Facebook’s new crowdfunding tools challenge Kickstarter

By Ho Young Won, Freelance Writer for Polaris Office

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This week, Facebook announced new tools for nonprofit organizations to fundraise more easily on the social network. These tools allow organizations to host crowdfunds within their Pages and posts. The new features closely resemble the likes of Kickstarter and Indiegogo which may be Facebook’s intent to enter the crowdfunding market.

With an improved Donate button available for nonprofit Pages and posts, users will be able to donate without having to leave Facebook. These fundraising Pages will also display the amount of donations that have been collected and the goal that has to be met for the fundraiser to be successful. These features already sound a lot like the process of other large crowdfunding websites such as Kickstarter and Indiegogo. The similarities raises the possibility that if Facebook were to be inclusive of for-profit organizations, the social network will be a viable competitor for crowdfunding against Kickstarter and Indiegogo.

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Facebook is emphasizing on the fact that other online fundraisers and crowdfunding events are hosted on other websites but are always shared on social networks. This requires several clicks to make a simple donation. The purpose of these new tools is to minimize the process into a one-click relationship between the fundraisers and the givers.

If this simplified relationship catches on, Facebook has the potential to become the largest crowdfunding source in the world.

Facebook emphasizes on their exclusive focus on nonprofits, however, that is highly unlikely to stay in the long run as the revenue potential is too big to ignore for the company. But for now, the new tools are exclusive to nonprofits so the company will have to see how successful these fundraisers perform before making any moves.

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