The recent Jumpstart Our Business Act, which U.S. President Barack Obama signed into law in March, allows crowdfunding to be used to sell shares to the public. While there are strict limits to how much “unsophisticated investors” will be allowed to commit to a single company, companies will be able to sell shares to individual investors without having to go through a public offering. Since laboratories in academic research settings such as hospitals and universities represent private companies, why not apply a crowdfunding model to academic science?
I have long ventured that the public’s apathy to most of the research taking place on their behalf results not from a lack of interest, but a failure of scientists to properly communicate their goals and findings; and a recent string of successful applications of this model to basic research projects appear to support my view that crowdfunding science works (see here and here).
While federal institutes such as the National Institutes of Health in the United States and the Canadian Institutes of Health Research in Canada already provide baseline financial support for academic research programs through a multitude of publicly funded grants, the mechanism through which finding decisions are made – 12-page research proposals, career development addendums, consortium-contractual arrangement documentation, peer-review committees, etc. – do more to disconnect the lay public from the investment decisions being made on their behalf than engage them in the world-changing scientific advances they are actively helping support.
Moreover, while academic research programs are meant to tackle the unknown for the sake of making significant strides in our understanding of the natural world, present economic circumstances have forced federal funding agencies to shy away from high-risk/high-gain ventures in light of “safer” investments that mostly fill in the gaps between major research discoveries and are best left to private companies which are inevitably more risk-averse.
To strengthen the relationships between science and society, I propose the creation of a national crowdfunding website by the major federal research institutes where academic researchers can post their more risky research proposals. Briefly, principal investigators or academic departments apply to a partner at the NIH, CIHR or equivalent to request a grant for a high-risk/high-gain research program not already being actively supported by a federal or private grant:
- Inclusion in the program would be based on the applicant’s background and appointment, institutional support, and track record, protecting potential investors from postings from researchers without the necessary infrastructure or experience to follow through on their research proposals.
- Research proposals will be outlined as follows, with each section limited in length and scope. Descriptions of the principal investigator and the research environment will be available for every proposal:
- Gaps in our Understanding
- Research Strategy/Approach
- Potential Problems and Solutions
- Relevance to public health
While proposals will be structured very much like current grant applications, their success will be based mostly on their ability to attract investors, translate the research question into commonly-understood parables, and contextualize its importance in a manner that is understood by the lay public.
- Research proposals will be reviewed by an editorial team of general scientific professionals to ensure profiles are clear, that ‘Significance’ and ‘Background’ are not grossly misrepresented, ‘Hypotheses’ are appropriate and ‘Research Strategies/Approaches’ are not intrinsically flawed. The purpose of this review is not to be academically rigorous, but to ensure proposals adhere to principles of scientific integrity so that investors are able to make fair and informed decisions. Issues relating to missing, incorrect, or inconsistent information will be flagged and investigators will be permitted to revise their applications before publication (think Wikipedia revision control).
- Project funding goals and deadlines will be set by the principal investigator in collaboration with the crowdfunding resource. During the lifetime of a research proposal people are free to fund the project, and it will be the responsibility of the principal investigator to advertise their research program. The crowdfunding resource will retain the right to promote certain research proposals that the institute feels is a particularly paradigm-shifting project with a high likelihood of success. Likewise, academic scientists will be encouraged to register to the site and permitted to rate the application. This will provide the lay public with a litmus test of how professionals feel about the current application.
- If the project succeeds in reaching its funding goal, all donations will be processed; if the project falls short of its funding goal, no one will be charged. This all-or-nothing funding protects investors from supporting projects that, due to fundraising constraints, cannot be realized. The crowfunding site Kickstarter has proven this system works; with projects either making their goal or finding little support. Statistics from kickstarter have shown that 82% of projects that reach 20% of their funding goal, and 98% of projects that reach 60% of their funding goal are successfully funded.
- Individuals funding research programs through this crowdfunding resource will be included in the acknowledgements section and receive a copy of the published manuscript. Publication fees should be included in the budget.
- Individuals funding research programs will be included as shareholders for profitable patents resulting from the research they helped support. Shares will be proportional to investment, and profits resulting from the patented research will be returned to the crowdfunding site (minus an administrative overhead for the crowdfunding program) for reinvestment in other research proposals at the discretion of the investor.