Crowdfunding—a Matter for Sponsored Research Offices?

1. National Council of University Research Administrators Crowdfunding—a Matter for Sponsored Research Offices?

2. Panelists • Natasha Chopp, Research Development & Marketing Manager, Michigan Technological University • Patience Graybill Condellone, Pre-award Administrator, Southern Illinois University Edwardsville • Jerry Weinberg, Associate Provost for Research, Dean of The Graduate School, Southern Illinois University, Edwardsville @ 2014 National Council of University Research Administrators

3. “At the end of the day, its all about the crowd.” “First the crowd, then the funding” @ 2014 National Council of University Research Administrators

4. Crowdfunding Models • Pre-sale of a product • Suits prototype development, filling the “valley of death” investment gap between discovery and commercializing a product • Donation-basedFitting for research and creative activities • Equity-based – crowdfunding toaccredited investors only • Appropriate for start-ups @ 2014 National Council of University Research Administrators

5. Issues to Consider • Assurance of proper use of public funds • Accountability and reporting? • Protection of the institution’s reputation (brand)? • Liability of the institution and individuals? • Administration of funds • Gift or grant? • Compliance issues met? (IRB, IACUC, IBC, COI, …) • Funds administered through institution’s foundation, office of sponsored projects, or both? • Administration fee in budget? • Terms of the Crowdfunding Site • Do they protect the institution’s IP rights? • Do they require a fee? Who pays for it? • Open to university community • Who may crowdfund? • Staff, administrative units, students, student organizations? • Successful campaigns require good marketing • Is there an natural or developed social network associated with the project? • Who determines what gets marketed to alumni and other university affiliated supporters? • Support for video production? @ 2014 National Council of University Research Administrators

6. Donation Models • All-or-nothing • If you don’t reach your funding goal, you don’t collect any of the donated funds • Creates urgency/need • Some offer the option to pay an extra fee to collect the donations • All-donation • All donated amounts are given to the project @ 2014 National Council of University Research Administrators

7. Outreach/ Connection • Connects the research/project creator with the community • Question/Comments section • Social Media • Donors make a difference @ 2014 National Council of University Research Administrators

8. SIUE: A Hybrid Model Approach • PI’s “route” the proposal to the Office of Research & Projects as they would for any externally-funded project: (compliance and budget) • Donated funds go to Foundation • Financial administration of the project lies with ORP • ORP connects PI with Marketing @ 2014 National Council of University Research Administrators

9. Superior Ideas Crowdfunding Site • Built internally at Michigan Technological University • Already had the donation mechanism • Resources • Researchers • Staff • Legitimacy • Experiment • All-donation based • Tax deductible EXAMPLE:http://www.superiorideas.org/projects/rooftop-veggies @ 2014 National Council of University Research Administrators

11. Some Resources: • Top Ten Reasons Crowdfunding Campaigns Fail(and What Can Bring Them Back) • www.huffingtonpost.com/lee-schneider/crowdfunding-fails_b_4171823.html • 10 Tips for a Successful Crowdfunding Pitch Video • www.tubestart.com/blog/10-tips-successful-crowdfunding-pitch-video.html • Chopp, N., P. GraybillCondellone, and J. B. Weinberg, “Crowdfunding: Navigating the New Frontier in Research Funding and Administration”, in NCURA Magazine, October/November 2013, Vol. XLV, No. 5, pp. 32-34. @ 2014 National Council of University Research Administrators

12. References Hall, Alan. “New Research Shows Optimism For Crowdfund Investing Continues to Rise.” Forbes. Forbes Magazine, 01 Nov. 2013, Web 16 Jan. 2013. Webinar by Finnegan, Farabow, Garrett & Dunner, LLP. “Crowdfunding for University Startups.” 23 Jan. 2013. Ranganathan, Jai. “Crowd-funding for Research Dollars: A Cure for Science’s Ills?” Scientific American. N. p., 23 May 2012. Web 04 Apr 2013. Wheat, Rachel, Yiwei Wang, Jarrett Byrnes, and Jai Rangnathan. “Raising money for scientific research through crowdfunding.” Trends in Ecology & Evolution. Vol. 28, issue 2. 71-72, 06 Dec 2012. Webinar hosted by Barbara Walker, Director of Research & Development at University of California—Santa Barbara. “Crowdfunding for Academic Research.” @ 2014 National Council of University Research Administrators