What Is Crowdfunding?

What Is Crowdfunding?

New to crowdfunding or online fundraising? Check out our comprehensive FAQ to get started!

Piggybackr.com is a crowdfunding website for teams of all ages and experience levels. We're the only fundraising tool that is instructional and safe for users of all ages. Set up an online fundraiser, raise money for your cause, and collect donations all in less than 5 minutes. Sign up for free.

Fundraising for MS442's Basketball Team MS 442's basketball team successfully used crowdfunding to raise money for team uniforms

Table of Contents

1. What is Crowdfunding? What is peer-to-peer fundraising?

Crowdfunding simply means raising money from a large number of people (the “crowd”), typically through the internet. It’s also known as “crowdsourcing” your funding. It’s not a new concept by any means, but it has become more and more mainstream in recent years with the rise in popularity of sites like Kickstarter and Indiegogo. People are more comfortable than ever with the idea of supporting (“backing”) projects online, and the this trend is still increasing.

Peer-to-peer fundraising is a kind of crowdfunding where you can multiply your efforts by mobilizing members of your team or organization to fundraise for you. Piggybackr is optimized for this kind of crowdfunding for teams, but also works well for individuals.

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2. What are some examples of successful crowdfunding campaigns?

Here are a few examples from our site:

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3. Why use crowdfunding instead of other fundraising methods?

Crowdfunding differs from traditional fundraising in a few key ways:

  1. You don’t have to sell anything.

    A lot of traditional fundraising ideas for high schools and sports team require selling things or providing services. While crowdfunding campaigns can offer perks for sponsorship, it’s not a requirement, nor is it expected. When they do offer perks, they are usually low-cost but have a high emotional impact to donors.

    Some crowdfunding campaigns on sites like Kickstarter are essentially pre-sales for gadgets or media. Unfortunately, some of these projects turn out to be scams, or they just fizzle before the items can be shipped. There are no guarantees that a project you back will actually fulfill the gadget they promise. Of the ones who actually ship their prizes, a lot are late. It’s estimated that 84% of Kickstarter’s top projects in 2012 shipped late http://money.cnn.com/interactive/technology/kickstarter-projects-shipping/

    That’s why at Piggybackr, we recommend giving simple but meaningful perks like a personalized thank you video, or a signed picture of your team. These are cheap, easy to fulfill, but still have a lot of value for your donors. Get creative! We’ve included some of our best crowdfunding ideas right in our tool.

    Piggybackr sponsorship perks

  2. Crowdfunding campaigns are usually run online.

    This is a big advantage for a few reasons.

    • The Internet gives you access to a wider audience.

      While your school’s bake sale and car wash are great events to get your neighbors out of their houses and build community, they are also limited in how many people they can reach. They require people to actually show up to your physical location to participate so there is a limit to how many people can give. It’s hard to sell wrapping paper to your cousin who lives three states over, and it’s impossible to wash their car.

      The best crowdfunding campaigns leverage the power and reach of the Internet to get your cause in front of your extended family and your family friends, regardless of where they live. Now your Aunt who lives 1,000 miles away can still participate and donate to your cause! And in a few rare cases, like the Pebble Watch on Kickstarter, your cause will spread virally and reach tens of thousands of people who would never have heard of it otherwise.

    • You can do outreach right from the comfort of your own home.

      Promoting your online fundraiser requires only sending emails or sharing on Facebook or Twitter. It does not require you to go door-to-door to sell coupon books or donation charity scratch cards. It also doesn’t require you to find a venue to hold a yard sale or charity auction. All you have to do is send emails, which you can do anywhere you have an internet connection.

  3. Crowdfunding is usually more profitable.

    A person can only buy so many candy bars, and most likely will buy only one or two. Your neighbor has at most two or three cars to wash. This puts a cap on how much money you can reasonably expect to raise from these offline fundraising methods.

    In the case of product fundraisers like Krispy Kreme, Butter Braid, and Smencils, a lot of the money you raise will go directly to the product supplier who takes up to 50%. This is unfavorable for both you and your donors, because most donors don’t need more donuts, bread, or color pencils, and they want their entire donation (or most of it) to go to the school or sports team doing the fundraising.

    For service fundraisers like car washes, dog washes, and yard cleaning events, you can make a decent amount of money and keep it, but you will spend a lot more time and effort.

    When you fundraise online, you are not selling anything. You are asking your supporters to give directly. Because it’s no longer seen as a transaction, people are generally willing to give more. They are no longer thinking, “I’ll pay $10 to get some cookie dough” but instead are thinking, “I should give $20 for the class so Billy can go on a trip.” Online fundraising platforms typically take a small transaction fee (usually around 5%), but it is still far more profitable than selling things. Compared to service fundraisers like car washes, you can spend a lot less of your time and raise more money, all from the comfort of your own home.

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4. What kind of people can use crowdfundng?

Crowdfunding has grown popular in part because of the mainstream media picking up stories of the runaway successes like the Pebble Watch and the Veronica Mars Movie. But crowdfunding is not just for gadget makers and movie stars. On Piggybackr, we’ve seen groups and individuals ranging from teachers to sports teams to nonprofits all successfully crowdfund. Anyone can use crowdfunding to raise money for their cause!

At Piggybackr, even kids under 13 can start a campaign (with their parent’s permission). Our platform is instructional and will guide users through the process, so it works well for people of all experience levels.

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5. What are people using crowdfunding to raise money for?

People are crowdfunding for a ton of different kinds of projects. On Kickstarter, films, music albums, physical products, and foods make up the bulk of their campaigns. On Piggybackr, we have a lot of sports teams raising money for new equipment, team uniforms, tournament fees, travel costs, and program operations. We have also seen a lot of teachers successfully run school crowdfunding campaigns for class trips, class projects, school supplies, and even school expansion. In addition, a lot of individuals have used crowdfunding for education costs, to get funding for a project, and to raise money for nonprofits and charitable causes.

Click here for some examples

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6. Who donates to crowdfunding campaigns?

In the vast majority of cases, your donations will come from your friends, extended family, and community. The most flashy and talked about crowdfunding campaigns like the Pebble Watch, Reading Rainbow App, and the Veronica Mars Movie, were able to raise millions of dollars from strangers because they had a cool product, a strong brand, and built-in fanbase. While new iPads or Raspberry Pi’s for your class might be really meaningful to you, you can’t count on strangers to care enough to give.

It’s best to tug at the heartstrings of people you know or who are at least familiar with your school or organization. There is always a chance that your project will “go viral” and spread by itself, but most likely your donations will come from people you ask directly.

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7. How do you set sponsorship levels?

There is a well-studied effect in human psychology knows as the “anchoring effect”. Studies show that when people are confronted with different options, they tend to “anchor” to other numbers they’ve been exposed to. In the case of donation levels, your lowest level really makes a difference in how much people will give! If people see that the lowest donation level is $25, that already will get their mind thinking about giving that much or more.

Because of this, we do not allow users on Piggybackr to set their minimum donation level less than $25. If people want to type in their donation amount, they can give as little as $10. The tradeoff is that in this case, you might be turning away people who don’t want to give $25, but our data shows that this is greatly offset by the increase in average donation amount. On Piggybackr, our average donation amount is $86, with some in the hundreds or thousands of dollars!

Piggybackr sponsorship levels

We recommend you to set a few different sponsorship levels, including one that is more than you would expect to get. Get creative! This is your chance to showcase your best ideas.

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8. How do you choose your sponsorship perks?

Sponsorship perks are a great way to reward your donors and keep them connected after your campaign is over. We recommend offering gifts that are low cost to you but will have a high emotional impact on the recipient.

At Piggybackr, we have a variety of suggested sponsorship prizes, such as a signed picture of your class or team, a personalized thank you note, or an update about your project. For people or businesses who are able to give a bit more, we also recommend sponsorship prizes such as having their logo on your page, and even putting their logo on your robot.

Piggybackr sponsorship perks

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9. What are the crowdfunding sites available? Which one is right for me?

Best crowdfunding sites

Here is a list of some of the best crowdsourcing sites with a brief description for each.

Kickstarter: This is currently the biggest crowdfunding platform and the most well known. It’s very popular for creative projects. A lot of their most successful campaigns have essentially been pre-sales for media or gadgets.



Indiegogo: A few years older than Kickstarter and probably the second most well-known platform. You can set up a campaign here if it gets rejected by Kickstarter since their approval policy is often less strict. They also have campaigns that are not all-or-nothing, which means you can keep anything you raise (if you’re willing to pay a higher transaction fee).



Piggybackr: The only crowdfunding platform that is instructional and guides you through the entire process from pre-launch, through your fundraiser, all the way to after your fundraiser is over. It’s also the only site that is safe for all ages (even those under 13) and one of the few that supports team fundraising.



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10. How is Piggybackr different from other platforms?

Piggybackr Screenshot

Piggybackr is the only crowdfunding platform that is instructional, safe for all ages, and team focused.

  1. Piggybackr is instructional.

    We have many features built in to help fundraisers of all skill and experience levels get up and running quickly. A lot of crowdfunding campaigns fail simply because the fundraisers don’t know the best practices. Our product is constructed from the ground up with the best practices in mind, collected from our years of experience helping real users raise money.

    In addition, our resources will teach you the art of fundraising: how to tell your story, engage your audience, and communicate effectively. All of these are important skills (and not just for fundraising).

    We even have an app that was featured in Edmodo, just search for “Piggybackr” in the Edmodo App Store.

  2. Piggybackr is safe for users of all ages.

    We’ve had users ranging in ages from six to sixty successfully raise money on our site. We believe that it’s important for parent’s to be involved in their children’s fundraising efforts and to know what they are doing online. So we have a lot of features that empower parents to keep tabs on their kids and review and edit their children’s pages. No user under 13 can launch their fundraiser without getting a parent’s permission first.

  3. Piggybackr is great for teams.

    The most successful fundraisers rally the entire community. This works best when you have a group of people behind it. (Check out this section)[#q14] to learn more about the built-in features we have just for teams.

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11. Is crowdfunding safe for kids?

Yes! On Piggybackr, we take privacy and safety very seriously. Kids under 13 can fundraise on PiggyBackr but can only launch their pages after they have their parent’s electronic approval. The only information that shows up on a fundraising page is their first name, information they share about their fundraiser, and a related picture or video. Parents of users under age 13 are given full capability to review the page before anything is posted publicly. Parents can edit and review their kid’s fundraising page and account information at any time.

Piggybackr also restricts communication from strangers to our users. Although most fundraiser supporters are people from your direct network, there is no way for individuals viewing the page to message the child. Supporters who have donated may leave a comment on the page when they give but they are identified by their first and last name and the contents of their message is public.

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12. How do I bring crowdfunding to my school or sports team?

See our detailed guides for bringing crowdfunding to your school and to your sports team.

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13. Is crowdfunding good for teams?

Absolutely! Crowdfunding is a lot more successful when you get the whole team involved.

  1. You’ll have a wider reach.

    As a single person, you can only reach out to so many people. When you enlist the help of your whole team, each person will be able to reach out to their own network of friends, family, and businesses. The more team members you have, the more people will know about your fundraiser and donate.

  2. Friendly competition keeps people motivated.

    Giving a prize to the team member who raises the most money or sends the most emails can reward effort and make the entire team more effective. You don’t get that when you crowdfund by yourself.

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14. How is Piggybackr optimized for teams?

Piggybackr has a lot of great features built into it to make raising money with a team fun and effective.

  1. Team members can get set up in just two minutes.

    After the team leader sets up the main fundraising page, team members can start sending emails in as few as two minutes. If they want, they can further customize their page, but everything is optional. If they prefer just to get started with sending emails, they can do so right away.

    With the quick customization options, team members can easily add their own pictures and tell their story in their own words on their page. People are much more likely to give when they see a picture of the recipient’s face, not just a team picture.

    School Fundraising Website for Teams

  2. Team leaders see an overview of all the team members.

    On the “Manage Team” page, team leaders can see exactly how each team member is doing compared to the others, who has sent the most emails, and who has not yet started emailing. Thanks to our “Effort Points,” they can see in general which of their team members are putting in the most work because it’s important to reward dedication, not just money raised.


  3. Notifications make it easy to communicate with team members.

    Our intelligent notifications alert the team leader (in a friendly, low-key way) which of their team members have not started emailing or have not posted updates recently. The team leader can then send a quick note to these team members with just the click of a button.

  4. Friendly competition keeps everyone motivated throughout the campaign.

    Team members can see which of their friends has raised the most money, and which has sent the most number of emails. If the team leader chooses to set a prize for the team member who shows the most effort, this can help foster a sense of good-natured rivalry, which will make everyone a better fundraiser.

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15. How do you raise money with crowdfunding?

On Piggybackr, we’ve made crowdfunding easy - just follow these 3 steps!

  1. Assign your team leader

    Every team needs a leader to make sure everyone is on track. This leader can be a coach, teacher, a responsible student, or anyone who will look over the fundraiser. They will be in charge of making sure the whole team is participating in the fundraiser and that everyone is working towards the goal.

  2. Get your organization involved

    Have everyone join the team fundraiser. The more the merrier! This might be your class, if you are fundraising for your school, or your school club. If you work together as a team, you will raise all the money you need in no time.

  3. Get the word out

    No one is going to give to your fundraiser unless you tell them about it, so you will need to promote it to anyone that might want to help. Email your potential supporters letting them know about your team fundraiser. Post about it on social media and hand out fliers to local businesses. The more people who see your fundraiser, the more money you’ll raise!

    Piggybackr Email Window

    Online fundraising websites like Piggybackr have a built in emailing tool that will help your team create a donation request letter for your donors and send it to all of them at a click of a button. It saves a lot of time and energy for your group.

Need more information? Check out our easy crowdfundng guide here on Piggybackr.

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16. I’m ready to try crowdfunding. How do I get started?

It’s easy. Just click here to get started for free.

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