I’ve underscored the importance of pooling resources together in order to achieve business goals. One of such approaches is crowdfunding and it is steadily gaining traction locally. Simply put, crowdfunding involves the mobilization of funds from a pool of people who contribute varying amounts towards a cause. One of the popularly known crowdfunding platforms globally is GoFundMe. Significant amounts of money were raised for Cyclone Idai victims last year through that platform. We are still to have such local crowdfunding platforms of our own. We do have a promising one called Funded which is being developed by Keith Mlauzi. More popular locally is the system of savings clubs known as “round” or “mukando“. The focus of my article is a bit different i.e. the angle I am discussing crowdfunding from.
Crowdfunding Has Been Mainly Consumptive
People have been and are mainly using crowdfunding for consumptive purposes. For instance, the Cyclone Idai example I mentioned earlier – the funds raised were for immediate consumption. You will see this trend ringing true for virtually all other crowdfunding initiatives. It can be someone raising funds for a medical emergency, capital for a business or project, and so on. All that is good, do not get me wrong, but I feel there is so much more to crowdfunding than just raising funds for immediate consumption.
Crowdfunding For Investment Purposes
How about turning to crowdfunding as a tool to roll out investment initiatives? I believe we should increasingly become more interested in that. I am not only just referring to online crowdfunding platforms per se. Rather I am referring to the principle of crowdfunding as an approach. Let me give an example to open your eyes to what I am driving at. You probably might have heard about it or not; either way it is noteworthy. Here it is:
A Murang’a County Women SACCO
This is a group of 25000 women in Kenya who managed to raise US$1 million which they used to build to a 5-storey building. How were they able to raise an amount? The answer is simple; they pooled their resources together using a crowdfunding approach. The individual monetary contributions came from their personal savings. The contributions ranged from as low as US$0.10 per day. The building has a total of 102 rooms and is earmarked for university students – smart thinking. A brief side note; I have emphasised numerous times that people should seriously consider investing in student accommodation locally. At full occupancy, the building can accommodate 408 students which translate to US$15000 in revenue monthly. From those earnings, these women are working on purchasing a 2000-acre piece of land. From that land, the women will apportion it amongst themselves to build their own houses. All this has been made possible from just a simple principle – crowdfunding.
Investment Made Easy
From the real-life example I just gave you you can see how investments can be made easy by crowdfunding. The US$1 million dollars that were used to construct the building became an easy go because 25000 women came together. Picture this scenario – each woman contributed only US$40 to become an investor in this initiative. Just US$40 but now they are on their way to building their own individual houses; that is remarkable! This is something local Zimbabweans must seriously consider because if these women did it so can anyone here. It might not be to construct a student accommodation building (though that is a sure investment guaranteed to bear fruits) but it can be anything really.
A Radical Shift In People Mindsets
Crowdfunding relies heavily on people coming together to pursue a common cause. This is a tall order for most people because they are hardwired to look out for only themselves. There is this deep-seated individualism that is the cause for so much division and hatred amongst local Zimbabweans. In order to adapt and execute crowdfunding initiatives for investment purposes there is a need for people to renew their minds. People must inculcate in themselves a collective spirit that is so eager to see people moving together and achieving great things together. I have seen people trying to put their heads together for even miniature causes to no avail due to contentiousness. So it is important that people condition themselves to be more inclined to collaboration rather than individualism. The success of crowdfunding especially for investment causes depends on that immensely.
This is just the beginning of the year and I believe what I have discussed is worthy of your consideration. After all, most of you are familiar with, have been or actually are in stokvel-like initiatives (i.e. mukando). That is just a micro-level of the example I gave earlier. Premising on that you could safely say there is potential for people to scale up and do investment initiatives using crowdfunding. Investment does not have to always cost you a fortune – crowdfunding can be the answer!