Crowdfunding in the Public Sector: Theory and Best Practices PDF
Preview Crowdfunding in the Public Sector: Theory and Best Practices
Contributions to Finance and Accounting Regina Lenart-Gansiniec Jin Chen Editors Crowdfunding in the Public Sector Theory and Best Practices Contributions to Finance and Accounting The book series ‘Contributions to Finance and Accounting’ features the latest researchfromresearchareaslikefinancialmanagement,investment,capitalmarkets, financial institutions, FinTech and financial innovation, accounting methods and standards, reporting, and corporate governance, among others. Books published in this series areprimarily monographs and edited volumes that presentnew research results, both theoretical and empirical, on a clearly defined topic. All books are publishedinprintanddigitalformatsanddisseminatedglobally. Moreinformationaboutthisseriesathttp://www.springer.com/series/16616 (cid:129) Regina Lenart-Gansiniec Jin Chen Editors Crowdfunding in the Public Sector Theory and Best Practices Editors ReginaLenart-Gansiniec JinChen JagiellonianUniversityinKraków TsinghuaUniversity Kraków,Poland Beijing,China ISSN2730-6038 ISSN2730-6046 (electronic) ContributionstoFinanceandAccounting ISBN978-3-030-77840-8 ISBN978-3-030-77841-5 (eBook) https://doi.org/10.1007/978-3-030-77841-5 ©TheEditor(s)(ifapplicable)andTheAuthor(s),underexclusivelicensetoSpringerNatureSwitzerland AG2021 Thisworkissubjecttocopyright.AllrightsaresolelyandexclusivelylicensedbythePublisher,whether thewholeorpartofthematerialisconcerned,specificallytherightsoftranslation,reprinting,reuseof illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similarordissimilarmethodologynowknownorhereafterdeveloped. Theuseofgeneraldescriptivenames,registerednames,trademarks,servicemarks,etc.inthispublication doesnotimply,evenintheabsenceofaspecificstatement,thatsuchnamesareexemptfromtherelevant protectivelawsandregulationsandthereforefreeforgeneraluse. The publisher, the authors, and the editorsare safeto assume that the adviceand informationin this bookarebelievedtobetrueandaccurateatthedateofpublication.Neitherthepublishernortheauthorsor theeditorsgiveawarranty,expressedorimplied,withrespecttothematerialcontainedhereinorforany errorsoromissionsthatmayhavebeenmade.Thepublisherremainsneutralwithregardtojurisdictional claimsinpublishedmapsandinstitutionalaffiliations. ThisSpringerimprintispublishedbytheregisteredcompanySpringerNatureSwitzerlandAG. Theregisteredcompanyaddressis:Gewerbestrasse11,6330Cham,Switzerland Preface Inrecentyears,crowdfundinghasbecomeimportantandithasbeenenthusiastically used not only by commercial organizations but also by the public sector. In the public sector context, crowdfunding is the funding of projects which, directly or indirectly,benefitfrom governmentfunds, assets, orsponsorship,andmayinclude thedevelopmentofpublicassets.Itisexpectedthatcrowdfundingasanexampleof processinnovationandinnovationinpublicsectormanagementwillhelpinsolving social problems and to carry forward politically contentious services. This alterna- tivesourceoffinancingintimesofconstrainedgovernmentbudgetsenablescitizens to vote with their dollars online to bring ideas into reality. However, despite the growing participation of public organization in the crowdfunding industry, little is known. The lack of scholarly attention to crowdfunding in public sector is an important omission in the literature, given that many public organizations around theworldarealreadyactivelyutilizingit. Thebook“CrowdfundinginPublicSector:TheoryandBestPractices”isafirst comprehensivebookonthecrowdfundinginpublicsectorItheoryandpractice.This bookshedsmorelightonthedevelopingconceptofcrowdfundinginpublicsector, with an overview of current academic discussions and best practices on crowdfundinginpublicsector.Thisbookapproachescrowdfundinginpublicsector fromanintegratedperspective,addressingthedearthofpublicationsonthesubject. This book explores the relationship between crowdfunding and collaborative gov- ernance.Italsodescribesatypologyofcrowdfundinginpublicsectorwhichwillbe useful to others in categorizing their crowdfunding approaches. It documents and disseminates the veritable treasure trove of practical experience currently available on crowdfunding in public sector. It offers a unique overview of what public organizations around the world are doing to implement crowdfunding and how theireffortsrelatetocarryforwardpoliticallycontentiousservices.Thebookgathers awealthoftheoreticalinformation,ideas,bestpractices,andlessonslearnedinthe context of executing concrete crowdfunding projects, and assesses methodological approaches to integrating the topic of crowdfunding in public organizations curricula. v vi Preface Thisbookprovidesaglobaldefinitions,insights,andexamplesofthismanagerial perspective resulting in a theoretical framework of crowdfunding in public sector. Thisbook alsoexploresdifferentcrowdfundingapplicationsinpublicsectorssuch as local government, higher education, schools, arts and culture organizations, healthcare,energysector,andpoliceservices.Includingcontributionsfrominterna- tional academics, scholars, and professionals within the field, this book provides a global,multidimensionalperspectiveoncrowdfunding.Wehopethatyouwillfind them informative and that they will help you shape your own thinking on crowdfundinginpublicsector. Kraków,Poland ReginaLenart-Gansiniec Beijing,China JinChen Introduction Crowdfundingunderstoodasanopensearchofideasandmoneyhasproventobean important and enduring concept. In the past decades, the crowdfunding platforms suchasKickStarter,IndieGoGo,orCauseshavebeensignificantlyincreasingtheir popularity.Scholarshavebeenpredominantlystudyingcrowdfundinginthecontext ofnewventures,butexploringitinthepublicsectorisamissingpiecethatwillhelp us in understanding the big picture of citizens’ engagement in innovation, science, andgovernance. I have researched the idea of Open Innovation for over a decade. As much as OpenInnovation(Chesbrough2003,2020)highlightingtheimportanceofpurpose- fulknowledgeinflowsandoutflowsisalmost20yearsold,theOpenInnovationin Science(SusanneBecketal.2020)andOpenGovernance(Almiralletal.2014)are still emerging phenomena. Open Innovation in Science encompasses purposeful knowledge inflows and outflows within and across organizations and disciplines along the entire research process. Open Governance also called Civic Open Inno- vation concerns the knowledge inflows and outflows within and across the governing boundaries of cities, municipalities (or counties), and regions where the wider public—citizens (and often residents) get a chance to actively shape and reshape the growth directions. As a result, services and decisions become more open,transparent,andinclusive. Historically “lay” citizens were only the recipients of science education and legislationsmadebytheeducationalinstitutionsandgoverningbodies,respectively. Theemergenceofmoredemocratizedmodelswasstimulatedbythedevelopmentof search-expanding technologies. These allowed wider dissemination of innovative ideas, popularization of exchange platforms, and (voluntary) participation in both sourcing and funding activities (Dahlander et al. 2021). Although there may be a different level of engagement, both crowdsourcing and crowdfunding may be considered as very promising approaches to boosting citizens’ engagement in innovation,science,andgovernance. Besides technological developments, we have been also witnessing a strong politicalbackupinembracingopenness.In2009,onhisfirstdayinoffice,President vii viii Introduction Obama signed the Memorandum on Transparency and Open Government, which wasfollowedbymultipleOpenInnovationinitiativessuchascontests,hackathons, and campaigns. This Open Government initiative followed three principles for the governmenttobetransparent,participatory,andcollaborative.Themainaimofthis Memorandumwastoempowerthepublictoinfluenceimportantdecisionsthataffect their lives. This gave them a possibility to track how the government spends the money. The open data catalogue created in the USA was an inspiration to many Europeancitiesandgovernments.Asaconsequence,EuropeanParliamentadopted the Public Sector Information Directive in 2013 and Open Data Directive in 2017. Built on the extensive consultations, these directives cover the reuse of publically funded public sector information. With the changing mindset of citizens and supportinglegislations,thelastbutnotleastelementistheexchangeplatform. Crowdfundingfallsintooneofthedigitalwaysofaccessingexternalknowledge (Bogers et al. 2017), which typically happens through a dedicated platform. The platform links people who network and pool their money—the bakers with other people ororganizations—theproponents.Thebackers emerging fromthecrowsof the Internet users offer financial support for the proponents of project ideas. The proponentsnotonlygetachancetocollectthenecessaryfundingforimplementing their projects but also get exposure to feedback and early market entry screening data.Scholarstendtofocusontheircrowdfundingstudiesonentrepreneurialideas (Belleflammeetal.2014;Colomboetal.2015;Mollick2014),whichlargelycover thecommercialside ofcrowdfundingwherethebakersexpectsomereturnoftheir investment.Crowdfundinginthepublicsectorleansmoretowardsthephilanthropic sideofcrowdfundingwherethebakerswanttocontributetoagreatergood. Studyingcrowdfundinginthepublicsectorputsourattentiontothebroadersetof institutional and infrastructural open innovation arrangements. Crowdfunding enables, enhances, and empowers citizen’s innovation. The funding aspect is very important for supporting various types of initiatives, but at the same time, it offers citizen’s a way to influence the innovativeness, compliance, and integrity of the publicsector.Tosomeextent,itmayalsochallengeitsperformanceandqualityby highlightingpotentialareasofattentionandimprovement. CrowdfundinginthePublicSector—Theory andBestPracticesoffersanexcel- lentreminderofthetheoreticalfoundationsofcollaborativegovernancealongwith very powerful practical examples from higher education, healthcare, the energy sector,andbeyond.Theinterestincitizenconsultationsandparticipatoryfinancing practices extends well beyond the United States and European Union, to Canada, China, and the United Kingdom. Digitalization of crowdfunding practices allows widerreachandimpactthuscreatenewopportunitiesforinnovation.Thedefinitions, frameworks,andtypologiesfollowedbytheselected6diversecountry-sectorcases canbefound onthepages here thatfollow.Itisexcitingandconvenienttohaveit gathered all together in one book, covering multiple contributions. As it will encouragescholarsandcitizensforfurtherexplorationofthetopicofcrowdfunding inthepublicsectorandimplementationofitsbestpractices. This new approach to Open Innovation will help cities, municipalities (or counties), and regions create more effective, useful, and participatory services Introduction ix fortheircitizensandotherinvolvedstakeholders.Astheseparticipatoryandcollab- orativegovernancepracticeshavebeenslowlyemerging,thechallengeistogetthem morewidelyspreadbysharingbothgoodandbadexperiencesofOpenGovernance. Further research and implementations inspired by Crowdfunding in the Public Sector will allow us to write new chapters on purposeful knowledge inflows and outflows within and across the governing boundaries where the citizens actively contributetoservicesanddecisions,whichinturnbecomemoreopen,transparent, andinclusive. GarwoodCenter,UCBerkeley& AgnieszkaRadziwon BusinessDevelopmentandTechnology, Berkeley,CA,USA AarhusUniversity,Aarhus,Denmark References Almirall E, Lee M, Majchrzak A (2014) Open innovation requires integrated competition-communityecosystems:lessonslearnedfromcivicopeninnovation. BusHoriz57:391–400 Belleflamme P, Lambert T, Schwienbacher A (2014) Crowdfunding: tapping the right crowd. J Bus Ventur 29:585–609. https://doi.org/10.1016/j.jbusvent.2013. 07.003 Bogers M, et al (2017) The open innovation research landscape: established per- spectives and emerging themes across different levels of analysis. Ind Innov 24:8–40 Chesbrough H (2003) Open innovation: the new imperative for creating and profitingfromtechnology.HarvardBusinessSchoolPress,Boston,MA ChesbroughH(2020) Open innovationresults:going beyondthehype andgetting downtobusiness.OxfordUniversityPress,Oxford ColomboMG,FranzoniC,Rossi-LamastraC(2015)Internalsocialcapitalandthe attractionofearlycontributionsincrowdfunding.EntrepTheoryPract39:75–100. https://doi.org/10.1111/etap.12118 DahlanderL,GannDM,WallinMW(2021)Howopenisinnovation?Aretrospec- tiveandideasforward.ResPolicy50:104218 Mollick E (2014) The dynamics of crowdfunding: an exploratory study. J Bus Ventur29:1–16.https://doi.org/10.1016/j.jbusvent.2013.06.005 SusanneBetal(2020)Theopeninnovationinscienceresearchfield:acollaborative conceptualisation approach. Ind Innov. https://doi.org/10.1080/13662716.2020. 1792274
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