Crowdtilt unveils Crowdhoster to 'infect the world' with crowdfunding

Crowdtilt CEO James Beshara has a radical vision for crowdfunding, and its a lot bigger than Kickstarter. Today the Y Combinator startup publicly debuted its open source crowdfunding tool called Crowdhoster that lets any person or organization integrate crowdfunding into their site, without using any code.

“There is this voice in my head saying that crowdfunding is so far from what it could be in 2013,” Beshara said in an interview at Crowdtilt’s SoMA offices. “We believe strongly that crowdfunding has the power to turn payments into a form of communication. Communication shouldn’t be restricted, it should be open, accessible and given to everybody. Its about radical inclusivity.”

Beshara described Crowdhoster as “WordPress for crowdfunding.” People trying to raise money can easily set up campaigns and host them on their own site. They can customize and brand campaigns, communicate with their audience, and own all the data about their funders. Well-known crowdfunding sites like Kickstarter and Indiegogo have a specific set of guidelines about what sorts of projects can be posted, and once a campaign is closed, they are no longer platforms for sales. Crowdhoster has tools for managing orders, keeping track of customers, and billing so the campaigns are not as fleeting. Giving campaign owners complete control of their campaign is a big step in the crowdfunding ecosystem, Beshara said, whether you are talking about raising money for an independent documentary or generating pre-orders for a tech gadget. He envisions a day when crowdfunding is a weekly, or even daily, part of people’s lives.

“Crowdfunding is too powerful and makes too much sense for it only to invest in silos,” he said. “With Crowdhoster, we want to infect the world with crowdfunding. This is just version 1. Who knows where it will all go? Kickstarter is not the future of crowdfunding, and we are building the product we think should exist.”

Crowdtilt graduated from elite accelerator program Y Combinator in 2012. It was founded as a place where friends could pool their money together online for a specific purpose. It focused on enabling group experiences or shared causes, like rallying hundreds of friends to throw a lavish yacht party or raising nearly $100,000 to preserve a struggling school. This model was doing well, but Beshara had a bigger vision for what the engineer-heavy company could do.

Crowdtilt released an API in December 2012 for developer use, but people without programming expertise expressed interest as well. Crowdfunding has emerged as a major global phenomenon over the past few years, generating 1 million successful campaigns and $2.7 billion across the globe in 2012. The industry has become more narrow as crowdfunding platforms crop up in specific verticals. There is Kickstarter and Indiegogo for creative projects; Rally.org, GoFundMe, Benevolent, HopeMob, and Razoo (among others) that support crowdfunding-for-social good; Neighbor.ly, which crowdfunds civic projects; Healthfundr for health startups; CircleUp for consumer goods, and the list goes on. Beshara said that the real possibilities of crowdfunding were being curbed by all these niche sites. The real potential, he said, lays in opening up these campaigns to anyone with an Internet connection, a cause, and a community.

The first Crowdhoster campaign was for nutritional replacement Soylent, which raised over $1 million. The Soylent founders already had a significant Internet following and did not want to put the fate of their company onto a third-party platform. Campaigns launching today include AdBlock, which is raising money to fund “anti-advertisements”, efforts to bring back Summersault music festival, and 3D eyewear company Protos looking for money bring its product to market. 

“The Internet has made us all insanely connected, and good ideas thrive,” Beshara said. “The plumbing exists for great ideas to go viral. You bring the community to your campaign.”

The application list and queue to use Crowdhoster is already over 1,000 and includes a number of big global brands interested in using the technology as a way to test drive new product ideas with consumers. Crowdtilt is also in discussions with the San Francisco Parks and Recreation Department about new tax structures that let citizens dictate what projects their taxes fund. These are the sorts of ideas that Beshara, who has a degree in development economics, sees as possible.

Crowdtilt raised $12 million in its first round of financing earlier this year. It has about 20 employees and is based in San Francisco.