text Critique of Peer Production Ideology where he pointed out: "What is needed for Peer production to incorporate material goods into the common-stock is a system for the allocation of material assets among the independent peers which imposes only a minimal co-ordination burden.” We think this is a key point!

But of course, again because crowdfunding is not really about money and more about creating communities, OPEN CROWDFUNDING SHOULD BE CROWDFUN!

How does that translate to Spain, where Goteo is situated?

Over the years here, we have seen more and more projects developed by creative agents operating beyond the traditional boundaries of art/culture. These are often projects with a high level of innovation and enormous potential for social and economic impact and growth, capable of generating value in the broadest sense of the word. However, the Spanish context still lacks the proper communication channels to connect creative individuals, social/cultural agents, and potential investors and micro-donors.

We are still tied to traditional resources such as grants and sponsorships, which we think need to be redesigned. Becoming that channel is precisely the goal of Goteo. An online community capable of creating efficient and transparent links between public and private agents; to identify problem areas and suggest possible solutions; and to facilitate a catalog of financing options, infrastructures and other resources.

Given the current socioeconomic situation in Spain of less and less sources of public and private funding for such type of open initiatives, at a local, regional and national level, there is much more urgency for new practical alternatives such as ours.

You say that Goteo is less about raising money and more community-building. Can you explain how this works, and what Goteo offers in the case of a concrete project?

Apart from raising money, every project or campaign also has the opportunity of asking for collaboration in different areas, that includes, knowledge, concrete tasks, infrastructure and/or material goods. This is something that we knew was important to attach to the crowdfunding model. This would open it towards crowd sourcing in a form that could lead to more community building and shared processes while creating an open project.

For example, tuderechoasaber. This is project is about creating a web-based service where any person will be able to send and access open data information requests to Spanish public bodies. Apart from raising more than the 150% of the minimum funding needed, it asked and has received many offers from people. From gathering contact details for public bodies, to server administration and moderating on the site (solving questions from new users, verifying requests are not spam, handling email bounces, etc), or translating the platform to several languages.

Another example could be the Infinit Loop. It's a reusable wrap for gifts of high quality cloth with QR identification code, that allows you to follow further presents with web geolocation. It got all the minimum funding needed and also help from many users who wanted to be volunteer beta-testers of the system, and app developers for smart-phones. Even offers of partnership to produce and distribute their product (which has an open licensed design).

Symbolic check from Goteo to Nodo Movil.
Symbolic check from Goteo to Nodo Movil.

A third case could be Nodo Móvil, a mobile wifi connection unit for social movements and public spaces. The project raised around 145% of its minimum goal as well as developers, a hacklab space for working, a 3D printer for prototyping, testers for arduino, Xbee, Android and GPS, and collaboration from a local entity to help test it on a public area. This even applies if they could not achieve their minimum financial goal, but are able to benefit from other forms of contributions.

We gather all this dynamic information at every project's message wall, where people can publicly agree to collaborate. At the same time, Goteo offers the tools for basic communication between project leaders and volunteers (one-to-one or in groups). Once the conversation has started, every project can use its own communication or collaboration tools for getting the job done, but we think it's important to first have that kind of social agreement on the site, encouraging transparency and examples of mutual help.

How many projects have managed to get off the ground thanks to Goteo?

Twenty-five projects have been fully funded and supported so far. They gathered more than 100,000 euros and around 400 offers of different type of collaboration. At the moment there are 18 more still in campaign, and most of them are doing pretty well. We're scaling a little bit these days trying to apply all the lessons learned during the first four months of activity, from project edition assessment to media follow-up during campaigns. I think it's important to take a qualitative look as well at the first results, since at the moment different collective benefits are being created.

Some examples: Tuderechoasaber is already providing the beta version of its Rebelaos! and has distributed 500,000 issues around Spain of a paper publication for social transformation.

Copy this Festival has developed a formula for spreading self-organized Creative Commons film festivals, and is being replicated in cities like Lima and Buenos Aires, with many more to come in the forthcoming months.

Infinit Loop is sending its initial prototypes to backers and testers, with its alpha version of the platform already produced. These, and some other projects (even some that have not been successful at their campaign), are mainly performing well precisely for the commitment made with backers but also collaborators, and this community building or amplification process helps them and motivates them to do things quickly and properly.

KinoRaw is developing audiovisual tools and extracting all the juice out of Blender software for experimenting with the Elphel open hardware camera.

Goteo does not just do crowdfunding and crowd sourcing, but also works on creating a foundation that distributes money and resources in a more traditional way. What is the foundation about and how do the two mechanisms (foundation and crowdfunding) relate to one another?

The foundation, Fundación Fuentes Abiertas (which means “open sources”), does two things. First, it's the legal entity that runs Goteo. The project leaders sign a contract with the foundation in which they specify individual rewards as well as the collective return of the project. The foundation receives the donations from backers and distributes them to the projects. It is also the receiver of the percentage of transactions, 8%, that goes completely to cover work that goes into the platform and the support given by the platform to the projects.

The foundation publishes yearly results, budget and operations. Second, it also provides the framework for partnering with other institutions. We are trying to raise feeder capital, that is money that is not donated to individual projects, but is raised by the foundation itself through specific campaigns, agreements and parallel activities like the workshops. This money is then distributed to projects directly by the foundation. This will help us to support projects we think are important but have a hard time raising the necessary funds.

We seek new ways of funding that not only include individual funding and cooperation, via crowdfunding, but also a clear approach to alliances with main actors (public bodies, organizations, other foundations, companies) that share our mission and can add “feeder capital” to specific calls and projects. This way we could somehow bypass current problems and paradigms, by letting them participate in a new model where crowdfunding is moving even more resources and multiplying people's impact.

What are the immediate steps and challenges to develop further?

We're always working on the technical and foundational concepts of the platform. From recent improvements like the wall of friends, to easily visualize and share backers, or a landing page for specific calls, to other ones underway like an open data module for easily obtaining aggregated data and more visualizations about open crowdfunding, as well as a "Recommended by" badge for certain projects or a "flat rate" for regular donations of highly attached members of the community. (See more information about the landing pages here and here.)

We also focus on developing an open algorithm to facilitate dialogue between project producers, local public administration and private micro-investors and mid-investors, as well as producing a set of open data stats regarding the projects and tendencies and backers' psychology and motivations, trying to define limits between open philanthropy and open investment.

The most important step at the moment, though, is the development of a separated platform for the first official autonomous node of Goteo that will be in the Basque Country. We fund these activities in partnerships with other institutions and occasionally public funding on specific topics and areas of interest that match our mission.