How to crowdfund a million-dollar arts project
I was sad to note today that, with 14 days to go, The New York City Opera has raised less than 10% of the $1 million the organization aims to crowdfund via Kickstarter this month.
The 'People's Opera' has struggled in recent years. It closed its doors in 2008 for a refurbishment that coincided with the Financial Crisis, and has struggled to make ends meet since then. Organizers describe the crowdfunding campaign as 'urgent', but it's only a slice of a larger call for $7 million by the end of September. If the overall campaign fails, the 70-year-old Opera will suspend its program after the first opera of the season, Anna Nicole. As of 6pm on Monday, the outlook for the crowdfunding portion of that goal is not good - Kicktraq’s trend algorithm projects an endpoint of around $250,000.
So what’s the problem? Another New York institution, Spike Lee, just raised $1 million. Last year 17 projects raised $1 million, and already this year 30 projects have surpassed that target. But the story is very different in the world of theatre and dance. Despite having very strong success rates (74% for dance and 66% for theatre compared with an average success rate of 43% across all categories), these sectors are not yet crowdfunding at scale. The Opera’s campaign target is six times the previous high for Kickstarter in the theater category, and almost twice the previous high in the broader arts category.
Even in an urgent situation, $1 million is a big ask for an arts project. But what would it take to get close to that target? I'm no authority whatsoever on the Opera's history and its viability, so my comments here relate specifically to the crowdfunding initiative. I decided to compare the Opera’s campaign with that of the most successful arts campaign to date, The Marina Abramovic Institute, which raised $661,452 less than a month ago.
It’s a useful comparison for a few reasons: both campaigns are by well-known arts brands located in New York City, fundraising within a few weeks of each other. Abramovic is a Serbian performance artist who has been active for three decades; The NYC Opera has been operating for 70 years. The NYC Opera backed the Abramovic campaign. Of course, Abramovic was asking for $600,000 rather than $1 million. But with the NYC Opera seeming unlikely to raise even a fraction of Abramovic’s total, we need to look beyond the target amount.
So let’s look at the pledgers. As you might expect, assuming a similar demographic for the two campaigns, the average pledge to the campaigns is similar - the mean pledge for the Abramovic campaign was $139 compared with a current mean of $125 for the NY Opera. But that’s where the similarity in pledging activity ends.
Numerous crowdfunding practitioners have stressed to me the importance of rewards. As I’ve written previously, in a consumer-focused campaign, the most popular pledge level is typically close to the purchase price of the item - and at that level, the pledger receives the item. In other words, it’s a pre-sale, either with a small premium added for the privilege of receiving the item early or a discount awarded for committing to buy before the item hits the market. For a group such as NYC Opera, the obvious anchor reward is tickets to the performances. The campaign currently has them at several levels, including premium seats at the higher levels. So far, so good.
But the problem with theater tickets is that they are in-person rewards. If a backer isn’t based in New York or willing to travel there, they’re essentially useless. To raise a record-setting amount for an arts or theatre crowdfunding project surely requires a larger pool of backers than the opera fans currently residing in easy reach of New York City. That means fantastic rewards for your remote fans.
Right now, if you’re outside New York, NYC Opera is offering you a choice of a tote bag, desktop wallpaper, an mp3 playlist curated by the Opera’s artistic director and a CD or DVD. Compare that to Abramovic’s offering:
For $25, “Marina will teach the Abramovic Method SLOW MOTION WALK exercise via live stream. Receive exclusive access to this event. You, Marina, and the other backers at this level will then perform your exercise SIMULTANEOUSLY, creating a large public performance that occurs at the same time in different locations all over the world.”
For $100, “You will receive a set of never-before-seen video materials.”
For $1,000 “Marina will perform the Abramovic Method eye gazing exercise with you via webcam. You may document this experience in any way you’d like and opt to include it in MAI digital archives.”
These types of inventive digitally-delivered rewards are critical. 28.5% of the eventual funding to Abramovic’s was given by pledgers who received in-person rewards. In other words, 72.5% of the funds came from people who were not required to show up to receive their rewards.
NYC Opera’s campaign seems to be holding to a similar pattern: currently only 27% of its funding has come from backers who are due to receive in-person rewards. But the problem is that the Opera is betting that in-person rewards will have a much stronger pull than that. Let’s look at their expectations, based on the rewards offered.
For rewards where a cap is set, which applies to 21 of the 33 reward tiers, concentrated above the $100 mark, we can calculate the projected value of those rewards to the campaign - that is, make an assumption about how much the organizers believe they will raise at each level. To be sure, these may be stretch goals and would be expected to exceed the fundraising amount, but they are illustrative. In the case of NYC Opera, the total projected raise based on capped rewards is $750,000 - which doesn’t seem like too much of a stretch.
As you might expect, the vast majority of the capped rewards are in-person, since they involve physical space and people’s time. The projected raise from those capped in-person rewards is $676,875, or 68% of the total goal. That means the organizers are betting that two-thirds of their funding will come from people who are either based in New York, or are willing to travel there to benefit from a reward. The Abramovic case suggests that that’s very ambitious.
Perhaps Abramovic’s pledgers were in fact based in New York, but didn’t want to traverse the city to experience a reward? Let’s look at the pledger location information we have. It’s not a trivial datapoint to collect on any crowdfunding site without access to payment records (which can also be misleading). Of the 4,7625 people who backed the Abramovic campaign, 964 (20%) listed their location in their Kickstarter profile. Of those who listed a location, Out-of-state and international pledgers outnumber New York-based pledgers by a ratio of 3 to 1.
The large proportion of non-local backers is understandable, given Abramovic’s global reputation. But shouldn’t the NYC Opera also be looking to leverage the interest of arts supporters elsewhere in the United States and the world? The way their rewards are currently structured, there is no scope for a distant donor to give more than $500 via Kickstarter and be suitably rewarded. Arts fans love engaging with digital content, and you don’t have to be a New Yorker to want the NYC Opera to succeed. Far from it.
I don’t propose that the above analysis even begins to capture the full context of this story. Even on a great day for crowdfunding, the $1 million campaign would be a very big ask, but the Opera may have a better shot at getting there if it broadens the horizons of its campaign in the final two weeks. I’d be delighted to see that happen.
Cross-posted at civic.mit.edu