THE workshop is ten minutes late getting started and the flustered guest speaker apologises for a problem with the overhead projector.
Even at Summerhall, one of Edinburgh’s technology hubs, getting the simplest of things right can be so frustrating.
When a man arrives with the correct cable, the machine sparks into life and a beaming Anastasia Emmanuel is ready to roll with her presentation on crowdfunding to an audience of more than 50 young company starters. They want to know more about this relatively new method of asking lots of people to donate small amounts of cash to support their bright ideas.
It is a simple concept that has been around for a while but was first popularised via the internet in 2008 by San Francisco based Indiegogo, now the largest crowdfunding platform in the world. The three Americans behind the launch of Indiegogo wanted to “democratise finance”. It has spawned an industry of copycats so that there are now 900 worldwide offering their services to those who, in the main, are start-ups struggling to get finance from traditional sources. Crowdfunding is gathering some traction in the technology sector – hence the venue for last week’s workshop – but is being used to fund anything from an art installation to a heavy metal band’s next album.
The internet gives those developing an idea instant access to a global pool of funders who will pledge any amount they like, even £5 if that is all they can afford. The funders are usually people who have a passion for a project and just want it to succeed.
Emmanuel is Indiegogo’s only UK employee and has been on a UK tour of ten cities, ending last week in Edinburgh. She has been promoting GoCrowdfundBritain, spreading the word about the concept which remains in its infancy, particularly beyond the big cities. In Scotland, the aim is to get at least 100 campaigns off the ground before the end of the year and for each to raise at least £1,000 to turn that idea into a reality.
“It is a nascent industry and people don’t really know about it, or don’t fully understand how it works,” she says. “It has been pretty exhausting. I’ve travelled two and a half thousand miles, but it’s been worth it.”
She speaks quickly and with the enthusiasm of an evangelist. There is an ever-present smile and she laughs regularly. Clearly she enjoys her job and is a big believer in the idea. Emmanuel, 28, is based in London but hails from Yorkshire and comes from a business background. She briefly ran her own company. “I didn’t think I would own a company because I have seen from my family how hard it can be,” she says. “I left my company. It didn’t go right, but I learned a lot.”
A friend heard that Indiegogo was looking for someone and last November she was appointed UK marketing and community manager.
“I work many hours because I love it. It may sound corny but I just like seeing other people achieve their dreams.”
While remaining a simple concept the platforms promoting crowdfunding are now becoming a little more sophisticated, some offering equity-based schemes. They publicise ideas on their site and invite cash donations. Campaigners pay a fee (a sort of commission) while those who support them do not expect a return in terms of interest or a dividend. They are offered “perks” which might be nothing more than a free ticket to a company or event launch party. In general, money comes from those who simply want to see someone’s idea come to fruition.
Emmanuel tells the story of an Australian film maker who wanted to raise money for a make-up artist for a zombie movie. “For A$200 he offered the opportunity to be a zombie and for a thousand they could be killed. That’s when the money came in.”
It is not an infallible concept. Crowdfunding often supplements rather than replaces other forms of fund-raising and if targets are not reached the funds go back to the donors. The biggest sum raised so far on the platform was $12.8m (£7.5m) from 27,000 people who backed a new smartphone billed as the next big thing. It did not reach its ambitious $32m target but the team behind it switched to another manufacturer and is due to launch a scaled-back version in September. The team did not get to keep the $12.8m but did capture 27,000 e-mail addresses for marketing.
“Crowdfunding can work hand-in-hand with traditional funding because it is challenging to raise really big sums this way,” says Emmanuel. “But some campaigns that set out to raise small sums eventually raised many times their original target.”
One example is Edinburgh-based Tens, a firm created by Marty Bell, Tom Welsh and Kris Reid, who have developed sunglasses that marry up with Instagram technology. They set out to raise £9,400 and closed the campaign with £367,000.
“I was supposed to meet them, but they have flown to New York at short notice to meet an investor who is keen to talk to them,” says Emmanuel. “The beauty of crowdfunding is that those who provide the money usually turn out to be the customers. It is a way of testing whether you have a market.”
Job: UK marketing and community manager, Indiegogo.
Born: Harrogate, Yorkshire.
Education: Queen Mary’s School for Girls, Thirsk; Leeds Girls’ High School; Nottingham University: American Studies; One year at the University of Illinois.
First job: Scheduling adverts for Sky in London.
Ambition while at school: Something involved in public presentations.
Car: No car.
Interests: Food and travel. I have visited 12 countries on my own.
What makes you angry? Small mindedness.
What is your biggest fault? I am passionate and get too attached to things. And I speak too quickly.