In with the in crowd

It was once a case of hoping for a sympathetic bank manager to back the next big idea.

Now everyone from scientists to artists is turning to crowdfunding – appealing on the internet for ordinary people to back their dream project with cash.

One of the world’s largest crowdfunding websites launched in the UK just six months ago. In Scotland, 32 projects have so far raised nearly £700,000 on Kickstarter.

Two-thirds of Scottish projects reached their fundraising target, better than the 45% overall rate.

On Kickstarter people give money to a project they like in return for a reward, such as a T-shirt or a name in the credits of a project. Other crowdfunding types include individuals lending money, with the aim of getting the money back plus interest, or buying shares in a business.

Tim Wright, director of social media research firm Twintangibles, said crowdfunding was “taking off” in the UK, thanks to factors such as a lack of funding from the banks and greater access to technology.

Scotland’s first equity crowdfunding website – which offers shares in return for investment in companies – will be launched next month.

Jude Cook, founder of, said: “Instead of getting one big investor investing £200k, why not get 200 people investing £1000 or 2000 people investing £100?”

Here we look at some of the Scottish projects that have used Kickstarter.


AS the opportunity to display the results of years of honing their creative skills, the degree show is crucial for arts students. Final year Communication Design students at Glasgow School of Art – which include graphic designers, illustrators and photographers – decided to use crowdfunding to raise extra money in addition to that provided by the university to develop their show.

The successful project will enable them to redesign their exhibition space at the Glasgow School of Art in June and take the show to a wider audience in London later that month.

Alice Gordon, 23, who studies photography, said: “Degree shows are usually a very standard format, but this year we said we want to redesign it and find a better way of showcasing our work. It was the really generous donations that helped.

“There was one lady who gave us the bulk of the money and she was local, so it was really nice that we found local people who were interested and supporting what we do.

“We even got a £100 donation from someone in America who was into supporting creative projects – it was great to be able to reach an audience that we just couldn’t reach otherwise.”

Jules Gay, 23, an illustration student, said: “The one thing we need to do every year is print catalogues for the degree show and that is obviously a rather expensive business.

“I think just even the process of crowdfunding gives you a lot of confidence that people believe in you enough and want to see what you are going to do with this money.”

TARGET: £2000

RAISED: £2127 achieved April 29

Rewards offered: Badge and postcard for £1 to mounted digital print for £500


A year after Elaine Mason, 47, set up her Union of Genius café in Edinburgh – which specialises in selling soup – she found she was increasingly being asked to provide supplies for other local businesses, and realised she needed to expand.

Instead of risking high fees and facing possible rejection from banks, she decided to use crowd-funding to raise money to set up a commercial kitchen. The project raised more than double the £10,000 target, with the extra money now used to fund a weekly donation of 30 litres of soup to a charity project in Edinburgh.

Mason said: “I liked the whole community aspect of crowdfundng, as that is what I have tried to foster with the soup café itself.

“For example our recycling campaign, which is one of the first of its kind in the UK, encourages people to bring back used packaging and we reward them for it.

“I did have doubts about crowdfunding: after all, we are a business. We are not a charity and not doing this for anybody’s good, if you like.

“So we were asking people for money to help expand our business. When people instantly started to donate money, I was just blown away. It really was amazing.”

Mason said a key aspect of her success was to make people feel involved through frequent updates, photographs and rewards.

She added: “The whole thing is a lot of work, you can’t just sit back and say okay, I have put up the page, let the money roll in,” she said. “It doesn’t work like that.

“We did have funding coming in through other sources, so we weren’t 100% relying on it, but it has helped us hugely, not only financially: we feel it has given our café a lot of visibility.”

TARGET: £10,000

RAISED: £20,650, achieved by February 17.

Rewards offered: Range from a website and Facebook thank-you for £5, to free soup once a week for life for £750.


A team of scientists from Heriot-Watt University in Edinburgh has turned to crowdfunding to help develop a deep-sea diving robot to repair damaged coral reefs.

It is eventually hoped swarms of the “coralbots” will be able to scan the seabed, pick up healthy pieces of coral and move them back to a place in the reef where they will grow and re-attach.

The project, still ongoing, has so far raised around one-quarter of its £69,000 goal, which will enable a robotic arm to be attached to the prototype robot.

Marine biologist Dr Lea-Anne Henry from Heriot-Watt said they were also using funds from traditional routes such as grants. But she added: “We had such an enormous response to the project when we first started it we thought: ‘Let’s turn to the public and see what we can do with this avenue.’

“On Kickstarter you offer people rewards, so they can have the feel-good feeling, but they can also have something physical in their hand or something to interact with.

“I think having that as part of your crowdfunding plan is absolutely key.”

Henry said if the Kickstarter project was successful, it could start being tested in November.

She said: “A lot of industries have expressed interest already, including the oil and gas industry – it could be a potential way of restoring some of the habitats which get damaged when for example, they lay oil pipelines.”

TARGET: £69,600

RAISED: £17,525 with 15 days to go.

Rewards offered: Range from a certificate for £6.50, to a chance to join one of the reef restoration missions for £6500 or more.


When Edinburgh-based designer Simon Phillips, 41, tried to get banks and grants to back his idea for a new “ergonomic” design of men’s underwear, he found no-one could understand why there would be any demand for it.

But his project for British-manufactured male underwear attracted nearly 100 crowdsourcing backers in 30 days and raised more than £5000, which will enable him to put the design into production.

Phillips said: “We started on this mission in 2010 and it was a case of looking at why no-one had changed male underpants since 1920.

“Female underwear has come on leaps and bounds in the 21st century. Michelle Mone realised women have got lots and lots of different shapes going on and she created her brand. I thought it was about time someone did something like that for gents.”

Phillips said he did not expect such a positive response to his Cahoonas underwear project.

“We sold £5000 worth of pre-orders in 30 days. I am still in shock, it was totally amazing,” he said.

“You are basically opening yourself up to people and straight away you get the impetus of whether is it a good idea or is it not a good idea.”

Phillips added: “It says to the banks, ‘This is the 21st century and people are using the internet. We can back the companies that we think are good enough and we can put our money where our mouths are.’

“British industry and industry in general can only benefit from this – if the banks don’t want to lend money, we don’t need banks any more.”

TARGET: £5000

RAISED: £5182 achieved May 3

Rewards offered: Thank you tweet for £1 to tailor-made underwear for £5000 or more.


SO you have a great idea but no money to make it happen – can turning to the internet really provide the answer?

Rewards-based websites such as Kickstarter, Indiegogo and BloomVC can work well for specific projects, while a business which is already up and running could opt for loan-based crowdfunding through sites such as Zopa and Funding Circle, instead of going to a bank. There is also equity-based crowdfunding, where investors buy a small share in a business in the hope of it seeing it grow in value, with Crowdcube and Seedrs some of the biggest names in the UK for this type.

Websites may charge for listing the project or a fee when a project is successful. Most work on an “all or nothing” basis, where the project only receives funding if the target is reached within a certain time.

Julia Groves, chairwoman of the UK Crowdfunding Association, said: “It is not an exact science, but having something like 20% of the funds you are trying to raise effectively pledged in advance is a really good way to go to market.”

Groves said the average amount raised was £150,000 and the average investment between £2000 and £2500.

She added: “If you don’t raise your money, you have to think, was that a bad pitch or was it just a bad project? It is like a little test bed of customers.

“You raise your money at the same time as raising awareness of what you are doing. And if it is successful, you have this band of advocates who are massively keen for your project to succeed. “

The Financial Conduct Authority cautions that investors should understand the business or project and not invest money they are not prepared to lose, as most start-up businesses fail.

SOURCE: Herald Scotland