On her crowdfunding page, Summer Baird has listed items to redeem when her pub reopens, like brunch for two, a wine tasting session, and paintings from a local artist. Her business, The Hintonburg Public House in Wellington West, Ottawa, has lost all of its business to the COVID-19 outbreak.

One of the weirder items is a giant horse head in the dining room. “I put it out to the community to see what people wanted,” Baird explained. It has sentimental value so she put a high price on it. “If somebody really, really wants it then I’ll have to let it go,” she said.

The Hintonburg Public House is one of the first participants in a new pilot campaign called LOVE.WellingtonWest.ca, run by the Wellington West Business Improvement Area (BIA) and Crowdfund Canada. Created by the McConnell Foundation, the pilot is the first project for its Community Wealth Sharing Initiative, which aims to build community resilience through collective action. The Foundation has allocated $75,000 for three community wealth-sharing projects, the first to launch being LOVE.WellingtonWest. 

Globally, crowdfunding campaigns have raised $34 billion so far. It has emerged into a promising tool for the social impact world. As Future of Good reported in April, crowdfunding platforms are being used in the COVID-19 crisis to support frontline workers and vulnerable populations. 

Despite support from the federal government, two in five independent businesses are worried about permanent closure. 

Now small businesses could use some help too. Despite support from the federal government, two in five independent businesses are worried about permanent closure. As the COVID-19 crisis reminds community members of how fragile Main Street is, the LOVE.WellingtonWest.ca project hopes to transform those concerns into action.

Pay it forward 

As the COVID-19 crisis began to unfold, Dennis Van Staalduinen, executive director of Wellington West BIA, increasingly heard from locals who wanted to help prevent businesses going under. “We were scrambling to figure out a way to help our businesses in a more direct way,” he said. 

The McConnell Foundation brought together Van Staalduinen’s organization with Crowdfund Canada, a new expansion of Crowdfunder UK. The platform, on which more than $130 million has been raised so far, had recently created a special “Pay it Forward” campaign in the UK to help community members support their local businesses.

Their pitch to communities was about the survival of local business, said Simon Deverell, Crowdfunder’s founder. “If you want the business that you love, the coffee shop, the café, the pub, whatever it might be, to still be here after all of this,” he said, “then you might need to think about paying it forward.”

Now being tried in Canada, the program is a “blend of an altruistic, philanthropic donation – where they feel like they’re investing in the success of their local community – with some sort of a reward or incentive,” explained Van Staalduinen, such as a future product or service. “The ideal way for communities to support their local business is not simply by a transaction.”

How it works

Usually Crowdfund Canada would take a 3 percent commission for donations but have waived the fee in the current crisis. With funding and administrative support from McConnell, the partners are ensuring that the businesses have nothing like transaction fees to pay.

The businesses receive donations as soon as they come in, as opposed to some crowdfunding models which only release the cash if or when the target is met. The Wellington West BIA is working to recruit businesses and advertise the scheme. So far, five are on the platform, with eight more waiting to come online and another dozen interested.

“No one is saying that this crowdfunding campaign alone will save a business,” Van Staalduinen said. “That’s why we’re asking the businesses to focus on projects or areas of their business or supporting one or two of their staff members’ salaries.” One of the businesses, for example, Brew Donkey Tours, is selling tickets to a “Virtual Beer Hall” in absence of their usual brewery tours. 

There is an art to making the crowdfund as productive as possible. “Even though the platform makes it very easy, it’s still not something you can do in one sitting,” said Van Staalduinen. “It takes a few days for our businesses to really think through what they want to do.”

For businesses, crowdfunding can be a way to road test an idea, gain momentum and win the community’s buy-in. 

For some businesses, like The Hintonburg Public House which had little online presence, this could be an opportunity to reinvent themselves in productive ways. “Why not crowdfund to hire somebody to help somebody to build their online store?” said Van Staalduinen.

“It’s not just about the money,” said Deverell. For businesses, crowdfunding can be a way to road test an idea, gain momentum and win the community’s buy-in. “We’ve found 500 people who believe in us,” they might say, or “we’ve learned how to market or pitch something,” he said.

Community connections 

Another key aspect of the crowdfunding campaigns is they are distinctly local.

The aim of the platform is not only to help raise funds for local businesses, but also to “improve bonds of social capital between residents and businesses,” to build trust and a “sense of solidarity at community level,” said Jayne Engle, program director at the McConnell Foundation.

“I would love to see this kind of thinking deepened into long-term programs,” said Van Staalduinen, “and new ways of allowing neighbourhoods to feel ownership of their local business.”

Summer Baird has been comforted by the strength of community in Wellington West. So far, she knows a significant number of her donors personally. “The Wellington West community has always been really tight,” she said. “It’s very unique in that way. A lot of people in the neighbourhood really do support the businesses in the neighbourhood and each other.”

The McConnell Foundation is looking to try other similar prototypes elsewhere, including in Alberta. If they achieve positive results in Wellington West, however, it may not guarantee success across the country. In Ottawa, a large segment of the population are federal government workers – who have kept their jobs and livelihoods in far greater numbers than in other sectors – leaving a critical mass of people with the means to contribute to their local business.

A new civic future

Crowdfunding is just one of many tools which will be needed to help communities through COVID-19. To some, the impacts of the crisis so far have demonstrated just how fragile communities were before the outbreak, as well as just how profound business and society is going to change.

We know that communities that have high levels of social capital are more resilient in times of disaster.

“We know that communities that have high levels of social capital are more resilient in times of disaster,” said Engle. “The social infrastructure that we need for the future is somewhat different to what we’ve had until now.” 

Even with the community’s support, small businesses will have to change as they grapple with their survival and future plans. 

“My business is going to be completely different, I think, when we do reopen,” said Baird. “Everyone is using the term the ‘new normal,’” she said. “I just need to figure out what that means for us.”

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