The Power of Community Funding: A Historical Look at Crowdfunding

Although  the  term  crowdfunding  only  made  it  into  the  dictionary  in recent  years,  the  activity  of  crowdfunding,  or  funding  from  the  crowd, the  masses,  the  community,  is  hardly  new.  It's  been  going  on  for centuries  in  various  forms,  long  before  the  internet  ever  popularized crowdfunding  portals  like  StartEngine,  GoFundMe,  and  Kickstarter.  In fact,  one  of  the  most  famous  crowdfunding  campaigns  occurred  nearly 140  years  ago  in  America.  

The  year  was  1885  when  a  gift  from  France  arrived  in  New  York Harbor. This  was  no  ordinary  gift.  This  was  a  gift  that  went  on  to become  the  world's  most  recognized  symbol  of  freedom.  Of  course,  I  am talking  about  the  Statue  of  Liberty.  But  what  most  people  don't  know  is that  when  the  Statue  of  Liberty  arrived  in  New  York  in  June  of  1885,  it arrived  in  pieces.  Its  pedestal  was  still  under  construction  and  needed funding  to  fully  assemble  it.  A  newspaper  publisher  named  Joe -  Joseph Pulitzer  believed  that  he  could  raise  the  money  as  a  community  effort. So  he  launched  a  "crowdfunding  campaign"  in  his  newspaper,  The  New York  World,  in  hopes  of  funding  the  completion  of  Lady  Liberty's pedestal.  

Pulitzer  advertised  his  crowdfunding  initiative  in  his  paper  by  stating, "The  world  is  the  people's  paper  and  now  it  appeals  to  the  people  to come  forward."  and  raise  the  money.  Let's  not  wait  for  the  millionaires to  give  us  this  money.  

"It  is  not  a  gift  from  the  millionaires  of  France  to the millionaires  of  America,  but  a  gift  from  the  whole  people  of France to  the  whole  people  of  America."  

Pulitzer offered  rewards  to  those  who gave  money,  as  well  as  printed their  names  in  his  newspaper.  He  often included  details  that  they  had sent  him  about  why  they  were  donating  or how  they  had  come  up  with the  money. And  contributions  came  from  all kinds  of  people.

 They  came  from  businessmen,  street  cleaners,  even  young  children.  And  most  of  those  who  donated,  donated  less  than  $1  each.  

In  a  matter  of  five  months,  more  than  160 ,000  members  of  the community  came  forward  and  contributed  to  Pulitzer's  crowdfunding campaign,  which  ended  up  raising  $101 ,091  in  total.

That's  more  than  $3  million  in  today's  dollars  accounting  for  inflation, and  it  was  just  enough  money  to  complete  the  construction  of  the  base of  the  Statue  of  Liberty.  

Today,  nearly  140  years  later,  Lady  Liberty stands  on  that  crowdfunded pedestal,  symbolizing  a  beacon  of  faith and freedom  and  demonstrating how  small  financial  contributions  from  the community  can  make  an enormous  impact.  

And  Pulitzer's  original message  continues  to  echo  throughout  modern crowdfunding  campaigns as  companies  all  across  America  look  to  their communities  to  capitalize their  growth  instead  of  to  just  a  few millionaires  or  financial  institutions.

Nowadays,  businesses  reward  small  funders,  many  of  whom  are  their customers,  with  an  equity  stake  in  the  business  or  with  interest payments  in  exchange  for  their  capital.  And  as  a  result,  the  business receives  the  capital  it  needs  to  expand,  and  the  community  of  customers receive  better  products  as  well  as  an  economic  stake  in  the  growth  and appreciation  of  that  business,  making  it  a  win -win  for  everyone involved.

At  Worthy,  we  believe  that  crowd  or  community  funding  can  not  only be lucrative,  but  very  impactful.

We  invite  you  to  learn  more  at WorthyBonds .com.