Crowdfunding Cultural Projects in Mexico

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Crowdfunding Cultural Projects in Mexico

Inside the Crowdfunding Platform Fondeadora

Master Thesis

New Media and Digital Culture

Faculty of Humanities

University of Amsterdam

Ana Garza Ochoa

(11117575)

Supervisor: Stefania Milan

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List of Figures

Figure 1: Traffic Rank by Alexa.com (accessed 4/22/2016) ... 20

Figure 2: Google Trends by Year in Mexico 2011 - 2016 ... 20

Figure 3: Analytics of Total Visits to Fondeadora.mx from Jan 2012 to Jan 2016 (Provided by Victor Yep) ... 21

Figure 4: Internet Users in Mexico 2015 (Internet Mexican Association) ... 22

Figure 5: Public Spending on Culture (http://www.animalpolitico.com/blogueros-el-dato-checado/2014/09/09/arte-y-cultura-para-todos/) ... 25

Figure 6: Public Spending on Culture (http://www.animalpolitico.com/blogueros-el-dato-checado/2014/09/09/arte-y-cultura-para-todos/) ... 25

Figure 7: Design of funding Projects from Homepage on May 2016 (Fondeadora.mx) ... 35

Figure 8: Presence of Partners in Homepage on April 2015 (WBM) ... 35

Figure 9: Header of Homepage May 2014 (WBM). ... 36

Figure 10: Header of Homepage on April 2015 (WBM) ... 37

Figure 11: Header of Homepage on May 2016 (Fondeadora.mx) ... 37

Figure 12: Successful Results on May 2016 (Fondeadora.mx) ... 37

Figure 13: URL Call to Action (https://Fondeadora.mx/leads/victor). ... 38

Figure 14: Project of the Week at Homepage on May 2016 (Fondeadora.mx) ... 38

Figure 15: Project Section on May 2016 (Fondeadora.mx) ... 39

Figure 16: Project Section on Sept 2015 (WBM) ... 40

Figure 17: Total Backers and Total Funds per Project (Author’s elaboration with data from Fondeadora.mx) ... 44

Figure 18: Percentage of Social Media Platforms Per User (Author’s elaboration with data from Fondeadora.mx) ... 46

Figure 19: Total Comments and Updates in Projects (Author’s elaboration with data from Fondeadora.mx) ... 47

Figure 20: Percentage of Growth of Funding per Project during Campaign (Author’s elaboration with data from Fondeadora.mx) ... 48

Figure 21: Project “Teatro Sensorial” (Fondeadora.mx) ... 49

Figure 22: Project “Jaigûey" (Fondeadora.mx)... 49

Figure 23:Project "Music Hunter" (Fondeadora.mx) ... 50

Figure 24: Project "Fuerza" (Fondeadora.mx) ... 51

Table 1: Related Terms Fondeadora (google.com/trends/) ... 21

Table 2: Total Projects and Funding wanted per Category (Author’s elaboration with data from Fondeadora.mx) ... 43

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Chapter 1. Introduction

“What greater approval than one that involves putting money to be made?”1_{, artist Sergio Zurita}

shared on an interview when promoting his next theater play through the Mexican crowdfunding platform Fondeadora. In June 2015, the dramaturge uploaded a video to the site where he appears in a living room with three other people from his cast. They introduced themselves and narrated their promising new project. At the end of the video they let the crowd know what benefits there would be if they contributed with a certain amount of money, such a double ticket for the play. In

only 72 hours the play, “Before I go, Love”, raised 100,000 pesos2_{(4,731 euros) and after a month}

their total goal of 300,000 pesos (14,194 euros) was completely funded. Sergio Zurita explained he turned to Fondeadora arguing that he preferred letting the public decide if his play was worth

financing, rather than a closed committee of “supposedly theater experts”3_{. Fondeadora, so far,}

has successfully help fund 324 theater plays and more than 1,000 projects in the creative and cultural sector in Mexico. This is just an example of how crowdfunding can be an effective alternative to carry out the implementation of projects that lack of funds and otherwise would not have been realized.

Crowdfunding (henceforth CF) is a phenomenon enabled by the Internet in which several users can support with financial resources the initiative of another user. Two parties, to say so, are connected through a crowdfunding platform. The creators ask the “crowd” to join in their project and after a specific time frame a certain amount of money has to be raised to declare the campaign successful.

There are several crowdfunding models depending on the type of platform; one of the most popular is the Reward-Based model. As it was previously illustrated with the theater play case, this model functions through the dynamic of the creator giving something to each contributor in

exchange for their funding. According to the Massolution 4 report “Crowdfunding Industry 2015”,

the global estimated fundraising for the Reward and Donation crowdfunding models was of 5.5 Billion dollars and a total of 10 Billion dollars were fundraised from all the type of crowdfunding models through the year.

1_{Moreno, Concepción. “Crowdfunding, un acto de libertad: Sergio Zurita.” El Economista. 26 June 2015. Web. 10 June 2016.} 2_{Peso Mexicano is the currency from Mexico.}

1.00 EUR = 20.5 MXN Currency at 2016-05-27 20:09 GMT (http://www.xe.com/)

3_{Moreno, Concepción. “Crowdfunding, un acto de libertad: Sergio Zurita.” El Economista. 26 June 2015. Web. 10 June 2016.} 4_{Massolution is a research and advisory firm specializing in crowdbased solutions.}

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Crowdfunding has been present for several years, but it still is a phenomenon of particular interest for its internet-based dynamics that have an impact in different market sectors. In the specific case of the creative industry many crowdfunding platforms have emerged with the purpose of facilitating renowned and new artists fund their projects. In the process of funding cultural projects, “crowdfunding also provides new possibilities for distributing, democratizing, or altering the gatekeeping functions of traditional selection processes” (Bannerman), thus the reason for artists to consider crowdfunding as a feasible alternative.

The development of crowdfunding, on the other hand, not only depends on the willingness of creators and funders to participate, but “they also need a supportive ecosystem and enabling factors, including forward-thinking regulations, effective technological solutions, and cultures that can adapt to this new investment vehicle” (Crowdfunding’s Potential for the Developing World). These are important factors that have to be taken into account to understand the impact of crowdfunding in different countries. While developed countries are paying more attention to implement crowdfunding as an investment model in the early stage of new business; In developing countries, like Mexico, crowdfunding is still a novelty to fund singular projects through the Reward model. Moreover, there is only one crowdfunding platform based in Mexico dedicated to fund cultural initiatives with the Reward Based model: Fondeadora. This CF platform is the case study for this research due to the role it plays as guide in the crowdfunding topic and in the process of funding projects in Mexico.

The purpose of this research is to analyze which are the engagement features of the crowdfunding platform Fondeadora that have contributed to the realization of cultural projects in Mexico. To study this, it was necessary to conduct a diachronical analysis of the platform since its creation in 2011. The focus was to analyze which elements the platform has integrated overtime to generate an optimal “technological ecosystem” for its creators and funders that lead to the success of projects. Additionally, in order to investigate how creators used the engagement features of the platform, an unobtrusive observation technique was conducted to follow up campaigns during a period of time. To narrow the scope of the research, twenty-one initiatives that belong to the category “Art and Culture” were analyzed to define a set of factors that contribute to the success of cultural projects in the life span of campaigns.

This research finds relevant the study of the platform Fondeadora to understand the expansion of crowdfunding in Mexico and thus contribute with pertinent results for such context.

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Mexico as it will be further discuss, has a promising future in the adoption of crowdfunding and there is no previous report of the platform or the factors that have emerge from crowdfunding projects in the creative industry in Mexico.

Chapter 2. Literature review

This research takes software studies as a framework to analyze the crowdfunding phenomenon. In the following section the positive and negative aspects of Web 2.0 are described to understand which of these aspects are present in crowdfunding. Consequently, it will be explained what is crowdfunding, model and types, and the role of crowdfunding platforms (CF platforms). Additionally, this research focuses on crowdfunding cultural initiatives and thus two examples are described to understand what is the impact of CF in the creative industry.

2.1 Crowdfunding: A Web 2.0 service

Internet connected computers creating an information infrastructure all around the world, and evidently behind these computers, people is connected. The World Wide Web (WWW) appeared as the application that runs on the internet, “with its graphical user interfaces and hypertext structures, made networked computers a useful tool for common users” (Schäfer 9, 2011). According to Schäfer, the WWW allowed large media audiences to use computers for communication, leisure and entertainment activities. Later, the WWW developed into a dynamic web and the term Web 2.0 appeared. This term is first used by O`Reilly in 2005 to describe a set of characteristics that brought singular user dynamics and business opportunities of relevance to the history of software studies. Content sharing and the establishment of social networks (Shacfer 11, 2009) are some of the characteristics that Web 2.0 allowed and thus the active participation of users. Interfaces also adapted a user- friendly design to facilitate the participation of users (qdt. In Langlois et al. 2009).

One of the ideals that seemed possible by using Web 2.0 applications was the creation of collective intelligence, users became active participants in the cultural production of media by re-using and sharing content. Sites like Flickr, a website to upload photographs, allowed its users to tag their own photographs and in that way create a user based categorization. Wikipedia, the major

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online encyclopedia, has grown entirely for its principle of allowing any user to become an editor. More and more applications started emerging with a “trend towards socialization and the creation of ‘user-generated content’ (UGC)” (Schäfer 10, 2011). Participation in this context can be described as the new media promise for the use of technology that advocates to social progress (Schäfer 14, 2011). It is through the activities users can do on the internet that people can be connected and digital networks are formed. “Social media” appeared as a positive concept of community within Web 2.0 applications, emphasizing “aspects of togetherness, equality, collective production and democratic decision-making” (Schäfer 37, 2011).

Another important characteristic of Web 2.0 is service driven applications. O`Reilly states that “one of the defining characteristics of internet era software is that it is delivered as a service, not as a product” (30, 2007). Google is an evidence of what can be a scalable service model in the web, the company created a unique service that functions “between browser and search engine and destination content server, as an enabler or middleman between the user and his or her online experience” (O’Reilly 20, 2007). These service applications, however, moved from the ideal of collaboration to critiques that questioned their function as business models. Langlois et al. (2009) articulate that “the political and cultural importance of Web 2.0 has radically changed the way in which culture is produced and lived”, however, “the Web 2.0 sphere is dominated by aggressive entrepreneurial models and goals”. Applications, such as Google or Facebook, function through the collection of users’ data; social media interactions, for example, are indicators that can be quantify, track and exploited for commercial purposes. Within this context the concept of “free labor” is coined by Terranova, which refers to the voluntary action of users to modify software packages, to more simple actions such as reading email lists (Terranova 2000) or sharing a link in social media, becoming exploited users. She mapped not the effects of the internet but “how the reality of the Internet is deeply connected to the development of late postindustrial societies as a whole" (34, 2000). Terranova argues the Internet is connected to the labor, politics and culture in the digital economy.

Computers, the Internet and software have technological qualities (Schäfer 11, 2011) that allowed new media platforms and services to emerge, including crowdfunding platforms. Collaboration from users and the integration of a service driven model are characteristics of the Web 2.0 present in crowdfunding. The most popular sites of Web 2.0 have succeeded for what is called "innovation in assembly", “when commodity components are abundant, you can create

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value simply by assembling them in novel or effective ways” (O’Reilly 17, 2007). This seems to be one of the major elements of the crowdfunding service, by allowing users to upload their projects, communicate through their tabs, use social media links and facilitate payment methods resulting in a valuable funding process for all type of projects. Furthermore, CF platforms unfold in a socio-technical ecosystem that can be analyze through its design and technical aspects. Socio-technical ecosystem is a concept that Schäfer uses “to describe an environment based on information technology that facilitates and cultivates the performance of a great number of users” (18, 2011). In this ecosystem the design and the user activity are dependent, since the design is created in a specific social and political context (Schäfer 19, 2011). It is valid to say that crowdfunding has developed as a new media practice in which the ideal is to create a network of collaborators and thus crowdfunding platforms embody a socio-technical ecosystem were this occurs.

2.2 What is Crowdfunding?

Essentially, crowdfunding has its roots in the concept of crowdsourcing, which “describes the process of outsourcing tasks to a large [...] crowd of people” (Hemer 8, 2011). Crowdsourcing as a concept first appeared in 2006 in the issue of Wired, a tech magazine, when editor Jeff Howe together with Mark Robinson analyzed companies and institutions outsourcing tasks by their employees to an undefined network of people. To reach said network “the crucial prerequisite is the use of the open call format” (Howe, 2006). The act of crowdfunding is also possible via an open call format, mainly through the Internet, to reach a large group of people for supporting initiatives by means of financial resources (Schwienbacher and Larralde 4, 2010).

It is important to mention that crowdfunding differs from crowdsourcing mostly in the way users are contributing with financial resources rather than their time or ideas (Belleflame 8, 2013). A second important aspect in which crowdfunding differs from crowdsourcing is that rather than collaborating in an initiative available for a community the funds collected are mostly used for personal projects. The initiatives can vary from personal motivations to industry; while some people might ask for funds to pay for a cancer treatment, others might want to finance small ventures or in many cases people will try crowdfunding for a one-time project, such as a theater play.

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Three main parties participate in the crowdfunding process: the creators or entrepreneurs, the backers or funders, and the crowdfunding platforms. Research conducted from 2011 to date regarding the topic of crowdfunding has depicted important characteristics of the actors (creators and funders) who are using this mechanism. The studies analyzed data to find correlations, which validate several hypotheses, mostly based on data from the platform Kickstarter. Belleflam et al. (2013) draw results, which show how crowdfunding consists of financing and operation decisions, thus proposing managerial implications for entrepreneurs. Zvilichovsky et al. (2015) introduced the term peer economy, which refers to the backers who support other projects before creating their own, therefore creating a net of backers who lead to success. The research by Mollick

explores different dynamics to point out “how crowdfunding operates compared to other more

traditional forms of entrepreneurial finance” (2, 2014). Mollick sheds light into various factors, which influence the success of a project, such as the number of Facebook friends, the quality and preparedness effects reflected on projects, and the geography of new ventures. One of the latest research projects by Kuppuswamy and Bayus (2015) followed the dynamics of backers during the life cycle of campaigns in the U.S. platform, Kickstarter. The results showed that backers often provide more funds in the first and in the last week of the cycle of campaign. Potential backers are likely to be influenced by the information regarding how much the project has already accomplished resulting in a positive outcome when the project exceeds 50 percent of the funds. The research proposed by academics does not have its main focus on the platforms, although “technology also has to be acknowledged as being discursive” (Schäfer 15, 2011), especially crowdfunding platforms, which have created a space for creators and funders to participate in.

2.3 Models and Types of Crowdfunding

Crowdfunding makes its impact by mobilizing individuals from the “crowd” to give away small amounts of money for other people’s ventures and initiatives they find attractive (Hemer 8, 2001). The process in which individuals call to ask for funds, and why backers participate has its own dynamics within several exchange models. Ethan Mollick in his study “The Dynamics of Crowdfunding” from 2014, describes four main contexts in which individuals fund projects, which are prevalent to date with the inclusion of other hybrid models.

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The Donation model, which could also be related to a patronage model, is the context in which funders do not expect anything back for their financial collaboration. This model is closer to a concept of philanthropy, and usually the projects have a social cause. The second approach is called “Reward-Based,” and up until 2014, according to Mollick, it was the most prevalent one. In this context the owner of the project gives the funder something of significant value in return. Within this context the exchange includes a “pre-ordering” form where funders become early customers. Creators set up a special price for the product, which allows brands to test consumers’ interest in their product, and obtain feedback from these funders before launching it. The Reward-Based model can also function with the “all or nothing” form, in which the owner of the project and the platform specify a certain amount of funds to be collected within a specific time frame. The owner receives the money only if the financial rate is completed, otherwise the money is returned to the backers. This is one of the most popular models used by pioneer platforms, such as Kickstarter.

The Lending model, which follows the microfinance structure, is used to offer funds in form of a loan. The funders expect some rate of return for the capital invested. Lastly, the model closer to the stock market is the Equity model. In this context, “funders play a similar role to investors [receiving] equity stakes or similar consideration in return for their funding” (Mollick 3, 2014). This type of model requires more regulations from government, which are difficult to determine, since it is directly influencing the market. For example, the JOBS act in United States is working on opening the market to more people (non-accredited investors) to become micro investors in crowdfunding projects. Each model, however, entails a common goal from creators and backers, Mollick states: “ultimately, all forms of crowdfunding are based on similar principles, in that funders are investing funds in a project, and thus are expecting a successful outcome” (4, 2014).

2.4 Crowdfunding Platforms

Mobilizing the crowd to support a certain cause is not a new dynamic, however, the use of technology facilitates this via a digital sphere. Consequently, the easy “adoption of social networking makes crowdfunding feasible even for the average citizen with a dream and some creative talent” (“Can You Spare a Quarter? Crowdfunding Sites Turn Fans into Patrons of the

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Arts - Knowledge@Wharton”). The first crowdfunding platform was launched in 2001 (Gerber and Hui 1, 2012), since then the number of platforms has grown exponentially. The countries with more crowdfunding platforms are the United States with 178 sites, France with 37 sites, and the United Kingdom with 34 sites (Soho Loft News 2015). Through these platforms users can launch a project to be funded that otherwise has more difficulty to acquire funds through a bank or asking for a loan “because they appear too exotic, too innovative to be understood, too complex, too crazy, too risky or which are, simply, poorly presented” (Hemer 2, 2011).

Crowdfunding platforms, in principle, must have a neutral position by acting as facilitators for both creators and funders. Technically speaking, crowdfunding platforms offer the software for users to upload their projects, and the software to facilitate payment procedures. Nevertheless, some CF platforms “offer other value added services beyond the sheer facilitation of funding, such as consulting, managing a co-investment fund, or searching for co-investors” (Hemer 10, 2011). Agreeing with Hemer, the emergence of platforms, which have an added value for the users is crucial given that the owner of a project is probably not specialized in managerial skills, and will most likely run an initiative only once (11, 2011).

The presence of platforms, which do more than facilitating procedures, could be fundamental to guide the new creators and funders, especially in countries where crowdfunding is a relatively new method to fund projects. The presence of the platform within its design, message, and own activity in social media channels could change its neutral intermediary role to an active role as a leader in the crowdfunding topic.

With this in mind, the question about the identity and purpose of crowdfunding platforms emerges. Platforms connect musicians with their fans, a social cause with its community, but to maximize the amount of successful projects, platforms have to appeal “a large community of funders and creators, as well as designing the market to attract high-quality projects, reduce fraud, and facilitate efficient matching between ideas and capital” (Agrawal et al 15, 2013). As of 2011, quality in projects and transparency within payments are issues which crowdfunding platforms have to inform and pursue to generate positive dynamics within their community.

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2.5 Crowdfunding Culture

Crowdfunding cultural projects is a subject of interest since it is affecting the context of what is known as cultural economics. Already in 2012, the CF platform Kickstarter funded more art-related projects than the National Endowment of the Arts in the United States (Boyle). Bannerman stated in her article “Crowdfunding Culture” that “new technologies like crowdsourcing and crowdfunding can and do alter the existing conditions of cultural production.” In concert with Bannerman, crowdfunding has become a facilitator for connecting funders and creators, mobilize ideas and even change organizational hierarchies. More precisely, crowdfunding has reformed the role of gatekeepers involved in the cultural sector: “these sites [crowdfunding platforms] have democratized support for creative endeavors, which have been dominated by large companies (…) by letting fans finance the work of artists directly” (“Can You Spare a Quarter? Crowdfunding Sites Turn Fans into Patrons of the Arts - Knowledge@Wharton”). Crowdfunding has in its essence a positive or even utopian ideal, “using crowdfunding to support any creative endeavors that would otherwise struggle to come to fruition can only enrich cultural expressions across the world” (Sorensen 271, 2015). However, this may also lead into critiques of how culture is being produced through crowdfunding, the actions of platforms, whether there are new gatekeepers, and if the use of social media can have an impact in the creation of certain projects, which do not necessarily have the best quality.

The difference regarding crowdfunding with platforms were users generate the content (UGC), thus having an involuntary participation in the process of commodification (Jin 939, 2015) relies in the fact that the content generated by users in crowdfunding platforms already has a purpose of exchange, it has a value. Apart from the creation of a campaign, social connections are essential to produce a network effect. Grier Alan, expert in the field of technology, mentions in a podcast for Daily Crowdsource, “you are successful in your crowdfunding to the extent you are able to capitalize in that social network.” These are turning points, which constitute an analytic view for the crowdfunding business.

Two perspectives will be described to further analyze how crowdfunding causes tensions between concepts such as collaboration and democracy, labor and value exchange in the creative industry. The first example analyses how crowdfunding has impacted the film industry from a negative perspective, evidencing how through the process of crowdfunding more tensions between

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gatekeepers and professionalism have arose. The second example, on the other hand, describes a CF platform from Sweden that resulted in a carefully designed service which empowers a new form of participating in the funding of cultural projects in the country.

2.5.1 Example: Crowdfunding The Film Industry

Sorensen’s research in crowdfunding for the documentary film industry in the UK shows various concerns, which could be similar in other cultural projects. For this specific context crowdfunding documentaries have become a viable solution for filmmakers due to diminishing funds by the government. Crowdfunding projects are helping the film industry, however, it is not a solution, argues Sorensen. The main problem in this context is that hierarchies are still present and the process for distributing the projects remains within the traditional mechanisms, resulting that “in the final analysis it is not the crowd-funded documentary makers who benefit most from crowdfunding” (Sorensen 271, 2015), but rather the same gatekeepers from the industry. Once documentaries are crowdfunded they enter the same process of selection into major networks or important festivals. According to Sorensen, broadcasters and festivals can purchase already funded documentaries, which means investing less money, and the popularity of these documentaries creates a filter for the major companies to make their selection easier.

Credibility and the consequences for receiving funds from the public rather than the government are the main areas, which could be affected by crowdfunding documentaries, and it can be applicable to other cultural projects as well. The regulations in crowdfunding platforms are still very open, this means that everyone can participate, and the professionalism of other projects might be underestimated. Sorensen also questions how platforms can intervene in the industry, the fact of letting the crowd decide can narrow the plurality of projects, at the end “their remit [crowdfunding platforms] is profit or turnover, not plurality or making sure that a variety of films representing a spectrum of voices are made” (277, 2015).

Sorensen disputes that crowdfunding might even have a reverse effect to democratizing, which is in principle what technology has allowed users to do through crowdfunding. The consequences of crowdfunding are still very opaque, in the making of culture other financial solutions can be applied, however, in the creative industry many artists are choosing funding via crowdfunding platforms, therefore new methods are becoming part of the creative process. In

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another case, the artist Constant Dullaart launched a product via Kickstarter as part of a critique of corporate systems. In an interview with ICA Blog Dullaart mentioned how during the campaign process he obtained efficiency tips from Kickstarter that involved thanking the backers with personalized emails, posting happy tweets regularly, and considering the option of paying for being featured in the company mailing list. Dullaart questions the mechanisms of social capital by saying, “we are living in times where it seems that any interest in anything can be quantified, and as soon as it’s quantified, it can be translated into money.” Social capital is an aspect present in the applications of Web 2.0, therefore in crowdfunding. Creators have to be attentive regarding how to communicate their project, make a quality video, be present in social media channels, and often pay to be featured in the site; these are small, yet important actions, which may result in the success or failure of a campaign. In this new mechanism of labor in digital platforms, “attributes, proclivities, and capacities previously not (thought to be) productive of economic value, such as linguistic or social competences, compassion, care, or taste, are now increasingly valorized in capitalist modes of flexible accumulation” (Van Doorn 356, 2014).

2.5.2 Example: The Crowdculture Platform

One of the crowdfunding platforms, which has applied a different model combining public co-funding, is Crowdculture (www.crowdculture.se) from Sweden. Crowdculture started as a prototype in 2011 by the Swedish Institute of Computer Science (SICS) with the support of the city of Stockholm and other organizations. The objective was to work on a new model to distribute cultural funding and “to engage more people to contribute and participate in the cultural development, consequently delegating decision-making power to a broader public with different references and quality criteria.” (Hansson, 2011).

Funders in this CF platform can become members by paying a small monthly fee (around 6 euros), which go to a fund. The CF platform uses a real time system to leverage the public funds depending on different parameters, such as the number of projects, the number of individuals, and the amount of money contributed (Hansson, 2011). Every month members can support different projects by voting for their favorite ones, and other users can also support initiatives without being members.

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The creator wanting to launch a project must become a member by paying a certain fee to open their account, and an additional fee designated to the public fund to support other projects. The CF platform then matches the project with the right funds via the system developed. Crowdculture’s model is based on an “all or nothing” reward model, however, if the project does not accomplish the goal, the money is designated to other projects.

The CF platform does not withdraw any fee from the projects, therefore the entire amount goes directly to the creators. Crowdculture also works with partners whom are able to contribute larger sums of money, thus deciding the criteria of the projects they wish to fund. The platform has adapted features to allow creators and users to discuss projects, most importantly, it reinforces a user base (members) interested in culture by allowing them to vote. According to Valentin (2010) in the text of Bannerman (2013), Crowdculture has created “new forms of discursive and communicative democracy by encouraging deliberation and reflection by citizens on art and society.”

The Internet and technological changes in software allowed new dynamics and services to appear in the web. This research unfolds from a perspective of the phenomenon of crowdfunding as a Web 2.0 service application; to further analyze, from an academic perspective, the influence of crowdfunding cultural projects.

As earlier stated, social progress through the participation of users is a positive perspective that can be observed in the crowdfunding phenomenon. Nevertheless, it is relevant to reflect on how the Internet has merge with economy and thus crowdfunding is also an example of this. Compared to crowdsourcing, which might have an influence in the digital economy, crowdfunding is impacting the economy with the realization of projects that are not based in the Internet. This phenomenon conveys a complexity, first, because the funding of initiatives did not occur through the Internet and secondly, the online collaboration takes place to support the realization of projects that will take part on a physical world. Crowdfunding has a set of variables to examine that are unique in its funding process; this have to do with free labor tasks, such as promoting the campaign, to the measurement of success of a project with a specific crowdfunding model. It could be argued these actions are new for artists, and thus the interest of studying creators using crowdfunding to fund cultural projects. In the case of artists, as it was aforementioned, actions that had a traditional process to collect funds from the government, now have to change to reach an “infinite crowd” in

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a digital sphere. Crowdfunding essentially functions with the same process in which creators launch a project and ask other users for funds through a CF platform. However, CF platforms do not have to narrow their features or purpose of design. The ideal would be to have a CF platform that strives for a common goal to complete the realization of projects in the industry it is promoting, as the case of the Crowdculture platform. This CF platform set up technological solutions to make its users become members that are allowed to vote and thus the relation of culture producers and funders changes. CF platforms can be considered as a service and thus, since its creation, their features and design can convey a strategy that sets the condition for users to participate. Crowdfunding platforms have a history and thus have created a discourse that attracts users to be active in the platforms and especially, users that agree with the terms proposed and with the crowdfunding model offered.

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Chapter 3. Research Design

With the aim of contributing to the study of crowdfunding in Mexico, this research investigates the crowdfunding platform Fondeadora. The focus of the study is crowdfunding cultural projects since it is the type of initiatives that have been mainly launched and funded in the platform. In this section, the research questions are presented and consequently the characteristics of the digital context and cultural funding in the country are described to further draw conclusions of the relevance of this phenomenon and its impact in funding cultural projects.

3.1 Research Questions

Most of the academic contributions have study either the creators or the funders, however, for this specific research the platform is analyzed as an active party in the crowdfunding process. From the literature review, it seems interesting to investigate how crowdfunding platforms contribute to culture making and to what extent they perform a significant gatekeeper role. To this end, this research explores the following questions:

1. What are the factors that contribute to the success of crowdfunded cultural projects in Mexico?

Creators are deciding to fund their projects through crowdfunding instead of choosing a traditional process. They must have a profile in the platform, upload a video, write updates of the campaign and promote their project in social media platforms. These activities are particular of a crowdfunding process and therefore the interest to analyze which of these and other factors contribute to the success of campaigns. The analysis of the projects is essential to answer this question and thus define a set of factors. For the purpose of this research the concept of successful is define by the projects who accomplished the funding in the time frame displayed on the platform, reaching 100 percent or more of their goal.

2. Through which community engagement features do CF platforms ensure the success of initiatives over the life span of the campaigns?

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An important facet in crowdfunding platforms is how they incorporate features for creators and funders to motivate user’s experience, the “platforms that satisfy motivational needs may ultimately encourage a more diverse group of people to launch their ideas compared to platforms that do not satisfy these motivational needs” (Gerber and Hui 24, 2013). A set of “motivational aspects” as well as “design aspects” will explain how Fondeadora strives for engagement in their platform and thus the success of initiatives. To answer this question, the research focuses on the analysis of the platform as the medium of study.

3.2 Case Study: The Fondeadora Platform

Fondeadora (https://Fondeadora.mx/) is the first CF platform in Mexico, launched in 2011. To date (17th may 2016) the platform has raised 7.1 million dollars (6.2 million euros) in total, funding 1,375 initiatives in which 91,797 users have participated. The project success rate is of 54 percent (Fondeadora.mx). This platform uses the Reward Base model “all or nothing.” Fondeadora has funded projects from Mexico and Latin America, and has its base offices in Mexico City and recently in Chile.

Fondeadora supports any initiative as long as it does not infringe the Mexican law. There are five categories in which creators can participate without paying any fee:

• Art and Culture

• Creative Industries

• Technology and Entrepreneurship

• Social Initiatives

• Donadora (personal initiatives, such as health, travel, etc.)

Creators and backers have to be login, either through Facebook or personal email to create a project or to fund a project. The alignments creators have to follow to upload a project can be found in the requirement for new projects section:

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Cover Profile

• Name and cover photo.

• Description of project (up to 160 characters).

• Location

• Goal and Time (until 90 days)

Description Inside Campaign Page • Video and Photos

• Description of Project

• How is the money going to be used

• Description of Creator

• Risks

• Rewards (what types of rewards and when are they going to be delivered)

• Contact (email and phone number obligatory)

In the section “terms and conditions”, Fondeadora gives some recommendations to the creators, such as daily activity either in the site or in social media channels and it is stated in the contract they can ask the creators to be active on their profile, posting at least two times per day. On the other hand, Fondeadora can help them by creating a communication strategy. They also demand the creators a follow up report of the project if they successfully raised the funds. For the funders, there are several payment methods, including regular transfers by bank, as well as PayPal and direct payments in a popular convenience store “OXXO”. At the end of the recollection of funds, Fondeadora takes a transaction fee of 6.5 percent.

Fondeadora is active in social media channels, such as Facebook (80,935 fans), Twitter (26.1 K followers), Instagram (1,642 followers) YouTube (256 followers), and Vimeo, and has a daily newsletter. Throughout the years Fondeadora has created strong partnerships with universities, as well with banks and several Foundations. Along the process they have created an image that depicts a discourse of entrepreneurship and innovation.

The features described in this platform are very similar to the description of the crowdfunding platform Kickstarter (see Kuppuswamy and Bayus 2015), which indicates how the initiatives in developed countries are follow by developing countries. Past research on Kickstarter

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is used as a guide of comparison to analyze what dynamics are similar or differ from the CF platform from the US and Fondeadora.

Figure 1: Traffic Rank by Alexa.com (accessed 4/22/2016)

3.2.1 Relevance of Fondeadora in Mexico Analyzed Through Google Trends

The results of Google search engine as an “authoring device” (Rogers 86, 2013) illustrate the relevance of crowdfunding in Mexico in a digital context. The searches for “crowdfunding” and “Fondeadora” throughout the years are shown in google trends, which “provides a time series index of the volume of queries users enter into Google in a given geographic area” (Hyunyoung and Varian, 2012).

Figure 2: Google Trends by Year in Mexico 2011 - 2016

Figure 2 shows the terms [Fondeadora] and [Crowdfunding] from 2011 to 2016. The search for Crowdfunding has a steady grow overtime, while the search for Fondeadora which

0 10 20 30 40 50 60 70 80 2011 2012 2013 2014 2015 2016

Google Search by Year

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shows increasing results compared to 2011, has important peaks in 2014 and 2016. This is related to campaigns that had an important media buzz (Yep, Victor. Personal Interview. May 04 2016). The campaigns also had an effect in the increment of visits to the site.

Figure 3: Analytics of Total Visits to Fondeadora.mx from Jan 2012 to Jan 2016 (Provided by Victor Yep)

Top Search Terms for Fondeadora

201 1

201 2

2013 2014 2015 2016

Fondeadora Arca La Fondeadora Fondeadora Mexico Fondeadora Mexico

La Fondeadora Fondeadora MX La Fondeadora Fondeadora Pelusa

Caligari

Fondeadora TV Fondeadora MX

Fondeadora MX Fondeadora

Supercivicos

Fondeadora Chile Fondeadora TV

Table 1: Related Terms to Search Term Fondeadora (google.com/trends/)

Until recently, 2015, Google Trends shows more search terms related to Fondeadora. This terms indicate Fondeadora has been positioning itself as a CF platform and some of their products, such as TV and their presence in Chile. There are three products of Fondeadora that were of interest for the users, which are Arca, Pelusa Caligari and Supercivicos, the last two in 2016. These last terms are from popular campaigns with known personalities in Mexico. “Pelusa Caligari” is a project in collaboration with one of the major YouTube influencers (Werevertumorro) in Mexico. The second campaign “Supercivicos” is conducted by a TV celebrity who is promoting the compliance with civil laws. Richard Rogers argues that “google effects are media effects” (21, 2013) and this can be observed in the results for the term Fondeadora.

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3.3 Context in Mexico

The study of the CF platform is not the representation of the online social habits of users in the country, nevertheless the context is described to understand the evolution of crowdfunding in Mexico. As crowdfunding has an evolution, the internet user base and dynamics have also changed over time.

Figure 4: Internet Users in Mexico 2015 (Internet Mexican Association)

Figure 4 is a graph from the Asociación Mexicana de Internet (Mexican Internet Association - AMIPCI) which shows the active Internet users, men and women 13 years old and older, from 2006 to 2014. In this figure the number of active users has increased steadily per year showing a total of 53.9 million users by 2014. According to the Interactive Advertising Bureau (IAB) and its annual study with Millward Brown, in 2015, the total Internet user base reached 68 million Mexicans, which represents 57 percent of the total population. AMIPCI reported their main online activity is accessing social networks (85%), followed by searching information (78%), and sending/receiving email messages (73%).

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Crowdfunding has been increasing since 2011 under specific circumstances in Mexico. A

report from the Multilateral Investment Fund (MIF)5 with support by Massolution6 in 2014 showed

that the development of crowdfunding depends on elements, such as participation in social media networks and e-commerce, usage of digital devices, technological knowledge and entrepreneur formation, which has a direct effect in the disposition and capability of the users to get involved in a new economy as funders or creators.

According to MIF, there are two major aspects to consider in a digital context in Mexico: firstly, the participation in e-commerce, and secondly, the low level of trust in Internet-based technologies. The users’ participation in e-commerce is highly linked to the banking system of the country. According to MIF, “only 27% of people older than age 15 have a bank account (compared to 56% in Brazil, and an 88% in the US), and only 13% of people older than age 15 have a credit card” (41, 2014). This figure represents less than 25 percent of the total population owning a credit card. The low usage of bank accounts combined with the difficulty to receive bank loans, and/or the high rates of microfinance institutions represent a convoluted landscape for entrepreneurs and small ventures to start their business. A financial exclusion is evident in a high percentage of the Mexican population, thus the activity of participating either by funding or raising money through crowdfunding conveys a lack of knowledge about online transactions. Supporting “confidence in the security of digital systems will have a strong influence on [users] willingness to engage in online crowdfunding” (MIF 58, 2014).

On the other hand, the dynamics of cooperation are part of the Mexican culture in an offline context, for instance, “the tanda custom, [pursues collective action with] a form of rotating savings and credit association, […] which indicates a strong linkage to crowdfunding” (MIF 58, 2014). Another evidence of cooperation within the Mexican culture is that 2 percent of the gross domestic product (GDP) is destined to donations, people donate around 500 pesos7 per year to different programs, as informed by Federico Arellano (founder of crowdfunding site Micochinito). Federico Arellano articulated that the community does provide support via donations, however, the ideal would be to help more people to participate in crowdfunding platforms. Moreover, “there is a clear necessity to work on a vision and organization of funding into the right projects through online

5_{The Multilateral Investment Fund (MIF) is a member of the Inter-American Development Bank (IDB), as part of an effort to}

promote the sustainable evolution of a financial ecosystem surrounding Mexican MSME.

6_{Massolution is a research and advisory firm specializing in crowdbased solutions.} 7_{1.00 EUR = 20.5 MXN Currency at 2016-05-27 20:09 GMT (http://www.xe.com/)}

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platforms” (Arellano, Federico. Personal Interview. 30 March 2016). Both Arellano and MIF place in a positive context the insertion of crowdfunding in the country. While Arellano mentions crowdfunding is key in developing countries given that it can be used as an empowerment tool in social programs within poor communities, MIF states, “there is an adequate foundation on which a robust crowdfunding industry may be built” (13, 2014).

The MIF report positions crowdfunding by donations and rewards as a first step for entrepreneurial projects towards developing a more mature market that will further require investing larger sums of money, a context that would be closer to the Equity model in crowdfunding. Nevertheless, the first CF platform in the country was created to support mainly the creative industry and many of the projects launched might be a one-time initiative rather than a small business.

3.3.1 Funding Cultural Projects in Mexico

To understand how users are participating in the creation of cultural projects through crowdfunding it is important to know how cultural projects are funded in a context without technological solutions, positioning crowdfunding platforms as such. To what extent is Fondeadora appropriating “spaces” that were formerly governmental or private?

In Mexico, the Consejo Nacional para la Cultura y las Artes (national council for culture and arts - CONACULTA) was founded in 1988 operating under the same structure, its “cultural policy in general [remained] stagnant since those years” (González 2015). In response to this, in December 2015 the council was reformed into a new organism call “Secretaría de Cultura” (ministry of culture). According to Tobar y de Teresa, Secretary of Culture, with the creation of this organism the administrative and bureaucratic mediations disappear, such as the Secretaría de Educación Pública (secretary of public education - SEP), which co-shared funds. By mid-term 2016 the administration will have some results regarding the new activities to better optimize resources.

Before the announcement of said new ministry, the 2015 designated funding caused criticism within the cultural sector. The Secretaría de Finanzas (secretary of finance) announced the public spending in January, with a budget cut to the culture sector of around 1,100 million pesos, from which 780 million pesos corresponded to CONACULTA, an annual rate of -9.3 percent. CONACULTA is in charge of distributing these funds to other art and cultural institutions

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throughout the Mexican territory. Since Enrique Peña Nieto was elected president in 2012 the funds to this sector have been decreasing annually.

Public Spending on Culture 2000-2015 (billions of constant pesos in 2014)

Figure 5: Public Spending on Culture

(http://www.animalpolitico.com/blogueros-el-dato-checado/2014/09/09/arte-y-cultura-para-todos/) / Spending on Culture, 2000 – 2015 (billions of pesos at 2014). Conaculta and Culture (total)

Annual Growth Rate

Figure 6: Public Spending on Culture

(http://www.animalpolitico.com/blogueros-el-dato-checado/2014/09/09/arte-y-cultura-para-todos/) / Annual Growth Rate. Culture (without Conaculta). Culture (total). Conaculta

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In an analysis of public funding for 2015 journalist Alberto Serdán argues that in the last five years the Mexican congress has increased the budget for the cultural sector, however, “such an amount of money was distributed without executive coordination of projects, without a minimum public policy behind them, and often without real beneficiaries of art”. The history of ongoing funds and inefficient management in the cultural sector in the country represents a lack of trust by the institutions. Although the new administration has changed, experts in the subject question whether the organism can function with new structural and legislative reforms. There are three major issues, which have to change within the structure: first, the creation of a strong legal framework, second, transparency of fund administration, and third, the plurality in projects. Granados, a professor in public policies, analyses the Ministry of Culture by arguing how its governmental structure would have to change, what would be its the purpose, and who would benefit from it, in this matter:

The State is not responsible for the production of culture, geniuses, nor discovering artists. The state has a duty, in any case, to create the basic conditions – absolute liberty, balanced and transparent allocation of resources, promotion, formation, among others - for creators to develop their own talent, produce their work with the highest quality, and then the public can decide whether they like it or not, and in consequence succeed or not. (2015)

González argues that the framework of patronage and cultural inversion has to change in order to promote reforms that consider culture with the concept of an industry, “the Economy and Labor Secretary recognize the cultural economy as part of the national economy ([…] according to recent studies, cultural industries contribute 7.9% of GDP)” (González).

There is also private funding, which has merged with public institutions; museums in many cases take private money from tax deductions of private companies (Rodriguez 2015). Some of the most important private institutions with their own cultural sponsorship, thus promoting culture in the country are: Fundación Jumex, Fomento Cultural Banamex and Fomento Cultral Salinas Pliego.

Fomento Cultural Banamex is the first cultural foundation established in Mexico by a financial institution (1971). Its mission is to encourage investment in cultural development, and promote and preserve the Mexican culture. Banamex has its own exhibition centre, programs

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supporting popular Mexican art, publications, funding for restoration and conservation, among others. (http://fomentoculturalbanamex.org/)

Jumex, a successful beverage company, has its own foundation, Fundación Jumex, which built a contemporary art museum in Mexico City. As stated in their website, the foundation is dedicated to the development of initiatives focused on production, research and promotion of contemporary art through funding and support of emerging, independent individuals or collective proposals and institutions. (fundacionjumex.org)

Fomento Cultral Salinas Pliego is the foundation of Ricardo Salinas Pliego, one of the most important entrepreneurs in Mexico, founder and chairman of Grupo Salinas, the largest telecommunications company in the country. Since 2001, this foundation has been dedicated to the preservation of Mexican cultural heritage in Mexico. It supports, promotes, and disseminates artistic creation with projects diffusing popular traditions and customs. (http://www.fcgs.mx/)

While private funds seem to differ more in plurality and projects supported, there is an evidence of a public system, which malfunctions, and may be limited regarding vision and budget. As in many cases around the world, applying for public funds may involve a long and thorough process; aside from the distribution of funds, the question of who decides which projects receive funding, and under which criteria is a common interrogative for culture makers (Huerta 2015). Crowdfunding has been rapidly adopted, especially in the creative industry, because it “can also be seen as a way to jumpstart creative projects without drawing on public funding and without the levels of government oversight and bureaucracy associated with traditional government funding” (qtd. In Bannerman).

To summarize this chapter, the crowdfunding platform Fondeadora is the case study for this research, which is a platform that uses the Reward-Based model of “all or nothing”. As it has been described, the country where the platform is located is Mexico and thus the relevance to analyze the context in which the CF platform is situated, to keep in mind if there are specific conditions that have influenced the dynamics of the creators during campaigns or the decision to add certain engagement features by the CF platform. The insertion of online payment methods and the penetration of online users are of sum importance for the development of crowdfunding in Mexico and therefore have to be taken into account while analyzing the CF platform, Fondeadora. Additionally, the platform emerged around 2011 and the information shows drops in funding for

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culture around the same time. This research has no intention of finding a correlation between success of projects in the CF platform and the drop of funds from the government; however, this information intends to give a keener look of what is the role of the CF platform in the process of funding cultural projects opposed to governmental institutions.

Chapter 4. Methods

This chapter presents the methods applied, which are virtual and digital methods, to answer the research questions. These methods are connected since both employ internet-based research, however, there is a difference in their approach. First to analyze the CF platform Fondeadora, the virtual method historiography of the platform overtime was conducted and the alignments followed by the researcher are described. Consequently, two digital methods were conducted. One digital method relied on the implementation of direct observation to follow the life span of campaigns. This method also required to define a scope and implementation for the daily gathering of data which is described in the chapter. Lastly, two semi-structured online interviews were conducted with the manager of Fondeadora and the founder of the CF platform Micochinito. Respectively, to further enrich the results from the progressive study of the platform and the data gathered though ethnography and direct observation.

4.1 Virtual and Digital Methods

This research positions itself in the area of new media studies, and as such employs internet-based data collection and analysis methods. This chapter distinguishes two types of methods that differ in their approach to study culture in and through the Internet.

The methods for internet-related research, according to Richard Rogers in his book “Digital Methods”, can be differentiated by researching methods born in the new medium and methods that migrated, in other words are digitized (19 2013). Online interviews, observation or surveys are digitized methods. These methods can be studied through online ethnography; this technique offers new opportunities for research online in which Internet serves as a form of social space (Hine 109, 2005). If “ethnography can successfully be applied to online contexts then we can rest assured that these are indeed cultural contexts, since ethnography is a method for understanding culture”

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(Hine 8, 2005). From a different perspective, Rogers argues that virtual methods “import standard methods from the social sciences and the humanities into the medium (Internet)” (19, 2013). According to Rogers, the virtual, study how much of culture and society are now online (37, 2013) whereas digital methods study culture and society with the Internet (38, 2103).

The “Internet [can be considered] not only an object of study, but also a source” (Rogers 21, 2013) that provides findings of culture and society that live in it. Rogers proposes new methods to research the internet as a source that require of the gathering and analysis of data. For instance, links and hypertext can be traced, a website can be research as an archived object, the web can be studied across countries by the geographical location revealed by users, among other digital born environments.

Data bases from digital methods “complement and challenge existing methods of data collection” (Rogers 22, 2013). So far, digital methods limitations are how to compare and apply the same credibility to virtual and digital sources. In a sense, the comments from an online newspaper can be considered equal to the responses of an interview. Moreover, some of the limitations in the practice of digital methods are first of all, the instability of the medium due to different software or hardware that changes over time and secondly, the rapid changes of the context of study, the actors and the medium change the variables and thus the research design might be affected.

According to Rogers, in virtual methods, ethnographers have to visit the “ground”, referring to the “real”, in order to study the web. However, to apply digital research, it is important not to distinguish the “real” from the virtual, Rogers argues. He proposes an “online groundedness” for the digital methods, which refers to research practices that can lead to firm and ground claims about cultural change and societal conditions in the web (Rogers 21, 2013).

4.2 Website Historiography

In what follows, the digital method utilized in this research is website historiography. The website Fondeadora was researched “as an approach to the study of the website as archived object in a historiographical tradition akin to the biographical” (Rogers 65, 2013). The data of the website was collected through the Wayback Machine tool (WBM), through this method, the researcher can retrace content and features from the web page and thus analyze the site as the medium of study.

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The WBM is the search interface for Archive (archive.org) that contains around 478 billion pages saved to be access and studied. It is useful to collect websites through this interface because:

Most societies place importance on preserving artifacts of their culture and heritage. Without such artifacts, civilization has no memory and no mechanism to learn from its successes and failures. Our culture now produces more and more artifacts in digital form. The Archive's mission is to help preserve those artifacts and create an Internet library for researchers, historians, and scholars.11

To use the WBN a URL must be entered which will redirect to an interface with the saved pages of that site. As described by Rogers, “what is returned is a list of stored pages associated with the URL from the past in a calendar mode. Next to a date, an asterisk indicates that the archived page is different from the one previously archived” (65, 2013). The interface crawls the web and captures the images of individual webpages, nevertheless not all the changes of a page are archived, which means the history of a page might not be 100% register. Through the years, different software has been utilized and this can be reflected in the sites by not showing certain features, like Flash videos, for instance.

Defining Scope

By querying [Fondeadora.mx] the WBM shows 215 results of the website saved. The platform was analyzed starting in May 2011, when the website was launched and the tool shows the first snapshot. The process to explore the site was looking into the snapshot of the day of May with more images saved, thus to track the same month per year. If may did not have any results, the day with more snapshots was taken into account for the analysis. Additionally, from the homepage, the project that was depicted in home was analyzed, redirecting to an inner page. This process was done from 2011 to 2016 and screenshots of each year were saved. The second step was to analyze the section “Discover” which is the one were all the categories are shown. This section has 36 snapshots saved starting in 2012.

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With this technique a website can be describe over time with a focus on structures and features that make up the interface of the website and by interpreting its substance and priorities. The substance on a website refers to “lists of issues, campaigns, missions, slogans, services, products, etc. that reside on the front page and organize the content of the website” (Rogers 70, 2013).

To analyze the substance of the website the features observed were the content depicted in the homepage, such as slogan and funding information. To analyze the structure of the website the features observed were: main categories, sorting of projects, feature projects, link to social media networks, new forms of payment added, list of countries involved and partners. With an overview of the different aspects of the medium, the platform can tell its own story, “even a seemingly

‘static’ display such as a web site may well in fact be the product of intense social organization,

brokerage and exchange, revealing quite a different story from what might appear on the seemingly placid surface of a site” (Forte 94, 2005).

4.2 Unobtrusive Online Observation

As part of a qualitative research that “aims at providing an in-depth and interpreted understanding of the social world of research participants by learning about their social and material circumstances, their experiences, perspectives and histories” (Snape and Spencer 3, 2003) the analysis was carried out through the virtual method of observation. There are two type of observation techniques, participatory and unobtrusive, the second one was more appropriate for the purpose of this research since it doesn’t “require the researcher to intrude in the research context” (Trochim 2006). In this research the observation is situated in an online context in which “the Internet creates the ideal conditions for unobtrusive observation as demanded by the complete observer role” (Nørskov and Rask, 2011). The role of the researcher as an online direct observer allowed the conduction of the research to have a focus on the daily activity of certain projects and the actions performed by the creators and the platform.

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Defining Scope

The Crowdfunding platform, Fondeadora, has hosted around 590 projects under the category “Art and Culture” and by the month of April, 53 projects were active. Fondeadora states in its website that a project that reaches a 15 percent of total funds has an 85 percent opportunity of succeeding. Based on this information and the latest study of Kuppuswamy and Bayus (2015), that focused on the cycle of campaigns to understand the action of backers, this research was conducted but retrieving a minor scale of data and focusing on the actions of creators and the platform. For the purpose of the methodology, 21 projects that were located in the ranking “Popular Projects” that had already a 15 percent or more of funds raised were taken into account to follow up for 24 days (from 13th of April to 6th of May). These dates were chosen to have a viable timeframe of study and to aim the conclusion of most of the projects analyzed.

The features considered for data collection by day were: progress of funds, number of backers, days left, comments, updates, and in case they counted with social media profiles, the activity of creators in these channels. To analyze if the platform can have an effect in the success of projects, the features considered were: posts of projects in the official Facebook or Twitter of Fondeadora, featured position in the homepage, either on top or most funded projects, feature project of the week in the section “Art and Culture” and “Favorite” label in cover picture. The results from this method shed light into patterns of the creators to complete a successful campaign. Hine also argues that the internet can challenge researchers to narrow the distinction between qualitative and quantitative methods by tracing the online activity and hence collect data and explore patterns to understand what people do online and the significance of their actions (110, 2005).

4.3 Semi-structured Online Interviews

Connected to virtual methods, online interviews were also used in this research. This method is “suited to research that requires an understanding of deeply rooted or delicate phenomena or responses to complex systems, processes or experiences because of the depth of focus and the opportunity they offer for clarification and detailed understanding” (Ritchie 36-37, 2013).

Crowdfunding Cultural Projects in Mexico