What Is Crowdfunding?

Quick answer: Crowdfunding is an online fundraising approach where many individuals give—often small amounts—toward a specific project, campaign, or goal, frequently through mobile-optimized donation pages and peer-to-peer sharing.

What Is Crowdfunding?

Crowdfunding is a fundraising method that asks a broad group of supporters to give online to a defined campaign, project, or need over a fixed period. It often relies on a public campaign page, clear goal, deadline, and shareable stories and assets so supporters can donate and spread the campaign across social media, email, and text. Crowdfunding can be run by the nonprofit itself or as peer-to-peer campaigns where individual advocates raise for the organization on their own pages.

Nonprofits use crowdfunding for project funding, emergency relief, capital needs, program launches, or community-driven initiatives. Campaign types vary—fixed-goal (all-or-nothing), flexible fundraising, recurring upgrades, and peer-to-peer fundraisers—but the constant is urgency and shareability. Because crowdfunding centers public visibility, it’s not just about dollars raised; it’s also a tool for acquiring new donors, testing messaging, and activating volunteers and advocates.

Why Crowdfunding Matters for Nonprofits

Crowdfunding matters because it turns many small acts of giving into momentum. For nonprofits with limited development staff, a well-designed crowdfunding campaign can quickly expand reach beyond the existing donor base, attract younger and mobile-first donors, and create real-time social proof as donations and shares accumulate. That visibility can translate into new one-time donors who, when stewarded correctly, become recurring supporters.

Crowdfunding success varies by audience, ask strategy, and follow-up. Track your campaign outcomes and convert momentum into sustained relationships so a burst of generosity becomes ongoing support.

How Crowdfunding Works in Practice

Imagine Sunrise Community Kitchen, a mid-sized food program with 1,200 past donors. The development officer sets a 30-day crowdfunding campaign to fund a new refrigerated van with a $20,000 goal.

1. Set the ask and story: the team crafts a short video, three donor-impact stories, and a clear goal and deadline.

1. Build the page: they publish a mobile-optimized campaign page with suggested gift amounts and instant tax receipts.

1. Launch and activate advocates: staff invite 10 committed volunteers and board members to create their own peer-to-peer pages and share within their networks.

1. Promote: the campaign combines email blasts, social posts, and a text-to-donate link for easy mobile gifts.

1. Track and steward: gifts sync into the CRM in real time; the team monitors daily progress, highlights supporters on social, and sends personalized thank-you messages to early donors and top advocates.

1. Convert: after the campaign, the team segments first-time donors for a targeted stewardship sequence aimed at securing a second gift.

This approach turns urgency and social proof into measurable donor relationships, not just a single revenue spike.

Crowdfunding: Key metrics and benchmarks

• Campaign goal attainment

• What to track: percentage of goal reached by campaign close.

• Note: Benchmarks vary widely by campaign type and audience; use your own past campaigns as the primary baseline.

• Donor acquisition

• What to track: number and percentage of donors who are new to your organization.

• Note: Benchmarks for “good” new-donor rates depend on promotion channels and ask strategy.

• Average gift size

• What to track: mean donation per gift for the campaign.

• Note: Average gift varies by cause and campaign; compare to your typical online gift.

• Conversion rate (page visits → donations)

• What to track: percentage of campaign page visitors who give.

• Note: Online and mobile conversion rates are not standardized across the sector—track yours and improve page clarity and suggested amounts.

• Peer-to-peer participation and performance

• What to track: number of peer fundraisers, average raised per peer, and top referrers.

• Retention and lifetime value uplift

• What to track: percent of first-time campaign donors who give again within 12 months.

Related nonprofit terms

peer-to-peer-fundraising A fundraising model where supporters create personal campaign pages to raise money on behalf of your organization.

text-to-donate A mobile giving method that lets donors give quickly via SMS or short-form web pages linked from texts.

giving-tuesday An international day of online giving and generosity, often used as a focal point for crowdfunding and year-end appeals.

fundraising-appeal A targeted request to supporters—via email, mail, social, or events—asking for donations to a stated need.

donation-matching A strategy where a donor or sponsor agrees to match contributions up to a set amount to increase motivation and urgency.

How Bloomerang Helps You run crowdfunding

Bloomerang Fundraising creates mobile-first campaign pages and peer-to-peer programs that make it simple for supporters to give and share. Gifts and donor details sync automatically into Bloomerang CRM, so you see real-time progress, donor origins, and peer fundraiser performance without manual imports.

Use Bloomerang reporting and automation to identify high-value advocates and trigger timely stewardship—welcome emails, thank-you templates, and segmented follow-ups. Penny can help draft campaign messaging, social copy, and thank-you language, so you spend less time writing and more time building relationships.

Frequently Asked Questions

What’s the difference between crowdfunding and peer-to-peer fundraising?

Crowdfunding usually refers to a central campaign page collecting many small gifts for a specific goal. Peer-to-peer fundraising is a form of crowdfunding where individual supporters create their own pages to fundraise on your behalf; both can run together but peer-to-peer relies more on individual networks.

How does a nonprofit turn one-time crowdfunding donors into recurring supporters?

Follow up promptly with personalized stewardship, segment first-time donors in your CRM, offer meaningful impact updates, and invite them to a low-friction second ask or monthly giving option within 3–6 months after the campaign.

When should I choose a fixed-goal (all-or-nothing) model versus a flexible model?

Choose fixed-goal when the project depends on full funding and you want urgency and a clear “make or break” message. Use flexible giving when partial funds are still useful and you want to lower friction for donors.

How do I measure the success of a crowdfunding campaign beyond dollars raised?

Track new-donor acquisition, conversion rate from page visits, peer fundraiser activity, average gift size, social shares, and the retention rate of new donors over 6–12 months.

How can I make my crowdfunding page convert better on mobile?

Keep the page simple: short story, clear goal, suggested gift amounts, one-click giving options, and immediate receipts. Test headline, images, and CTA placement on a mobile device before launch.

What tools do I need to run a peer-to-peer crowdfunding campaign?

You need mobile-optimized campaign pages, peer fundraiser landing pages, easy ways for supporters to share, real-time gift tracking, and a CRM that syncs data so you can segment and steward supporters efficiently.

The Bottom line

Crowdfunding is an online fundraising method that rallies many donors around a specific goal, creating both immediate revenue and new supporter relationships. It matters because it expands reach, attracts mobile-first donors, and builds momentum you can convert into long-term support. Start with a clear goal, mobile-first page, and a plan to steward new donors.