Crowdfunding activity in the healthcare sector is likely to grow dramatically over the next year. In an extension of existing online charitable fundraising, medical research charities like Cancer Research UK have begun to use their own crowdfunding websites to supplement their support for specific research projects.
Entirely new models are also emerging, however. New non-profit organizations like Consano, for example, are being built from the ground up around specialty crowdfunding portals. In another new development, individual research centers like the Fred Hutchinson Cancer Research Center are starting their own fundraising websites and experimenting with new approaches to crowdfunding – for example, Project Violet‘s effort to crowdfund the development of a new class of pharmaceuticals. There’s every reason to think that the ability of donors to support specific research projects, labs, and investigators will unlock a significant donor base that has until now been unwilling to donate to large medical research charities and universities.
Equity-based crowdfunding activity in the healthcare space is also poised to take off as soon as the legal questions surrounding the practice are clarified in the United States (and, hopefully, in Canada). A wide range of health-focused equity crowdfunding portals are setting themselves up to take advantage of this market when it opens up, though most have yet to launch operations.
In order to provide an initial map of health-related crowdfunding, I’ve compiled the following table, which lists all the health-specific crowdfunding portals I’ve come across. I’m sure I’m missing some, so if you know of any others, please let me know by posting a link in comments or by emailing me at firstname.lastname@example.org, and I’ll add them to the list.
UPDATE: Added StartACure, September 23, 2013
UPDATE 2: Added Cure Cancer Starter, October 18, 2013
UPDATE 3: Added Microryza, October 20, 2013
Crowdfunding Portals for Healthcare R&D
|Cure Cancer Starter||Donation-based|
|My Projects – Cancer Research UK||Donation-based|
|Rare Genomics Institute||Donation-based|
In a recent post on University Affairs’ Black Hole blog, Jonathan Thon calls on Canada’s federal research funding bodies to set up their own crowdfunding portals as a way of supplementing the number of proposals that receive funding. While I am skeptical about the specific suggestions he makes in the post, a move into the crowdfunding space should be a no-brainer for most science funding bodies. To illustrate this, let’s take a look at the Canadian Institutes of Health Research’s (CIHR) Open Operating Grant (OOG) Program.
In the September 2012 OOG competition, CIHR approved 485 grants out of 1,610 proposals that it deemed “fundable” after peer review. That leaves 1,125 fundable but unfunded research projects. Since they have already been positively evaluated by CIHR reviewers, why not allow these applicants to try to raise the necessary funds from public contributions using a CIHR-certified crowdfunding campaign?
Academic research into crowdfunding has found that “project quality” is one of the key determinants of success for crowdfunding campaigns. But as Pieter Droppert has pointed out, potential donors may find it particularly difficult to gauge the quality and likely impact of a proposed scientific research project, and may therefore be reluctant to contribute to it. This is true even of practicing scientists, since a climatologist may find it just as difficult to evaluate a molecular biology project as a typical member of the educated lay public.
CIHR and other funding bodies could go a long way to solving this problem by providing some kind of official certification of an OOG proposal’s reviewer ratings on either an in-house crowdfunding website or on a third-party portal. This would give members of the public who are interested in financially supporting Canadian science an easy way of picking worthy projects. It would also allow CIHR to recoup some of the costs of reviewing so many excellent but ultimately unfunded proposals.
According to CIHR’s own estimates, processing each OOG proposal costs about $3,100 in administrative and peer review expenses (and this is in addition to the $10,900 and 169 hours spent by applicants to prepare an application). That works out to about $3.5 million spent on evaluating fundable projects that did not ultimately receive funding, in just one competition. A CIHR-certified crowdfunding portal could help to recoup a significant portion of these sunk costs (not to mention the approximately $12 million spent by fundable but unfunded applicants in preparing their applications). Even assuming a $50,000 or $100,000 investment in getting a pilot crowdfunding system up and running, the potential payoff is enormous. Cancer Research UK has taken a similar approach for several years now, with several projects raising over 100,000 pounds (though their system aims to raise additional resources for already-funded researchers). CIHR could create its own crowdfunding website or partner with independent crowdfunding portals to provide a “certification” option for submitted projects. Either way, it’s definitely time for Canada’s funding bodies to jump on the crowdfunding express.Tags: Canada, CIHR, crowdfunding, funding bodies, research, science