At the juncture of funding, policy, and technology: how promising is match-funding of arts and culture through crowdfunding platforms?

ABSTRACT

Despite its ubiquity in arts and culture, crowdfunding has limitedly been instrumentalized in policy settings. Yet, with joint contributions by friends, fans, governments, and quasi-public institutions, match-funding of arts and culture through crowdfunding platforms may have benefits: increased revenues for makers and cultural fields, transparency in funding allocation, and stronger community engagement. Drawing upon interviews with regional and local match-funding entities in the Netherlands, we explain how and why they engage in match-funding and what is needed for the collaborative funding mechanism to thrive. Funders are attracted by match-funding’s potential to support relatively large numbers of hitherto underserved makers with relatively small amounts of money, complementary to other funding instruments. Aspects largely overlooked are match-funding’s capacity to leverage resources and install co-decisive processes of public funding allocation. Situated at the juncture of funding, policy, and technology, match-funding requires learning and experimentation with other than reward-based formats to unleash its democratizing potential.

KEYWORDS:

• Match-funding
• crowdfunding
• subsidies
• collaborative funding
• democratization

Introduction

The cultural field is permeated by new funding models, benefiting from technological advancements and the potential to ameliorate the earning capacity of creative and cultural workers and organizations (Katz-Gerro 2015; Loots et al. 2022; O’dair and Owen 2019). Online crowdfunding is an example. It is coordinated through two-sided platforms that permit cheap, fast, and easy financial transactions and the creation of global fanbases for products and services (Alexiou, Wiggins, and Preece 2020; Josefy et al. 2017; Lazzaro and Noonan 2021). Two types of crowdfunding are commonplace. First, crowdfunding (or crowd investment) may unlock entrepreneurial opportunities through its capacity to raise capital infusions from investors as well as the public without any geographical restrictions (Bargoni et al. 2022; Belleflamme, Lambert, and Schwienbacher 2014). Second, crowdfunding projects in the civic realm are typically ‘crowdfunded projects that provide services to communities’ (Davies 2015, 343) in which the goods produced are expected to be goods to be consumed equally by all members of the community that funds them.

Recently, local and regional policymakers have started to engage with the potential of crowdfunding by integrating crowdfunding practices into their funding toolbox. In its most simple form, this happens through matching a part of a project’s target goal. That is, contributing a part of the requested sum – at the beginning, midway, or the end of the crowdfunding campaign. In this sense, match-funding can be considered a ‘collaborative funding mechanism’ (Senabre and Morell 2018, 5), involving contributions by government and quasi-public institutions including independent foundations, funds, lotteries, and public-run organizations, next to money from crowd and private contributions. Match-funding schemes have better success chances than crowdfunding because of the extra funding that comes available (Davies 2015; ECN 2018; Van Montfort, Siebers, and De Graaf 2021). Furthermore, when local authorities match in civic crowdfunding projects, individual funders of local communities feel supported and empowered. Its advantages have been related to increasing citizen participation and a sense of ownership, visibility, accountability, employability, entrepreneurship, and the alleviation of poverty and discrimination (ECN 2018).

Yet, as match-funding is a recent endeavor, little is known of how, why, and with which presumed effects regional and local funding agencies and governments engage in match-funding. The nature of crowdfunding and match-funding practices may stand in contrast with the procedures of public administration: administration often possesses limited adaptability to flexible, agile, technology-driven ways of collecting and distributing financial resources, tempering their development and adoption (ECN 2018). Furthermore, match-funding may provoke fundamental questions of responsibilities, quality assurance, and public choice: the matching principle leads public money into directions that may have been different were other decision-making practices installed. These fundamental issues have not yet been raised in cultural policy, while local authorities have begun to experiment with match-funding arts and culture.

In the Netherlands, most crowdfunding in arts and culture is coordinated through a specialist platform: voordekunst. Research into the platform’s practices revealed that the general interest (civic) and artistic development are key motivators for private contributors to pledge (van den Hoogen 2020). Not much is known, though, of the aims and efficiency of match-funding of arts and culture through platforms.

Drawing on interviews with representatives of local governments and private funds who offer the perspective of the match-funder, the present paper offers a more comprehensive view of the intersection between funding, policy, and technology in arts and culture. The leading research question is: What are the motives and perceived opportunities and challenges of integrating match-funding in (local and regional) cultural policy?

Literature

Crowdfunding

The funding mechanism of crowdfunding works through ‘an open call, mostly through the Internet, for the provision of financial resources either in the form of donation or in exchange for the future product or some form of reward to support initiatives for specific purposes’ (Belleflamme, Lambert, and Schwienbacher 2014, 588). Technically, most crowdfunding occurs on online platforms that provide payment and project management tools that allow collecting money from donors, lenders, and/or investors, and that channel money to project owners (Röthler and Wenzlaff 2011). The applications are numerous; however, two types are conspicuous in the rich crowdfunding literature.

First, in the entrepreneurial sphere of small businesses and start-ups, crowdfunding allows proponents of projects with a lucrative potential to generate interest and link them to potential investors (Camilleri and Bresciani 2022). Due to the availability of alternative funding irrespective of the endorsement of traditional financial intermediaries, crowdfunding may enable entrepreneurial opportunities also for ‘main street entrepreneurs’ and those underrepresented owing to socio-demographic features or being located in underserved regions and sectors (the democratization of entrepreneurship) (Le Pendeven, Morel, and Leboeuf n.d.; Mollick 2014). Entrepreneurial crowdfunding has been situated as a practice that contributes to the democratization of funding because it permits, alternatively to venture capital, less wealthy individuals to equally contribute to innovation (Stevenson, Kuratko, and Eutsler 2019). Moreover, it has been framed as a way of testing markets and go-to-market strategies, determining prices for products that are close to entering a consumer market, and thus reducing the uncertainty about aggregate demand (Bargoni et al. 2022; Belleflamme, Lambert, and Schwienbacher 2010). By stimulating reciprocal information flows between entrepreneurs and crowdfunders, crowdfunding is well-suited to support the statements in radical and incremental innovations in traditional as well as alternative sectors (for example, green innovation) (Bargoni et al. 2022).

Second, from an economic and welfare perspective, ‘civic crowdfunding’ enables citizens to take part in often locally embedded, ‘common good’ projects: jointly funding a project leverages close ties and engagement within local communities (Davies 2015; ECN 2018; van den Hoogen 2020). Projects initiated in the civic realm or other non-profit contexts are typically non-rivalrous in consumption, associated with donation-based or reward-based crowdfunding, and supported by ‘backers’ with a preference for charity or aesthetic projects (Alexiou, Wiggins, and Preece 2020; van den Hoogen 2020).

Next to global and thematically unconstrained crowdfunding platforms that are largely search tools for capital, industry-specific ‘niche’ platforms have come into existence that serve specific industries, segments, or communities (Bargoni et al. 2022). These may be not-for-profit and supportive of the many projects in the platform economy that are rather small, Do-It-Yourself, or amateur (Cicchiello, Gallo, and Monferrà 2022; Vallas and Schor 2020). In the arts and culture sectors, such platforms could provide an alternative to powerful gatekeepers such as record labels in the music industry (Galuszka and Brzozowska 2017). These platforms are appealing to project owners who typically operate in niches or the ‘long tail’ of cultural sectors and try to find financing that is not available via traditional institutions, including subsidies, banks, and risk investment (Handke and Dalla Chiesa 2022; Rykkja et al. 2020; Van Teunenbroek and Bekkers 2020), for developing a stage performance, recording an album, or producing a batch of new design products. Typically, in-kind rewards are offered, such as products (a book, a design object) or tickets to an event.

Crowdfunding can potentially take up a role in forms of participative production and policy, with citizens’ contributions as a proxy for citizens’ preferences. Röthler and Wenzlaff (2011, 5) explain the impact of crowdfunding on the premise that ‘it transfers models of informal co-operation to the world of financing and leads to democratization and transparency in financing.’ Additionally, although its core association is with funding, the crowdfunding mechanism could address some key concerns of democratic governments such as participation, social equality, and redistribution.

Despite its potential global reach on international platforms, project owners and crowdfunders frequently share their local environments. This makes crowdfunding typically connected to local communities and localities (Belleflamme, Lambert, and Schwienbacher 2014). Supporters of crowdfunding frequently belong to a small circle of family and friends (Borst, Moser, and Ferguson 2018; Mollick 2016), yet also investors have a preference for nearby projects (He et al. 2019). In crowdfunding of the arts, it was demonstrated that local rather than international donors play a decisive role in the success of campaigns (Dalla Chiesa 2021). As a result, the local cultural policy may be particularly fit to engage in the crowdfunding of arts and culture. Here match-funding comes in.

Match-funding

Match-funding in the present context is a method by which governments or (semi-) public funds become involved in supporting projects that seek funding via crowdfunding platforms (De Voldere and Zeqo 2017). It results in public-private partnerships that pair creative ideas of individuals or groups with financial support from their backers, governments, and quasi-public institutions, facilitated by technology. Whereas crowdfunding is considered a method of online collaboration, match-funding is framed as a ‘collaborative funding mechanism’ in the realm of other systems such as ‘municipal participative budgets, social currencies, and digital time banks’ (Senabre and Morell 2018, 5). One of the first studies of match-funding predicts that it may become a tool that facilitates ‘coordinated collective and institutional action in the participatory assignment of resources, with an open data mechanism and transparent management’ (Senabre and Morell 2018, 4). Cities and their local authorities were frontrunners in match-funding, soon followed by foundations, funds, and lotteries (ECN 2018). Goteo in Spain, KissKiss-Bank in France, and Indiegogo in the US were the first platforms experimenting with match-funding.

Surveying 39 European platforms for cultural projects, De Voldere and Zeqo (2017) find that match-funding partnerships are mostly set up to increase the success rates of campaigns by engaging public investors that are munificent in their support, or to have public or private investments acting as leverage. In a study of the Goteo-pilot, Senabre and Morell (2018, 3) suggest that match-funding may be organized in a way that creates ‘appropriate dynamics for channeling significant amounts from public or private funds through a donation system that facilitates public participation above and beyond what the funds themselves could achieve.’

In that respect, the timing of the match-funding during the campaign can strategically be used to influence such outcomes (Baeck, Bone, and Mitchell 2017; Baeck and Mitchell 2016). There are three ‘temporal’ models for match-funding. ‘In first’ implies that the matching partner reduces initial financing constraints and commits its support up front. In this manner, the (public) support can serve a signaling function or create a ‘flywheel effect’, by reducing uncertainty in backers’ minds and attracting private contributions (Bargoni et al. 2022). The ‘top up’ model works the other way around: after a project has given proof of its support by private crowdfunders, the matching entity tops up the missing budget, in a way underwriting consumers’ preferences. In the ‘bridging’ model, the matcher intervenes after the first stage of the crowdsourcing, yet before the final stage. The idea is that the matching contribution serves as a boost to the campaign and relies on the insight that the crowd is likely to give at the start or the tail of campaigns. Projects in the entrepreneurial and civic realms may require distinct approaches, though, owing to their diverging aims, funders, and financing mechanisms (Table 1).

Table 1. Match-funding types.

	Match-funding	Models
		In first	Bridge	Top-up
Is?	Collaborative funding mechanism	Match contribution first	Match contribution provided during the campaign	Match contribution at the end
Why?	Increasing project budgets; Increasing participation	Signaling function; Reducing uncertainty; Leveraging potential	Boosting	Following public choice
Reflection of?		Transparency of public funding; Certification		Participatory resource allocation

Match-funding is believed to have benefits for public and private funders, and project owners. First, match-funding makes crowdfunding more effective and more financially successful (De Voldere and Zeqo 2017; ECN 2018). Many crowdfunding campaigns do not reach their targets, meaning that significant committed amounts of money are not assigned to campaigns (Senabre and Morell 2018). Match-funding leads to a larger aggregate sum and can act as a signal of the trustworthiness of a campaign, which, similarly to early contributions and the social capital of project owners, can trigger herding behaviors leading to more contributions (Skirnevskiy, Bendig, and Brettel 2017). Second, match-funding may affect the levels of citizens’ participation and commitment owing to its potential to merge contributions from private and public origin. ECN (2018) epitomizes that the match-funding instrument allows for engaging citizens in policy decisions, when it is needed to involve them, for example in developing regional agendas (De Voldere and Zeqo 2017). Match-funding may open the options that authorities activate about economic development and social inclusion, and strengthen the relationships and cooperation with various local stakeholders (ECN 2018). This is especially the case when a government ‘tops up’ onto the intermediate contributions that express public choice. Third, relying on crowdfunding systems, match-funding may reduce the search costs for public and private funders, in particular the transaction costs of looking for projects and ideas in line with cultural policy objectives. Typically, the platform administers projects, communication, and transfers. A fourth selling point of match-funding is its potential impact on the local economy, being an alternative for the global ‘delocalization’ dynamics resulting from the dominance of large platforms (Senabre and Morell 2018).

Despite its increasing importance and relevance, match-funding is in its infancy and not pervasive in the realms of arts and culture. Potential barriers may be the need for technology, lengthy negotiations with platforms, and limited available time or knowledge (De Voldere and Zeqo 2017). The lack of understanding of the mechanisms and advantages of match-funding, including its empowering and connecting potential, was identified as a key obstacle (ECN 2018). This is in line with what Rykkja and Bonet (2020) find in the contexts of Spain and Nordic countries, that ‘public authorities may perceive crowdfunding more as marginal financing mechanisms used by cultural projects unable to access other sources of funding, than a supplement for the reduction or stagnation of public funds.’ While match-funding can involve non-refundable subsidies, loans, and investments, it is imaginable that public authorities and funds are reluctant to commit to match-fund projects for a longer term or when they possess a more ambiguous legal status. A lack of harmonization in regulatory systems for crowdfunding across countries, and in concomitant fiscal regimes, financial incentives, payment systems, intellectual property rights, and data protection (Lazzaro and Noonan 2021), as well as the fact that projects with presales would be subjected to VAT collection (Rykkja and Bonet 2020) may hamper the implementation of match-funding.

Context, methods, and data collection

Context: cultural policy and funding in the Netherlands

Cultural policy in the Netherlands is a mix of an architect and patron model that seeks to fund the arts through arm’s length arts councils, ministries, and departments of culture, respectively (Hillman and McCaughey 1989; Minnaert 2018). The Dutch cultural policy is generally dispersed across three main lines of action: (1) On the national level, there is the support of a national basic infrastructure, in which organizations and institutions are funded because of their vital function in the Dutch cultural landscape (cf. the architect model). (2) Six main ‘cultural funds’ support particular cultural fields, such as the performing arts, film, and architecture (cf. the patron model). (3) Specific policy programs are developed and executed with other partners (e.g. public or private, or specific ministries) (Ministerie van Onderwijs, Cultuur en Wetenschap 2013).

On the regional and local levels, provinces and municipalities provide 71% (60% municipalities, and 11% provinces, see Goedhart and Zwart 2022) of the public funding for culture and are an essential pillar in Dutch arts and culture funding. Municipalities are typically responsible for the local cultural policy and facilities for cultural education and amateur art, for example, venues for performing arts, local museums, and libraries. Provinces subsidize culture that is deemed important to the region, such as cultural education and heritage. Dutch cultural policy has a cyclic nature. Every four years, cultural policy, funding procedures, and recipients are determined in a so-called ‘cultuurnota’ (cultural policy plan). Organizations and makers active in the municipality will have to apply for funding, which a limited number of organizations will receive. Besides cultural policy on the national and local levels, private funds have a profound influence on the funding of Dutch culture. Examples are endowment funds such as the Prins Bernard Cultuurfonds, VSBfonds, or the Elise Mathilde fonds, which contribute to flagship projects but also distribute stipends to emerging and renowned artists.

In the past decades, Dutch cultural policies have been characterized by extensive austerity measures and pressures to shift responsibilities from the national government to elsewhere in society (Schrijvers 2018). As a result of profound budget cuts of over 20% in 2011, pressures on cultural organizations, as well as individual makers, increased to become more entrepreneurial and strengthen their ties with other partners (i.e. private parties and ‘society’ at large) (Schrijvers, Keizer, and Engbersen 2015). Schrijvers (2018, 245) writes that ‘income [received outside of government funding] has become a proxy for societal support.’ This also shows, for example, in the Gift and Inheritance Tax Act [Geefwet], which sought to encourage donations from society to culture. Match-funding requirements (as in minimum standards for own income as a precondition for receiving subsidies) were almost, but eventually not, adopted in the Dutch cultural policy (Loots 2015). Instead, the processes of value exchange in private and collective patronage as well as crowdfunding are extensively being explored, and mixed financing is encouraged by various semi-public support structures (van den Braber 2021).

The present study scrutinizes one way that is thought to leverage such donations from society: funding arts and culture through crowdfunding platforms. In the Netherlands, crowdfunding is conceived as a means to mitigate declining budgets for the cultural sector as well as a way to bridge the gap between art and the market (van den Hoogen 2020). Specifically for the Netherlands, match-funding is increasingly prominent in crowdfunding in the arts and culture. It provides a way in which local cultural policies could support weaning cultural organizations and makers off the subsidy by tying funding to gifts from the crowd (Schrijvers 2018; Van den Hoogen 2018). As a result, an increasing number of local governments are including match-funding as one of their funding measures in their ‘cultuurnota’. Although a minority of municipalities and provinces fund through match-funding, three of the largest Dutch cities and five of twelve provinces do so.

The majority of cultural and creative campaigns are announced via the crowdfunding platform voordekunst.¹ Since its launch in 2010, voordekunst seeks to realize two main goals: to stimulate entrepreneurship of the creatives and institutions for which it supplies the platform and financial training and to increase society’s support for arts and culture (Borst, Moser, and Ferguson 2018; Van den Hoogen 2018; Van Teunenbroek and Bekkers 2020). By 2022 over 5,000 project owners were supported with over 39,5 million euros by 400,000 funders. Voordekunst takes up an active role both in training and advising artists engaging in crowdfunding campaigns, and in ‘recruiting’ local and regional authorities and foundations as matching partners.

Data collection and analysis

We interviewed the director of voordekunst twice and conducted six interviews with public officials at local governments and representatives of foundations who implemented match-funding. Finally, one official of a local government similar in size that has not implemented match-funding was interviewed (Table 2). At the time of writing nearly 20 partners are officially involved in match-funding, out of which eight are local or regional policy-related partners (municipalities or provinces involved in the funding of arts and culture procedures, or regional dependencies of the aforementioned endowment funds), making that a considerable proportion is covered by the interviews.

Table 2. List of respondents.

Number	Position	Organization type	Public/Private	Location	Date of interview	Typical quote	Contribution	Model	Values (in €) 2019
1	Subsidy coordinator	Fund	Public	Province	29/04/2020	There is a sort of staircase. So, you can start with crowdfunding, which is the most accessible.	Always 30%.	Top up after 70% is reached with a minimum of 20 donations	Not applicable yet
2	Director	Fund	Public	Municipality	15/05/2020	You can also see that if there are a lot of subsidies available, that predominates. As soon as it stops, alternatives are sought.	Max.40%	Bridging	Min: 1760 Max: 4000 Mean: 3140
3	Senior cultural policy advisor	Government Authority	Public	Municipality	19/05/2020	We entered this partnership with voordekunst because we want to have a palette of forms of financing.	Max. 25%	Bridging	Min: 145 Max: 3500 Mean: 1435
4	Staff member	Fund	Public	Municipality	22/05/2020	The flexibility and the speed are, I think, the added value of it.	-Max. 25% -Max. € 5000	Bridging, timing is unspecified	Min: 250 Max: 2500 Mean: 895
5	Policy and project employee	Fund	Public	Municipality	02/06/2020	It is not a structural source of income and I think that we, at least as a municipality, have a very big responsibility in terms of structural income.	Not applicable
6	Director	Fund	Public	Municipality	10/06/2020	I think that match-funding fits the profile of a private fund much better than that of a public fund.	Always 25%	Bridging, when 40% is attained	Min: 250 Max: 2375 Mean: 983
7	Project and program leader	Government Authority	Public	Province	11/06/2020	In the change towards more cultural entrepreneurship and greater democratization of the arts sector, we have been looking for instruments to support this.	Always 30%	Top up after 70% is reached with a minimum of 20 donations	Min: 420 Max: 6000 Mean: 2010
8	Secretary	Fund	Private	Province	22/06/2020	We are reaching a target group that we would otherwise not reach.	Max. € 750	Bridging	Min: 150 Max: 750 Mean: 613
9	Director	Crowdfunding platform	Private	Municipality	13/02/2020 06/11/2020	The sector is just not ready to start running campaigns like this, replacing subsidies.			n.a.

Due to COVID-19 restrictions at the time of research, each but the first interview has been conducted online via Zoom. The data was collected in the form of semi-structured interviews. Based on the literature review, the interview guide was pre-structured according to three main topics: (1) the practical organization of the partnership with voordekunst (Röthler and Wenzlaff 2011) including questions regarding the budgets and timing of funding (Baeck et al. 2017; Baeck and Mitchell 2016), the task division between match-funders and voordekunst, monitoring, and the gatekeeping function of match-funders (Mollick 2014; Galuszka and Brzozowska 2017), (2) the current drivers and barriers of match-funding (De Voldere and Zeqo 2017; Senabre and Morell 2018; Skirnevskiy, Bendig, and Brettel 2017) and the current position of match-funding within the participating organization and the broader field of subsidies and funding (Rykkja and Bonet 2020), and finally, (3) the potential and future of match-funding. The incremental insights gained in the matter led us to engage with additional literature and allowed for more specific follow-up questions. The Appendix entails the interview guide.

Interviews were conducted in Dutch (quotes included have been translated), transcribed, and coded using the program Atlas.ti. In coding, a constructivist grounded theory approach was followed aimed to derive most of the codes from the data, while remaining sensitive to the important and relevant concepts from the literature (Charmaz 2006). A first open analysis yielded more than 300 codes, which were reduced to 16 axes that were summarized under three overarching themes discussed in the findings: organization of match-funding, match-funding in cultural policy, and barriers to implementing match-funding.

Findings

Organization of match-funding in arts and culture in the Netherlands

Though the idea of match-funding seems to be quite simple – a partner matches part of a campaign through her participation on a crowdfunding platform – the actual practices of match-funding exhibit similarities as well as dissimilarities. All participating authorities pay a fee for the partnerships that come about through the platform. In return, most of the administration is handled by the platform. The agreements with voordekunst include criteria for the selection of projects eligible for match-funding. The primary criterium for all interviewed partners is the local or regional relevance: project founders should be from the locality, organize their project there, and/or execute an idea that resonates with the place. The selection procedures and financial allocations are more idiosyncratic. Voordekunst in some cases selects and forwards potentially relevant projects or campaigns to the matching partners. Partners then receive a short amount of time to decide on whether to support a project. In other cases, voordekunst chooses the projects, and partners rely on its expertise and qualities as a selector. Voordekunst arranges the financial disbursements.

Municipalities and funds in 2019 allocated budgets to match-funding between 12,500 euros and approximately 42,500 euros. The match-funded contributions stretched from 145 to 6,000 euros to project budgets from 1,000 to 40,000 euros. Approximately 200 projects were match-funded by the entities included in the present investigation. The majority of projects were in music (75), followed by theatre and dance (32), photography and film (29), publications (25), visual arts (21), and a few in heritage, design, and other forms. The average project budget was 6,570 euros. Jointly, these projects sought and found almost 1,3 million euros of support, of which nearly 200,000 euros was provided by match-funding partners. The totality of match-funding contributions acquired by voordekunst in 2019, beyond the match-funding entities in this research, amounted close to 250,000 euros. Whereas it cannot be affirmed if these 200 projects could only have been realized due to match-funding or whether match-funding has been able to crowd in private contributions, it is a fact that they have been realized beyond the traditional subsidy schemes and with around 15% of public support.

The budget sum made available by matching partners is often set for a year. This means that once it is allocated, projects can no longer benefit from the matching fund. When matching partners agree that projects fit their goals, a specified proportion of the project budget is matched. None of the partners apply the ‘in first’ approach: two top up and the others ‘bridge’ their contributions to the budget. Three approaches came to the fore. A respondent (#1) stated that they support a fixed budget share of 30%, which can stretch from 1,500 euros to 20,000 euros in contribution. Another municipality decides in dialogue with voordekunst which projects obtain funding – based on the selection criteria, most specifically local embeddedness and a nebulous notion of quality – and they agree on an appropriate amount for the matching contribution. In other cases, the matched contribution is fixed or dependent on the type of the project or multiples of 100 euros with a predetermined maximum.

Applicants that engage in match-funding must meet regulatory requirements and make administrative efforts. Usually, these are more demanding compared with regular crowdfunding campaigns, yet less demanding compared with subsidy applications. Matching partners must manage applicants’ expectations, because, according to a respondent (#1), ‘ … applicants are not always aware of the fact that it involves public money, and that we need to collect some essential information because of this reason.’ The administration required of the matching partners is limited because the platform takes over the work. As the director explains:

A small application requires a lot of work, time, and effort to process everything. Increasingly more so, our matching partners testify that the fact that we arrange all this is helpful. We organize everything: we manage the applications, we assure the donations, and we take care of the financial part. We take care of everything.

The collaboration with matching partners is largely pursued by voordekunst. For local authorities, the partnership is beneficial because many local makers and artists can be reached with a relatively small budget. The involvement of a matching partner improves the chances of projects being fully backed and more cultural activities at the local level (ECN 2018). For voordekunst, the success rate of projects and financing raised is their ‘marketing tool’ vis a vis other platforms.

The position of match-funding in local and regional cultural policy

A prominent finding is that respondents perceive match-funding to be a tool in a much bigger local arts and culture policy toolbox. Explaining their engagement with match-funding, they often relate funding instruments to other cultural policy instruments and types of applicants:

Various financing formats are part of the ‘impulse money program’. Someone can apply for a subsidy. With a ‘knowledge voucher’, a coach can be hired to learn more about entrepreneurship. There is a (distinct) ‘makers’ settlement’, and then crowdfunding. Crowdfunding is a subsidy variant in which a match is made. (#1)

Another partner engages in match-funding to be able to offer a wide range of funding opportunities to citizens – project subsidies, loans, prizes, and match-funding – and describes the aim of such a ‘palette’:

With the palette, we want to be able to tailor it toward various target groups in the city. Our image was that crowdfunding, targeting a constituency, and with one euro generating three, with its visible effect … It’s another type of project, which is complementary. Not every project needs to be of excessive quality, but it must be an addition to the totality of activities that we already organize. (#3)

Indeed, a respondent emphasizes that match-funding is not ‘a structural source of income’ for artists or other applicants and perceives ‘the area of structural funding’ to be the primary responsibility of the municipality. Match-funding does not provide a legitimate alternative to other funding sources (#5). This makes match-funding for local authorities a complement rather than a substitute for ‘traditional’ subsidies. Specifically, match-funding is considered a funding opportunity with a low threshold, very accessible, and less demanding in terms of application efforts compared with other funding. A policy officer (#3) states that ‘for some, the projects are the real “debuts”, and it is super interesting to help them forward.’ As has been explained: ‘More regular arts funding projects require a rather heavy trajectory. This [match-funding] is more like seed funding for smaller projects, for creators that would otherwise not find the funding or for projects that to a lesser extent suit the existing usual settlements’ (#4). Several respondents connect the different funding opportunities to various types of applicants:

One of the reasons why crowdfunding is a very important part of the impulse money program is because it is the most accessible subsidy variant of the program. And, all financing forms that are part of the program, are fit for a stage in the professional practice of a maker. (#1)

If someone is looking for incidental money, crowdfunding would be suited. If someone … , if an organization already has an established position in the field and has been successful for years, and would want to take the next step, then it could apply for the subsidy. (#1)

The argument that match-funding can fund applicants that normally fall by the wayside, was brought up repeatedly by respondents. Hence, they argue that match-funding permits to support individuals and not only organizations and that it attracts a much younger group of applicants – a group too that is usually less inclined to engage in other forms of funding and is less embedded in the local cultural field. The projects usually are relatively short and do not require major investments. Important here is that the campaigns are geared toward projects, and not so much towards more ‘structural’ investments such as rent, salaries, and non-tangible investments. Currently, in the Dutch examples, match-funding only involves non-refundable grants, while the crowdfunding palimpsest would permit other financing instruments, including loans and investments (Röthler and Wenzlaff 2011).

During the interviews, it struck that there was limited interest in the eventual outcomes of campaigns. Only a few public funders request an evaluation or a report. Respondents argue that they do little to monitor whether and how project owners follow up on their successful campaigns. This is surprising because respondents explained that the safeguarding of the match-funding budgets may require lobbying efforts. Yet, there are exceptions. One of the funders that consider their contributions to be subsidies explains: ‘it is important to execute the project and inform us; minimum 13 weeks after it takes place, for example after the book was printed or the show performed, someone needs to report to us’ (#1). Subsidies need to be justified, and how public money is being spent should be by subsidy regulations. Another exception is individuals who stay informed out of personal interest or ambition, ‘because the conversation is key … Supporting, thinking along and sometimes just being there is important’ (#2). Nevertheless, for most match-funding partners, the responsibility for follow-up is ascribed to the platform.

Barriers to match-funding implementation

As emphasized, match-funding partners consider match-funding to be an efficient and reasonably transparent way to allocate funding to local makers, specifically to a group that is underserved in traditional schemes. It has the potential of broadening up the pool of makers and as such making the cultural field more inclusive, because ‘everyone can receive financial support … there is attention for new disciplines and new target audiences’ (#3). Especially more traditional funds find themselves in ‘a loop of the same applicants over and over’ (#9) and engage in match-funding because of the platform’s appeal to a younger generation. Through match-funding, it is argued, greater levels of accountability can be achieved, and bureaucratic procedures circumvented. Put differently, by outsourcing the decisions of who deserves to be supported in local or regional contexts to donors, social support and stronger connectivity with citizens are being created. All this can be organized in a rather lean manner. However, despite the enthusiasm of public officials, it remains uncertain if and to what extent match-funding becomes a sustainable funding tool for makers and the cultural sector. There are several reasons for this uncertainty.

First, the democratizing potential of match-funding barely seems recognized by matching partners. Like crowdfunding, match-funding possesses a local community-building capacity. Motives of this nature were only sporadically mentioned by respondents. Career-building motives dominate the discourse. For example, a respondent expresses the expectation that makers connect and learn how to connect: ‘It is a plus when makers do not consider crowdfunding only to quickly “hamster” money, but also to reach an audience and learn more about marketing, audiences, and campaigning’ (#1). Some funders require that project owners give proof of projects being liked and supported. In that way, indirectly, community involvement may be stimulated:

We intended to only spend the money that was earmarked for crowdfunding, if and only if a substantial part of the budget comes from an audience. Not to stack funds onto funds, which, in practice, could occur; the public interest matters to us. (#2)

Secondly, the leveraging capacity of match-funding is not obvious to all the respondents. When matchers ‘top up’ a remaining part of a budget, they expect that the project already has a fairly large supporters’ base (Table 2):

We have deliberately chosen to match and contribute the final 30% of a project because we do not have other explicit criteria. We deem it important that they (project founders) show they are being backed by a large crowd. (#7)

Not all respondents are cognizant of the fact that a public contribution can unleash private money with an ‘in-first’ contribution. The capacity of match-funding to leverage additional funding for local and regional artistic and cultural projects is not actively pursued.

A third factor that may prevent further match-funding, lies in the perceived limitations of match-funding for arts and culture. Whereas local policy officials are concerned with encouraging entrepreneurship and advancing the self-sufficiency of local makers, they do not find match-funding to be an adequate solution. Respondents highlight two main concerns: first, in line with Dalla Chiesa and Dekker (2021), there appears little appetite among successful crowdfunders to engage in a second campaign. Project owners fear that they would over ask their friends and family, who commonly are major contributors. This indicates that the financial support networks and entrepreneurial activity of crowdfunders have limited opportunities to grow after initial campaigns unless crowdfunders’ assumptions prove wrong, and they become aware of that. Public officials know these views. Second, crowdfunding itself may be challenging in many sub-sectors of cultural and creative industries. The voordekunst director observed that music tends to be easier to crowdfund compared with e.g. theatre, dance, and publishing. In nearly all sectors, as several policy officials and voordekunst argue, the focus is much more on retrieving subsidies than developing long-term financial perspectives or acting entrepreneurially by setting up campaigns. Nevertheless, this is not recognized by all respondents: small firms and freelancers, and younger makers who would ‘never apply for a grant in a regular scheme’, are inclined to pursue a crowdfunding campaign (#9). Match-funding could allow for a more diverse range of beneficiaries and a more even distribution of budgets among sectors. Currently, larger and more traditional cultural and arts organizations find a haven in subsidies, and small-scale creative makers find a one-off opportunity in crowdfunding with possibly match-funding. It may take time until match-funding’s potential as a ‘collaborative funding mechanism’ (Senabre and Morell 2018) is fully exploited, but as long as traditional schemes continue to exist in their current modalities, it is not very likely that the entrepreneurial and social capacities of match-funding will be tapped into.

A future for match-funding in local and regional cultural policy?

Despite its growing prevalence and extending number of applications, match-funding continues to be a relatively niche form of cultural funding. Several respondents consider crowdfunding to be a quick method to raise money while equally raising an audience’s commitment, and therefore expect match-funding to become more important in (and after) times of crisis. Nevertheless, the permeability of the current subsidy system by new modes of funding seems low.

First, as stated by some respondents, municipalities feel a strong need to consolidate the structural cultural field (organizations that receive fixed subsidies over some years), which means that there is generally limited zest for projects and more innovative approaches to arts funding. Additionally, the 4-year cycle of cultural policy makes it ‘difficult to adjust small things’ along the way (#5). To implement changes, policymakers are required to wait until the next term. Lastly, respondents assume that traditional subsidy schemes remain the primary focus of most makers. As put by a respondent (#2): ‘I think the way our culture sector works can be somewhat conservative. People are quite cautious. Some exceptions do take on opportunities. But overall…’ These habits make it difficult for new practices such as match-funding to be implemented structurally in local and regional cultural policy.

Although many respondents rest on the assumption that crowdfunding stimulates cultural entrepreneurship and expands the pool of money spent on the arts by stimulating private giving, they realize that the overall political conditions can be volatile. Often being arms-length organizations, match-funding partners in the Netherlands are connected to but have relative autonomy from the local council, municipality, or province, in terms of funding decisions. In other words, they are given the freedom to decide which projects to fund, regardless of local and regional political preferences. However, they do depend on the existing systems, policies, and budgets set by the political authorities. When political authorities decide to cut back on the funding of arts and culture, match-funding endeavors are threatened first. Indeed, the interviews foreground a continuing fear of budget cuts, leading to a potential phasing out of early match-funding endeavors.

The lingering COVID-19 pandemic revealed a somewhat ambiguous position of match-funding within funding schemes. As most of the interviews took place during the onset of the pandemic, respondents voice an urgent need for short-term solutions, with many funds developing ‘impulse measures’ as ‘quick fixes’ for the suffering cultural economy. Match-funding could be a tool that permits flexible funding allocation by (semi-) public funders as well as private givers, ideal in times of crisis. Criticizing the antiquity of the arts funding system and its lack of creativity and dynamism, one respondent vividly emphasizes: ‘never waste a good crisis; this is the moment to innovate, to experiment and perhaps to revise the structure and sector as a whole’ (#2). Nevertheless, while several policy officials argue that this situation forces everyone to rethink the earning models of creative and cultural sectors and match-funding could become embraced, match-funding did not come to the rescue. A respondent points out that, while in place, match-funding was not considered a solution by artists. He argues that artists tend to take the role of a victim, become frustrated when they cannot apply for COVID-19 support measures, and would like to see the government and society recognize the cultural, social, and economic value of their work. When asked to put a price on their work, artists struggle and ‘do not think at all about earning money’ (#2).

Taken together, the current conservative attitude toward funding is caused by two parallel trends. First, according to some respondents, artists and creatives are too passive, whereas they should rethink their business models and their value and should stop offering their products and services for free. Only then, match-funding systems can deliver on their promise. Second, the way local public policies are organized – around four years periods of office – makes it difficult if not impossible to adjust existing schemes to new developments. While some respondents underwrite entities (e.g. political, cultural) think too much about short-term solutions instead of accepting the need for a long-term change, it appears difficult to implement and consolidate a new system that allows for quick financial interventions.

Discussion

After digital production and digital distribution methods have permeated the arts and culture, a digital financing turn can be expected, with crowdfunding as a flag-bearer (Loots et al. 2022; Peukert 2019). Scholars have deliberated on the broader socio-political and socio-economic contexts and implications of crowdfunding, of which match-funding could be a powerful extension because of the involvement of public authorities (De Voldere and Zeqo 2017; ECN 2018; Mollick 2014; Rykkja et al. 2020; Senabre and Morell 2018). Yet, the translation of this into manageable practice remains imperfect. The present study affirms that crowdfunding continues to be seen as a source of financing, an example of ‘how social capital can be transferred into real cash’ (Röthler and Wenzlaff 2011, 5), and less as a technology or a new paradigm that involves ‘an almost philosophical approach applying the Web 2.0 paradigms of transparency and participation’ (Röthler and Wenzlaff 2011, 10). It also demonstrates that the match-funding aspect does not turn crowdfunding evidently into a mechanism with financial, cultural, or democratic impact.

We foreground three reasons why match-funding is not reaping its full potential as a new technology that could serve extra financing of the arts as well as co-decision-making, co-creation, and cultural democracy in local and regional contexts: its newness, its framing as a subsidy, and perhaps the fact that it is being developed in a ‘cultural policy’ context. First, the implementation and application of match-funding in the Netherlands are characterized by abundant variation. The application procedures for project organizers vary greatly, ranging from ‘traditional’ relatively lengthy subsidy applications to a brief ‘click on the button’ without quality checks. The narratives, budgets, and involvement of administrators in decisions also vary in range and scope. Whereas the limited convergence in match-funding application methods is understood because of its novelty, it is a procedural barrier to its notoriety and implementation.

Second, conceiving match-funding only as a subsidy limits its full potential as a mechanism at the intersection of funding, policy, and technology. As mentioned, the moment of the match may affect outcomes (Baeck and Mitchell 2016): contributions up front by the authorities serve as a quality signal that convinces other donors to contribute. Such leveraging of private giving does not necessarily supplant public giving but rather increases the earning capacity in arts and culture. Yet, this was not expressed as an explicit goal of match-funding by the interviewees of whom none crowdfund ‘in first’. Otherwise, matching by authorities and funds can ‘top up’ onto projects that have reached certain thresholds, leading to the realization of more or more specific projects. Topping up may support cultural democracy by recognizing public choice and may add to the transparency of funding allocation. Only two of the authorities ‘top up’, and one respondent clearly explains the consequences. Limited comprehension of the mechanism of match-funding and its empowering potential may be an obstacle to its further implementation, as was previously exposed (ECN 2018).

Third and related, it can be questioned whether the traditions of a cultural policy stand in the way of match-funding’s implementation. If public authorities have a limited scope of match-funding, associating it mostly with subsidies, reward-based models, and individuals or small community projects as its beneficiaries, and without any clear proof of match-funding’s effectiveness, the modest match-funding budgets of local authorities and funds are the first to be eliminated. And with that also the experimentation with technology-based co-financing principles (cf. Rykkja and Bonet 2020). Equally, it can be tempered as long as authorities associate the idea of ‘democracy’ with the participation side mainly, and not much with funding or entrepreneurship (Le Pendeven, Morel, and Leboeuf n.d.). Recognizing match-funding as a ‘collaborative funding mechanism’ (Senabre and Morell 2018, 5) in the field of arts and culture rather than a small grant complementary to other arts subsidies, could be a crucial first step to avoiding its rise (and fall) as a mere fad. Even more, to extend its life span, match-funding may need to become accustomed to domains where charity and public-private investments have proven their mutuality before it is embraced in a domain as ‘marginal’ as arts and culture. While with match-funding ‘more money seekers can start a venture and more people can support projects or even become investors with a small amount of money and with little risk’ (Röthler and Wenzlaff 2011, 5), the domains in which match-funding occurs are typically not the most profitable ones – sociocultural and educational innovations, health, smart city projects, arts and cultural heritage (Senabre and Morell 2018). Scope remains for the experimentation with joint funding and participatory decision-making through the match-funding mechanism, for example in the social and local welfare domains, or the urban infrastructure.

Conclusion

The leading question of the present article is: what are the motives and perceived opportunities and challenges of integrating match-funding in (local and regional) cultural policy? Match-funding through crowdfunding platforms has the potential to leverage public and private funding and transparently distribute budgets (De Voldere and Zeqo 2017; ECN 2018) but is unpopular until today (Rykkja and Bonet 2020). Match-funding may contribute to the democratization of entrepreneurship and funding: It allows entrepreneurs with creative project ideas to circumvent the traditional providers of capital and develop a project with which they can convince various financiers about punctual or consecutive funding. In the arts, it allows newcomers to enter some cultural markets (such as music, fashion, and visual arts) bypassing powerful gatekeepers (De Voldere and Zeqo 2017; Galuszka and Brzozowska 2017). Similarly, match-funding has some potential to contribute to cultural democracy by letting communities co-decide on the beneficiaries of public spending (Gripsrud 2000). In cultural policy, match-funding may be a tool to facilitate and mobilize cultural activities at a local level.

This interview-based study highlights that local authorities and funds that apply match-funding make the connection to cultural policy and political choices, emphasizing mainly cultural entrepreneurship and, secondarily, community. Regarding cultural entrepreneurship, the validation of match-funding is somewhat ambivalent, because it is conceived by most local policymakers as one early step on the subsidy ladder. Seed money could be supportive in opening up a market or financing opportunities for niche and young makers who find themselves in vulnerable positions after the retrenchment of the welfare state and growth in freelance, less protected work (Brook, O’Brien, and Taylor 2020; Ross 2009). In its current presence, match-funding is not so much a leverage for an arts and culture start-up ecosystem, but rather a manifestation of arts subsidization. Additionally, the community and civic angles of match-funding are in the case we studied less outspoken, apart from fewer respondents articulating that match-funding should be able to address all citizens and that project owners need to give proof of being backed before receiving a contribution. Though crowdfunding projects often have a strong local connection, and match-funding partners explicitly tap into this, the rationale to do so is rarely ambitious in strengthening local communities of cultural production and consumption. This can be a missed opportunity.

The study concludes that match-funding is currently too novel, too much entrenched in the cultural subsidy vocabulary, and maybe developing in the wrong policy domain to thrive as a ‘collaborative funding mechanism’ (Senabre and Morell 2018, 5) situated on the cutting edge of the democratization of finance (Röthler and Wenzlaff 2011) and cultural democracy (Bonet and Négrier 2018; Galuszka and Brzozowska 2017; Gripsrud 2000). Relevant areas for future research remain the questions of the crowding-in potential of match-funding (is it because of the public contributions that projects become backed and take place?), its democratization potential (if match-funding will become more embraced by policymakers, creators, and backers, will it bring about a more efficient and equitable allocation of resources to the arts and culture sectors?), and of how regulatory frameworks and public policy specific to crowdfunding and match-funding will develop and converge between national systems (Lazzaro and Noonan 2021).

Acknowledgments

The authors gratefully acknowledge the feedback received from the participants of the 4th European Alternative Finance Research Conference 2020.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

The work was supported by the Instituut Gak in the Netherlands [grant number 2019-041].

Notes on contributors

Ellen Loots

Ellen Loots is an assistant professor of Cultural Economics at the Arts and Culture Studies department of the Erasmus University Rotterdam. Her main research interests include entrepreneurship, business models, and forms of finance and funding in the cultural and creative industries. Between 2020 and 2022 she coordinated a project on the income and earning capacity of creative professionals in the Netherlands, funded by Instituut Gak.

Kaja Piecyk

Kaja Piecyk has obtained a Bachelor’s degree in the international program of Arts and Culture Studies at Erasmus University Rotterdam, the Netherlands. She has a particular interest in policy, public administration, and urban planning issues. Kaja was a research assistant in a project on the income and earning capacity of creative professionals in the Netherlands.

Yosha Wijngaarden

Yosha Wijngaarden is an assistant professor of Media and Creative Industries at the Media and Communication department of Erasmus University Rotterdam, the Netherlands. Her main research interests include the practices of creative work, cultural hubs and clusters, and the nature of innovation in the creative industries. As a postdoctoral researcher, she took part in a project on the income and earning capacity of creative professionals in the Netherlands.

Notes

1. https://www.Voordekunst.nl (translated as ‘FortheArts’).

Appendix

Interview outline

1. Can you introduce yourself?

2. Why did your organization choose to partner with voordekunst?

3. How is this partnership organized?

a. What ’rules’ and conditions apply?

i. What is the amount contributed to projects and when is this amount added?

b. How are the tasks divided between your organization and voordekunst?

c. What is the political influence?

d. What happens after the campaign? To what extent are participants monitored?

4. How would you characterize projects funded through match-funding?

a. Based on what criteria are the projects selected?

5. How does this method of funding compare to other forms of subsidies within your organization?

a. Is this a new scheme or has this scheme replaced another type of funding?

6. What opportunities does this collaboration present?

a. And what difficulties do you experience?

7. What could be possible barriers for other organizations not to enter this partnership?

8. What expectations do you have regarding match-funding in the future?

a. And specifically, during or after corona?