By James Parkinson | 27 March 2019

It is well known that in order to create sustainable change and improvement in an area, the local community should be engaged and involved in the process. In reality, this can often be a difficult and challenging feat. Barriers to funding and support for local initiatives can mean that even the most fantastic and innovative grassroots ideas can fall flat at the first hurdle.

Communities are well placed to understand local challenges and throughout our work, we have witnessed people contribute innovative solutions to problems they are passionate about.

To create more space for these ideas, in 2014, the Greater London Authority (GLA) established Crowdfund London. Developed in partnership with civic crowdfunding platform Spacehive, the programme allows communities to come together to propose and deliver new ideas to improve their city and allow London City Hall to pledge public funds to live crowdfunding campaigns.

The decision to use crowdfunding brought about two important changes that allowed our work to have lasting impact. First, it incentivises collaboration to bring people who would not normally work together, harnessing different skills, experiences and resources to do something positive for their neighbourhood. And secondly, it opens up the possibility of funding going to organisations who have previously struggled. Anyone can participate, provided they are an organised group with a registered collective bank account.

Ideas can then be presented and developed in public and projects that succeed in catching the attention of local communities can be developed and delivered by people in that area.

Crowdfunding offers the opportunity to create a model that promotes local engagement and collaboration around developing grassroots projects. This has real value for local authorities who want to explore new ways to engage citizens.

We took an agile approach to developing the programme, beginning with a pilot and refining the process.

At the time, Nesta had been developing research around the emerging crowdfunding sector and was experimenting with its own match-crowdfunding programme. It was useful to share experiences at early development stages to better understand the wider value and limitations of using public funding in this way.

For Crowdfund London, each campaign can access a potential of a £50,000 pledge from City Hall and we will usually pledge no more than 50% of a project budget. However, we sometimes do go up to 75% to support projects with widespread community support but which are limited in their financial means. The flexibility of the model means that you can decide how to structure the programme. For example, we have chosen to focus on projects that are innovative and aspire to achieve a wider social good.

We have found this approach had a considerably positive impact on our work. The ability to digitally engage with such a vast audience is at the heart of the success of crowdfunded projects – no other model would allow us to have done that.

To date, we have pledged over £1.8m to 100-plus successful crowdfunding campaigns across the city and nearly 14,000 backers came together to raise an extra £2.2m in pledges towards these projects.

Our projects have varied immensely: everything from a self-built community space in Lewisham to renovations and an independent art deco cinema in Dalston, to a library of things in Crystal Palace.

From our experience, the important lesson for other local authorities is to be clear about your objectives – and it is important to test and refine the approach. It won’t always be straightforward to adapt existing processes to new models of finance and digital platforms, but the benefits to us have been worth the efforts to bring people across the organisation with us.

We believe the public sector plays an important role in enabling civic projects to come to fruition in this way. We have a responsibility to focus on social impact and inclusive proposals and this helps to ask important questions of this emerging model and the technology that supports it. By getting involved, we can all help shape a series of effective tools that work for citizens and deliver meaningful outcomes.

James Parkinson is programme manager for regeneration and economic development at the Greater London Authority (GLA)