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I just hopped off of an hour long webinar with Fracturaed Atlas, a non-profit that lends it's 501(c)3 status to artists and organizations with an artistic scope. The sponsorship allows the individual or organization to accept cash, in-kind and grant donations while allowing their donors the benefit of a tax deduction. They make it pretty darn easy too.
As the production of my musical draws near, it would be very nice to receive in-kind donations from local businesses to offset the costs of supplies. Things like lumber, food for concessions, fabric for costumes and music equipment are going to be needed moving forward and if we could receive these items without paying too much out of pocket, it would really help our bottom line.
Until a few weeks ago, I wasn't even aware that organizations like this existed. It is a very cool way to up your game when soliciting donations for projects. There is a small downside though, applying and receiving the sponsorship costs 7% of all donations, including in-kind donations received and does require a $10-$20 a month membership. They do, however, have their own crowdsourcing platform , cheap insurance and ticketing software that doesn't charge the audience a huge amount of money in fees so those are some great benefits for services that I'm going to need to pay for at some point anyway.
I did some research on other crowdsourcing websites and found that Kickstarter charges 5% of total funds raised AND 3% plus a $.20 transaction fee per transaction. That's over 8% plus transaction fees, and, to be honest, the way they present the numbers seems super shady so I wouldn't be surprised if there were other hidden fees. Indiegogo was even higher with 5% of total earnings plus 3% and .$30 per transaction. Facebook Fundraisng is not much better as they charge 6.9% and $.30 per donation. Gofundme seemed to have the best rates at 2.9% and a $.30 per transaction.
The only difference really between crowd sourcing through these platforms versus Fractured Atlas is that Fractured Atlas lets your donors write-off their donations. This is pretty huge because some businesses and organizations will only donate to non-profits because they need the tax write-offs for their business expenses.
I am not sure how much crowd-sourcing I'm actually going to need to do as I am fortunate enough to have an investor who is helping with many of our initial costs but it seems like a no-brainer to apply for a fiscal sponsorship through Fractured Atlas and start receiving donations right away.
The only thing that is somewhat concerning to me about working with them (other than there is a degree of paperwork and administration duties involved) has to do with accepting in-kind donations. You will be charged 7% of the value of the in-kind donation received and they will either take it out of the funds raised or off the credit card on file. The value of these in-kind donations will also show up on your 1099 MISC paperwork so you will be on the hook for paying taxes on all donations received. It's a little intimidating but I think it is still worth the risk.
I think I'm going to apply today.
Here is a link to their fiscal sponsorship program if you are interested in using it to fund your projects as well.
http://www.fracturedatlas.org/site/FiscalSponsorship
I will keep you all posted as I move forward with this endeavor and share with you my experiences, good or bad, as they unfold.