Is Crowdfunding Good for Science Research?

This post has been inspired by the Reading Nature project and my interactions with its researcher Riccardo Guidi from the Karolinska Institute, Sweden.

The coming decade is expected to see major breakthroughs in medical research, like the personal genome sequencing (analyzing genetically-carried diseases) and developing personalized medicines to counter its effect. Several startups as well as renowned biotech companies, those involved in genome sequences have already received 100’s of millions in funding from venture capitalists and large fund pools.

While genomics is witnessing a boom time, there are increasing amounts of research projects that are finding it hard to get funding or traction from the general public. The challenge for researchers are a plenty, including:

(1) Not being-known to socialize much, more so with the general public, researchers find it hard to communicate the importance of their research.

(2) Tax-payers rightly seek more transparency, which includes wanting to know the kind of projects where their money is being invested in.

(3) While scientific journals are designed for the scientific community, the common citizen, including children, require more outlets that shared research information in easy-to-understand terms.

(4) To help funders realize that many research projects take a longer time that, for instance a web startup.

(5) Many research projects turn out to be unsuccessful in the end and that in most cases, the learning alone is crucial for future research.

And so we ask, is crowdfunding good for science research?

Welcome to CrowdNavigator

So, what is Crowdfunding?

Welcome to the first worldwide matchmaking site for people looking for a suitable crowdfunding model and for funders who want to invest in good projects.

Crowdfunding essentials

Crowdfunding enables people to invest and contribute monetarily in various denominations to projects they wish to support. Crowdfunding is normally done via an online tool or platform. [Vinay Dora Kandiyanallur]

Crowdfunding describes the collective cooperation, attention and trust of people who network and pool their money and other resources together, usually via the Internet, to support efforts initiated by other people or organizations. [Wikipedia/Crowdfunding Law & Legal Definition US]

Financial contributions from online investors, sponsors or donors to fund for-profit or non-profit initiatives or enterprises. 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. [Industry website crowdsourcing.org]

Four types of Crowdfunding

BORROW Crowdfunding – funders microfinance projects in return for a small interest on the amount. E.g. Kiva, LendingClub.

CLICK or social button Crowdfunding – funders pay websites, blogs, videos, etc, through a social button added to the page. E.g. Flattr, Kachingle

DONATION Crowdfunding – funders pledge money in return for goodies or just goodwill. E.g. Kickstarter, Indiegogo.

EQUITY Crowdfunding – funders are offered equity stake in the company in return for capital. E.g. GrowVC, Crowdcube.