byAlessio Barollo, architect

Daniela Castrataro, twintangibles

The report has been kindly translated by web-translations.com

Introduction................................................................................................................................

1. Origins and Principles of Crowd-funding................................................................................ 1.1 Origins........................................................................................................................ 1.2 Principles....................................................................................................................

2. Civic crowd-funding platforms, how they work and their trends............................................. 2.1 How they work........................................................................................................... 2.2 Civic crowd-funding models....................................................................................... 2.3 Trends........................................................................................................................ 2.4 Platforms....................................................................................................................

3. Examples of contemporary crowd-funding.............................................................................

4. Thesis..................................................................................................................................... 4.1 Conditions................................................................................................................. 4.2 How it works.............................................................................................................. 4.3 Model........................................................................................................................

5. SWOT Analysis......................................................................................................................

Conclusion.................................................................................................................................References................................................................................................................................

5

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17171920

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04

C D E F G H I J E K G DIn this short paper, we aim at presenting both a new type of the wider phenomenon that is

crowd-funding, known as “civic crowd-funding”, and a proposal for feasible active citizenry.

The fi rst aim of this paper is to put forward a feasible use of civic crowd-funding within the national territory [Italy],

rather than offering a fruitless analysis of this phenomenon. However, in order to put forward a proposal with solid and

factual foundations, we included a rather detailed analysis of this phenomenon. We started from the origins and principles

of contemporary civic crowd-funding, and later described the world’s major existing platforms, how they work, the models

they follow and the upcoming trends. We only presented a few platforms, both because this phenomenon is new and

because of the limited scope of this paper. After a brief overview of projects that used civic crowd-funding, we put forward

our proposal, stating the basis and way of operating of a certain model of civic crowd-funding which in our opinion could

be reproduced in our country. This way, a process which both addresses the scarcity of capital in local administrations and

brings citizens closer to institutions would be created, thus increasing people’s respect for public assets and implementing

a model of active citizenry and collective innovation. If this model were put into practice systematically, it could place Italy at

the forefront in this sector as regards the possible future developments of civic crowd-funding, making it a model for other

countries, especially in Europe. We hope to offer a useful and inspirational read for many to put into practice our theories.

Alessio Barollo

Daniela Castrataro

05

Introduction

L M L N O P Q P R SDuring April 1968, the Computer Graphics in Architecture

and Design conference took place at the University of

Yale. Here a group of experts came together in order to

assess the changes the use of computers would bring to

the job of architects. Among the participants were Steven

Coons, Bruce Graham, Carl Steinitz, David Evans, Nicolas

Negroponte from MIT, Charles Moore from the University of

Yale, Louis Kahn, Eric Teicholz from Harvard and Warren

McCulloch. After an initial uncertainty, the majority of the

participants agreed that computers could become a useful

tool for projects. Not many know this, not even among the

experts, but in those days civic crowd-funding relative to

urban planning was being born at Yale, even though it

acquired this name many years and many megabytes later.

A new urban development model was born from the minutes

of the conference: this model also put the environment

and the people at the heart of a project, rather than just

the designer and the physical system he works with.

Negroponte states that “thanks to new processes, it won’t

be the architect and his personal and cultural experiences

who imposes the project upon the users. Rather, it will

be the users themselves, aided by new technologies and

machines that turn into a collective mind, who lead the

project. This way the project goes defi nitively from being

a product to being a process. People are no longer seen

only as end users but rather as sources of ideas. The

combination of ideas, innovation and creativity, together

with new technologies, results in a horizontal process.

Both organisations and groups of private citizens have

attempted to involve public administrations in oft-

neglected collective projects, creating an active planning

which is based on the above horizontal structure. We

live in a time in which information technologies and

social networking have been moulding our minds,

T U V W V X Y Z X [ \ U V X ] V \ ^ _ Y ` a ] V b V ] ] U ` c [ a d X [ V X We fmaking us aware of our ability to partake in the betterment

and renewal of society. The potential of web 2.0 is fi nally

turning into powerful offl ine collaborations. Applied to urban

planning, this means that citizens can be directly involved

in the formation of processes, services or real public

infrastructures in a coordinated and collaborative way,

whilst being fully aware of having the right tools to do it.

Italy currently has the right infrastructure to be able

to develop such methods. Civic crowd-sourcing could

develop in our national territory into crowd-funding, namely

fi nancial crowd-sourcing, which would address the issue

of scarce public funding. Crowd-funding has existed for

a few years and has been developing greatly, becoming

more and more complex and elaborate. Crowd-funding

is part of a phenomenon which takes online communities

offl ine, turning them into stronger forms of cooperation

and participation: one of its natural developments

is the phenomenon known as civic crowd-funding.

06

origins

of the pedestal which was to support the statue itself.

The situation stalled until the media tycoon Joseph Pulitzer

raised the public’s awareness through his newspaper: he

encouraged the citizens to donate in order for the public

work to be carried out. A hundred thousand dollars was

raised in 5 months, collated from 120,000 micro-donations,

thus allowing for the statue to be placed in New York Bay.

There was also another result, which is as important:

the local community started to feel particularly

attached to this symbol because they had actively

contributed to its realisation, actively cooperating with

the public administration which was managing its use.

In line with civic crowd-sourcing, civic crowd-funding

is defi ned as the collective fi nancing of public works

and projects, which is not included in the budget of the

relevant governmental bodies or local administrations.

It is carried out by citizens, organisations and private

businesses, which sometimes co-fund the works together

with the local authorities themselves. This new model of

distributed microcredit is not really a new practice. Let’s

go back to the USA, this time to New York: in 1884 the

French were about to send the Statue of Liberty to the

United States, however the American Committee had

not allocated all the necessary funds to the construction

07

g h i j k l m n l o p q rWe can ascribe the origins of modern civic crowd-funding (not

contemporary, as it naturally did not make use of the web 2.0)

to this short anecdote, as it presents some of its core aspects:s t u v w x y u z{a scarcity of public funds;s t u | u w } y ~ � } � u } s � � u y z{

an emotional bond

with the territory, the local community and the public

good, which comes from projects of a civic nature;s t u � u y x � s z{ a strengthening of bonds in the community

and a higher sense of belonging towards public places

on the citizens’ part, with a consequent heightened

sense of respect and willingness to preserve them.

Nowadays, we can fi nd all these elements together with

an ever increasing distrust and loss of connection on the

citizens’ part towards local administrations. The example

of active citizenry found in the case of the Statue of

Liberty has evolved into civic crowd-funding. This is in all

respects a form of active government, through which the

citizens decide where and how to invest money to improve

communities and neighbourhoods. This happens through

project proposals, voting and petition mechanisms, and

naturally relies on the funding itself. Furthermore, thanks to

the web 2.0 and to the social nature of contemporary civic

crowd-funding, we also have another essential element:

transparency. People have (or at least could have, and

certainly demand) access to all the information on how the

money is utilised. Moreover, the way crowd-funding works

allows citizens to have a tangible return for the offer they

made to help carry out the public work thanks to reward

systems (or interest, in the case of civic social lending, as

we will see later). These rewards are naturally on top of

the reward of a better community, which is intangible and

less immediate but factual nonetheless. The internet tends

to make us forget about the importance of our location. We

can communicate, interact and work online with anyone,

but this does not mean that we have a real relationship.

Local communities can encourage collaborations and

innovation, bringing online communities offl ine. If a small

business or a local project is looking for funds, it is unlikely

they will fi nd them in the global market. Why should

someone from Buenos Aires fi nance a bakery near Rome?

This is even more obvious if we talk about civic crowd-

funding: there are a lot more opportunities and it is more

sensible to collect funds for a footbridge in the Rotterdam

city centre within the local community rather than calling on

the online global community. We are talking about relational

rather than social capital, and small but strong relations that

form tightly bound communities rather than large networks.

Online communities gain a new life going offl ine: online

cooperation allows for the creation and development of

strong relations that can go up a level if they transfer to an

offl ine environment. These dynamics are only possible within

limited geographical boundaries. As previously mentioned,

local communities seem to be a suitable environment

in which civic crowd-funding can fl ourish, as this aims at

fi nancing local works and projects. It is important to keep this

in mind for civic crowd-funding initiatives to be successful:

the key point seems to be both to facilitate digital cooperation

and to build offl ine relationships. According to Chance

Burnett of Crowdfunder (see references) the real power

of the crowd does not lie with people randomly connecting

on the web. The future of this technology seems to be

pointing towards local online environments that promote

strong interactions both online and offl ine. This is the future

of crowd-funding, and civic crowd-funding is the future.

08

principles

� � � � � � � � � � � � � � � � � � � � � � � � � � � � � � � � � � � � �� � � � � � � � � � � � � � � � � ��   ¡ ¢ £ ¤ ¥ ¦ § ¨ ¤ £ © ªCivic crowd-funding platforms work according to

the same basic dynamics as traditional platforms.

However, some models are favoured over others.

We will analyse briefl y a few innovative solutions

characteristic of crowd-funding in the following paragraph.

All the platforms that were analysed in the scope of this

paper adopt the “all or nothing” model: the project must

receive all the necessary funds for its completion, or else

the investors’ pledged donations will not be collected.

We can also further classify the platforms into two sub-

models, according to who can initiate the campaigns:

The project can only be put forward by local •

governments and public bodies, and at times by

private businesses, non-profi t organisations and

public sector building contractors. Citizens can put

forward petitions in some cases. This is the case

for the two major civic crowd-funding platforms

in North America, Neighbor.ly and Citizinvestor.

The project, despite being in the public interest, •

can be put forward even by a single private citizen.

An example is the British platform Spacehive.

Like in traditional crowd-funding platforms, the projects

are selected by the platform and published online. This

way the fundraising process, which can vary in duration, is

initiated. Let us take a look at its models and how they differ.

�   �   « ¬ £ ­ § ® ¯The main civic crowd-funding models followed by the

platforms examined in this short overview follow traditional

crowd-funding models: “reward based”, “donation based”

and “crowd-lending”. We haven’t found any equity based

platforms intended solely for projects of a civic nature. ° � � ± � � � � � � � � ² � � � � ³ � � � � �This model is based on emotional attachment and

ideas, as no tangible reward is given in exchange for

donations. Therefore, the success of the crowd-funding

campaign is based almost exclusively on the community’s

or individual’s emotional attachment to the project.

Whether the project’s supporters see the campaign for

the fi rst time during the fund-raising phase or took part in

conceiving the project itself, they have to have or establish

a bond with the idea behind the project. Spacehive

follows this model. Other examples of donation based

campaigns are political or charity fundraising campaigns. ° � � ± � � � � � � ² � � � � ³ � � � � �

This model takes its name from the rewards given in

exchange of a donation. This is a way of enlarging the

community related to the project by giving a further reason

to donate. However, offering a reward does not preclude

aiming at gaining people’s emotional attachment, which

should remain the essential element of the campaign.

Examples of reward based platforms are the American

Neighbor.ly and Citizinvestor. Some “do-it-yourself” (DIY)

crowd-funding campaigns belong to this group as well:

these projects do not resort to any particular platform,

rather they set up the campaign on ad-hoc websites.

09

models

´ µ ¶ · ¸ ¹ º » ¸ ¼ » ½In this model, the citizens lend money to local government,

which plan to carry out a specifi c project through a crowd-

lending platform. The loan can vary in duration and citizens

can opt for reducing or not earning any interest at all, in

order to support the community further. An example

of this is the German platform LeihDeinerStadtGeld.¾ ¿ À ¿ Á Â Ã Ä Å Æ Ç Ä È Ç É Ç È È Â Ê Ë Å Ì Í Î Ä Å Ç Ä Ï Ð Ñ Ò Ó Í Ê Â Ô ÆData from civic crowd-funding platforms and projects are still

too scarce to be able to report signifi cant trends. However,

we analysed the Spacehive platform,

which is the most substantial and active

platform to date as regards the

number of projects. Eight projects

were completed successfully on this

platform1, totalling nearly £900,000.

First of all we have to consider the

type of investors and the distribution of

donations. There seems to be a strong

prevalence of big investors, such as

institutions, organisations or private

businesses, rather than individuals. As shown in the below

pie chart, over 60% of donations come from institutions or

organisations. However, only 21 out of 315 investors for 8

projects are organisations or private businesses. This can

be explained with the amount of the average investment:

according to the data analysed, an investor donates on

average £2,842, a rather high sum for a private individual

to invest. This is of particular interest as currently a form

of match-funding seems to prevail on civic crowd-funding

platforms: the institution or organisation allocates part of

the budget for the project, whilst private

investors contribute in order to complete

the fundraising. Four out of eight projects

were put forward by private citizens, as this

British platform allows for this arrangement.

However, excluding a few isolated cases

of projects led by a private citizen and

fi nanced by private individuals2 (these

projects did not reach the total of £1,500),

Spacehive projects are mostly supported

by local organisations and/or institutions.Õ µ ¼ ½ ¼ » ¶ Ö ¸ ¶ » × Ø ¼ ¶ » Ù

Individui

Ente/Organizzazione

Individuals

Istitutions/Organisations

10

trends

Ú Û Ü Ý Þ ß à á â ã ä â å â ä ä æ ç è é ê ë ì ã é â ã í î ï á ð ë ç æ à ñò ó ô õ ö ÷ ø ù ú û ü ý þ þ þ ú ÿ ó ô õ ö ÷ ø ù ú û ü �Neybor.ly is a civic crowd-funding platform based in Kansas

City, USA. It only accepts projects from local administrations

and public bodies. At the moment citizens are unable to put

forward projects directly, however a system that receives

citizens’ projects is scheduled for the near future. This is

a reward based platform: citizens donate in exchange for

a reward. However, they can opt for not being rewarded,

thus contributing further to the campaign. In some cases,

projects hold funds before the campaign starts. Because

Neighbor.ly’s mission is also to show the full picture about

a project’s fi nances, campaigns sometimes show the total

value of a project, not only the amount necessary to reach it.� ô � ô � ô ÿ � ó � � ø ù ý þ þ þ ú � ô � ô � ô ÿ � ó � � ø ù ú � ø � �Citizinvestor is an American platform for public projects

which allows citizens to fi nance projects that have been

published by local government. These projects will already

have been assessed and approved, and they only need

fi nancing. Projects range from the building of a new park

to the setting up of fi rst aid kits for cyclists on cycle lanes.

Normally these projects have been sitting on the waiting lists

of local governments’ budget plans. Citizinvestor also offers

citizens the chance to put forward a petition for projects they

would like to see implemented and which are not included

in budget plans. Also in this case, projects are carried

out only if they received 100% of the necessary funding.

According to its website, offers made on the Citizinvestor

platform are tax-deductible, as they have a strictly

public purpose, and as such are classifi ed as donations.� � ó ö ô � ó ý þ þ þ ú � � ó ö ô � ó ú � ø � �This is a British platform which defi nes itself as “the world’s fi rst

funding platform for neighbourhood improvement projects”,

such as building a new playground in one’s own neighbourhood.

Anyone can put forward a project: citizens, professionals,

public bodies, private businesses. Projects may vary in nature,

as long as they hold planning permission. Projects go ahead

only if they receive 100% of the target funds. This platform

is donation-based: no reward is given out for donations.� ó ô ö � ó ô ÿ ó ù � � � � ó û ý þ þ þ ú û ó ô ö ó ô ÿ ó ù � � � õ ó û ú ó �This German platform is one of the very fi rst civic crowd-

lending platforms. Its mission is to support local authorities

in directly fi nancing local projects through public loans.

Through this platform, citizens are able to lend their

savings to their local administration or public body in

order to fi nance a specifi c project. The loan can vary in

duration and citizens can opt for reducing or not being paid

any interest, in order to support the community further.� � � � ù ø þ � � ÿ ô ÿ õSome civic crowd-funding projects do not resort

to any platforms, rather they rely on what is

known as do-it-yourself (DIY) crowd-funding.

11

platforms

� � � � � � � � � � � � � � ! � � � � " � " # � $ % $ �& " � ' ( � ) ( $ *+ � � , � - � ! ! � " ( � �. / 0 1 / 2 3 4 5 6 7 8 9 : ; 9< 3 4 0 = > 2 ? @ A B C D 2 > E 6 = F 5 6 G 5 H

In order to encourage the citizens to donate, every citizen

who donates is offered the opportunity to write a message,

a quote or their name and signature on the wooden boards.

Having one’s name written on a plate (€25), on a section of

the bridge (€125) or on the bridge structure itself (€1,250)

is one of the rewards. The project proceeds by stages:

when a certain amount is reached, a section of the bridge

is built. Further parts of the bridge are completed with each

subsequent crowd-funding stage. If donations carry on at

the current rate, the footbridge will be completed in 2014.

.

This project is part of a plan which aims at linking two parts

of this city which are currently separated by a congested

main road. The footbridge links the two parts of the town,

which have been reappropriated by its citizens, who are

now able to move more freely and with little environmental

impact. This is a perfect example of reward based

crowd-funding for a project which benefi ts the whole

community. So it is not surprising that a strong community

aspect featured in the media campaign, whose slogan

went “the more you donate, the longer the bridge”. The

minimum donation is €25 and the maximum is €1,250.

12

examples

I J K L M N O L P K J M Q R K N O S O R LT U V W X Y Z Z[ \ ] ^ _ ` a b c d ] e ` `

campaign was put forward on the platform Razoo (www.

razoo.com). It is possible to donate between $10 and

$2500. It is possible to help purchase tops for children in

summer camps, or pay for rangers to patrol, or even hire

local bands to provide evening entertainment in the park.

Franklin Park is one of the green lungs of Boston. The

non-profi t organisation FPC decided in 2011 to involve the

citizens in the management of public green areas, ranging

from tidiness and safety through to outdoors activities. In

order for these activities to exist, a reward-based fundraising

13

f g h i f g j k l i m n o p q r s p t k u p t vw x y z { | z} ~ � � � � � � � � } � � � � � � �

interesting for the number and variety of its supporters.

This project received only 10% of its funding through small

investors, the rest was contributed by big organisations

which were not necessarily linked to local government.

This is another interesting project, which was hosted

on Spacehive. In this case, almost £37,000 was raised

in order to fi nance the creation of a wi-fi hotspot in the

centre of Mansfi eld (UK). This project is especially

14

� � � � � � � � � � � � � � � � � � � � � � � �� � � � �   ¡ ¢ £ ¤¥ � � � ¦ § ¨ © ª « � ¬ ­ ¨ § ® ¯ ¦ ° ± ¯ ² ± ³

The Madama Palace museum in Turin (Italy) put forward an

interesting cultural project in the fi rst few months of 2013:

they intended to bring back to Turin the china that once

belonged to the Taparelli d’Azeglio family. The whole 43-

piece set was found recently after a long and careful search,

and it was on sale for £66,000, which needed to be raised

by 31st March 2013. Because of the scarcity of funds, the

museum chose to raise the money through crowd-funding,

involving the community in this cultural project. Rewards

were offered in exchange for donations: they ranged from a

mention on the website (with a €2 donation) to free access

to the museum for a year (with a €100 donation). The

sum was reached (and exceeded) a few days before the

deadline and the china set will shortly return to the museum.

12312315

´ µ ¶ · ¸ ¹ º » ¼ ¶ ¶ ½ ¾ ¿ ½ ¶ À ½ ¿ Á Â Ã ¶ » ¶ ¼ Ä ¸ ½ ÅÆ Ç È É Ê Ë Ì Í Î Ï Ð ÑÒ Ó Ê Ô Õ Ö È É × Ø Ç Ù Ú Û Ç Ù Ë Ç È Ü Ô Ê Ý Ô Æ Ç Ó Ý

The town of Oestrich-Winkel decided to resort to loans from

citizens in order to fi nance investment in the town’s Freiwillige

Feuerwehr (lit. “Volunteer Fire Brigade”), which had been

included in the town’s budget plan. These investments

will allow replacement of analog radio frequencies (which

are used in case of emergencies) with a wireless network,

within the scope of a nation-wide project. The project

was successfully fi nanced by €83,200. An overview of

the conditions on offer is reported below as an example.

Annual Interest Rate up to 0,76%Duration 6 yearsType of loan Instalment loansAvailable from 26/09/12Financed on 17/10/12Commencement of loan repayments 17/12/12Maturity date 17/12/18Commencement of interest payments 16/12/13Payment of interest Every year, in arrearsMinimum investment €100, it increases in multiples of 50Maximum investment Equal to the amount of loan remaining

16

Þ ß à á â ã ä ãAfter our analysis of civic crowd-funding and its various

forms and applications, we will now consider whether

the necessary conditions for the growth of crowd-funding

exist in Italy, and if so, which conditions are necessary

to make it grow. Finally we will put forward a model of

civic crowd-funding that is well suited to our territory

on the basis on the analysis we carried out so far.å æ ç è é ê ë ì í ì é ê îCivic crowd-funding seems to be a solution to the lack of

funds in local governments, much like crowd-funding in

a wider sense presents itself as a solution to the lack of

capital on the market. Financial problems in the budget

of towns, provinces and regions are widespread and

rooted in many places, both small and large. This situation

results in the citizens feeling increasingly distant from

their administrations, more distrustful and less respectful

of public assets: this comes mainly from the feeling of

distance towards assets that are not identifi ed as one’s

own, but rather owned by the state. On the contrary, citizens

are often socially bound to their own community: even in

the smallest of villages, organisations for the promotion

of the local area, local clubs, local football teams, local

government meetings, bars and schools are shared places

in which the community comes together to try and improve

the environment they live in. This precondition is related

to the strong bond between citizens and their birthplace,

and it offers the initial foundations for the development of

crowd-funding. However there are many problems which

are linked to crowd-funding in a wider sense and which

hinder the development of collective funding of a civic

nature. These obstacles include scarcity of information,

lack of IT literacy and lack of structures that would facilitate

a suitable and thorough spread of the web. Moreover, the

web has enabled us to carry out many things we were not

aware of being able to do before, by allowing ideas and

talent to circulate freely, and more recently by unlocking

capital through crowd-funding. However, all of this does not

happen across the board. There is still a strong feeling of

lack of empowerment and trust in our ability to improve the

community we live in. This problem should be addressed

with more digitisation, a better availability of infrastructures

and a more extensive use of the web, which could be

applied in different aspects of everyday life. Paradoxically,

the web presents itself as the new and strongest means of

association. What once used to be a meeting in a town hall

room or a walk in the neighbourhood has now become an

online forum. It looks as though it is necessary to go via the

web to be able to share, cooperate and feel empowered,

transferring these activities offl ine later. If communities

are educated on the web and how to use it, crowd-funding

will fi nd fertile ground from which to start off and develop.

12312317

thesis

ï ð ñ ò ó ô ò õ ó ö ò ð÷ ï ó ø ù ú ð õ û ó ù ò

and that these people might want to fi nance a project.

However, for bigger projects the “extended” community

might not be able to contribute the whole amount by itself.

Towns with many well rooted associations which involve

citizens on public matters (for example

the towns that follow the Agenda 213

plan) could be a fertile ground

for shared funding projects. This is

due to certain conditions found in these

environments, such as the development

of a strong bond between citizens and

their territory, the citizens’ active involvement in discussing

and giving their feedback, their willingness to cooperate

directly or indirectly with the local administration on choices

aimed at the local community. Based on our previous

observations, we can now put forward a model of civic

crowd-funding that we deem suitable to our national territory.

Another precondition for the development of civic crowd-

funding seems to be the participation of public administration

or other institutions in the role of promoters, validators and

co-investors of projects. We saw in the models above how

institutions are often the ones who put forward the projects.

Moreover, the construction of public works requires the

approval of local government in any case,

which needs to assess the projects’

feasibility. It is important that local

organisations and private businesses are

also involved. Civic crowd-funding often

requires a very high budget, which means

that often match-funding is necessary.

Crowd-funding in a general sense is based on a potentially

global audience, however local crowd-funding looks for

funds in a geographically small area, which implies a

small community in terms of numbers. On one hand it is

true that the web could put people who live far away, but

who are still bound to their original community, in touch,

Money

Passion and interest in the topic

Being happy to enter and partecipate

Asking for opinions or specifi c knowledge

Trustworthy project

Altruism

Indicators of reputation, progress, tax levels, score

Usefulmess of project for the contributors

Having a good time

Immediate feedback

Recommendation of other users belonging to the same social class

18

ü ý þ ÿ � � � � � � � � �� � � � � � � � � � � � � � � � � � � � � � �� � � � � � � � � � � � � �On the basis of our analysis and observations, we think

that the best model for crowd-funding to be implemented in

Italy is through a platform which integrates crowd-sourcing,

crowd-validation and crowd-funding. The tool we propose

is important for the social and economic development

of the community. Through this tool, it would be possible

to integrate the decisions made by the administrators

with the suggestions made by all the interested parties.

It would also become possible to increase the feedback

within local communities and give credit to their creativity.

Public administrations would be able to communicate

directly with the citizens, inform them on common choices

in a clear and transparent way, reaching a large section of

the population thanks to the internet and social networks.

Local associations could use online platforms as a place

to make themselves known, grow, interact with citizens

and put forward projects for the community’s sustainable

development. Citizens could use these platforms to give

feedback directly to the local administrators, and also to

put forward ideas and proposals for shared projects and

to fi nd interested parties that pursue their same objectives.

12312319

how it works

Let us take a look at how this tool works:

Citizens or organisations put forward their proposals 1.

for projects to be carried out in their community. Local

government can put forward projects as well: in this

case the platform is used to fi nance the project and

to understand the citizens’ priorities, thus involving the

citizens and implementing a form of active citizenry.

Projects are checked by public administrations to 2.

ascertain they are feasible. This is very important as

there is the risk that projects which are not needed

urgently or which go against natural, historical or

artistic elements in the community are put forward

and approved, in the event of total freedom for

the citizens4. A scientifi c and cultural structure

which assesses the proposals made by citizens and

organisations must necessarily exist. This structure

has to actively communicate with the parties involved

according to the principles of “crowd” methods.

After the projects are fi rst sifted through, there will be 3.

a stage in which online methods are brought offl ine (at

least until IT literacy has reached a suitable level among

the community). Projects are published on the platform

where they remain available for a certain period of time

in order to be voted on by citizens. At the same time,

the relevant organisations and groups will contribute

to inform the population through traditional means.

Projects with the most votes go through to the 4.

fi nancing stage: this is the crowd-funding stage.

If projects reach the target budget, they 5.

will be initiated by the administration.

These are often large scale projects both on a physical

and a fi nancial level. For this reason, it could be useful to

divide the projects in stages, so that the project is carried

out in three or four phases, like in the case of the Rotterdam

footbridge mentioned above. This would both decrease the

size of the initial investment, and involve later on citizens

who were not involved in the initial campaign, which would

have an important social aspect. A fi rst stage which is

both effi cient and not too costly can demonstrate that the

method is clear and

transparent, that the

invested money is being

employed according to

the project plan and that

the rewards are being

given out. All of this

should help the project

to progress as planned,

thanks to the fact that the

project’s ideas are being

practically implemented.� � � � � ! " # $ % & ' ( ) * ( + , - ( & - " . # ' / # ' -0 # * - 1 2 ' & / - * & 2 + # " " 3 - + 3 4 ! " # $ % & ' (A reward based crowd-funding model is the one that

suits best the dynamics of civic crowd-funding. The

administrations’ lack of the necessary funds to carry out

some projects would not allow for any fi nancial rewards to

be offered to citizens (therefore equity based crowd-funding

is to be excluded). On the other hand, the building of a

public structure would allow for a variety of rewards linked

to the structure itself to be offered. These rewards would

range from seeing one’s name on a wooden board on a

bridge, to obtaining an annual subscription to a museum or

theatre. The model known as “pre-selling model” could be

suitable for the chronic lack of funding mentioned earlier,

which is one of the major obstacles for urban crowd-

funding. This could also help dissipate initial scepticism

and lack of understanding around the ideology of crowd-

funding: the individual makes a donation not merely for

an individual benefi t, but rather to share the benefi t with

others for the collective well-being. However, considering

rewards for individual supporters could be of help in a

period of transition like the one we are living at the moment.

20

Another solution for the scarcity of public funding could

be to apply a crowd-lending system. A loan from citizens

to public administrations is facilitated on the model on

the German platform LeihDeinerStadtGeld. This way,

public administrations would ask for loans directly from

citizens rather than from banks, and citizens would be

encouraged to invest in the future of the place where they

live. The advantages are obvious: local government would

receive a closed-end loan at a low interest rate. Citizens

are rewarded with a better community and with a small

interest rate, which is still better than what many banks

offer on traditional bank accounts. Moreover, trusting

that citizens understand that the primary benefi t they will

receive is a better community and public services modelled

on the community’s real needs, the option of not offering

interest on loans could be considered. This process must

be based on the utmost transparency in order to work:

citizens should have access to projects’ proposals and

to the reasons why a local government deems a project

infeasible; they should have forums on the platforms, thus

improving the feedback from all the interested parties.

This proposal should be regulated by the relevant authorities

in order to be implemented, as it is already the case with

equity-based crowd-funding. The cases analysed earlier

are on the town or neighbourhood scale, however this

model could be scaled up in the context of Italy. Projects on

different scales could be put forward, involving increasingly

large communities. This factor is not to be underestimated,

as the idea behind the project and the relevant community

constitute the strength of this method. On the basis of

this, we propose to employ a national platform which is

divided into sub-levels for regions, provinces and towns.

The platform model so far described would lead to a

global gathering and sharing of ideas, with a subsequent

push to publicly debate choices relevant for citizens,

who would become more informed about the public

administration’s choices and would fi nd it easier to form

project’s groups. Finally, this platform could become the fi rst

element of a larger sharing network, and hopefully a real

network of towns, provinces and regions can be created.

12312321

5 6 7 8 9 : ; < ; = > ? @ ?User-friendly structure•

Internationally recognised method•

High involvement of social players•

Repeatability of projects•

High rate of process democratization•

Creation of businesses•

More dialogue between P.A. and citizens•

Decrease in digital divide•

Increase in speed in broadband services•

“Digitisation” of processes•

Opportunity for economic development•

Initation of high speed dialogue with international •

communities due to new infrastructures

Increases inclusion•

Encourages citizens’ IT literacy•

Aimed at public administrations, wich must have a •

leadership role

Suitable for pubblic administrations that want to •

invest in development and innovation

Diffi culty in raising funds•

Entails a good level of IT literacy among the •

citizens involved

Weak leadership of pubblic adminastrations•

Possible lack of interest among citizens •

Absence of suffi cient network services•

Public administration’s diffi culty in dealing with •

complex and innovative organisations

22

SWOT analysis

A B C D E F G H B CDevelopment is generated through innovative processes

which derive from the interaction of four core strengths:

ideas, institutions, population and human capital (expressed

through education and research). As demonstrated in

this short paper, civic crowd-funding is able to create

an interaction among these four components and to

point them towards common objectives, by facilitating

processes and adding two essential elements created

by the web 2.0: relationships of trust and transparency.

We have analysed this proposal in order to put across

that it is already possible to put it into practice, with

current means: there is nothing we have to wait for but

support from the responsible parties. It is an opportunity

to take part directly and actively to the betterment of the

society we live in, going beyond delegating, which takes

us away from what should concern us the most: our local

community. Now more than ever, there is harm in not trying.

CIVIC

CROWD

EDUCA

TION

OPEN

SOURCE

COOPE

RATION

HUMAN

CAPITAL

POPULA

TION

IDEAS

INSTITU

TIONS

12312323

conclusion

I J K J L J M N J Ohttp://www.forbes.com/sites/chancebarnett/2013/03/20/crowdfundings-future-local-online-ecosystems/

http://rodrigodavies.com/blog/2013/02/19/civic-crowdfunding-from-the-statue-of-liberty-to-now/ x

http://www.aia.org/press/releases/AIAB097681

http://www.aia.org/aiaucmp/groups/aia/documents/pdf/aiab097668.pdf

http://www.launcht.com/blog/2012/11/27/state-of-crowdfunding-in-the-government

http://blog.civiccommons.org/2011/11/crowdsourcing-civic-infrastructure

http://www.archdaily.com/233194/can-you-crowdsource-a-city

http://archrecord.construction.com/news/2012/10/121024-Crowdfunding.asp

http://vodblogsite.org

http://spacehive.com

http://citizinvestor.com

http://neighbor.ly

http://www.luckyant.com

https://www.leihdeinerstadtgeld.de

http://www.citysourced.com/about (http://www.citysourced.com/zenfunder)

http://giveaminute.info

http://changeby.us

http://www.newurbanmechanics.org

24