The Lag Problem

I’ve been thinking some more about the conversation surrounding Spot.us, the crowdfunded journalism project that Digidave is working on.

I still have some reservations about the viability of a site like this, but at least I’ve narrowed it down to a core problem:


  • Lag: the time from when a proposal goes up, to the time it reaches a critical mass of funding.


    • Lag is the reason, I’d argue, why crowdfunding may work in some situations like personal microloans, but not in others, like journalism. But I did a search on crowdfunding stats, and I came upon an astonishing claim - according to one site, the average time for a Kiva loan to be funded is 45.93 hours! (I couldn’t find another source to back it up). So maybe it’s in my head, but I still suspect that the vast majority of crowdfunding sites don’t have such quick turnaround. It takes weeks, if not months, to get funding for a loan.

    But David is well aware of this. He rightly suspects that quick time cycles and low barriers make the system easy to game. (Gaming is right up there with Lag as a formidable challenge) In fact, that’s why - as he says in the Future Tense interview - that there will be limits to how much one individual can donate to a single story. That means that in the best case scenario, I’d assume that the absolute lower limit for getting a story funded would be 50 hours * limit, where limit == the imposed limit on individual donors. I’d go ahead and divide that number by the percentage of traffic the site is getting compared to Kiva. If it gets a tenth of Kiva’s traffic, for instance, I’d divide the lower limit by .10, or multiply it by 10.

    Maybe I’m being too hard, here. There are tons of under-reported stories that aren’t very time-sensitive, especially in the local space. But time-sensitive stories are the bread and butter of news. After all, there’s a good reason they don’t call it “the olds”.

    One possible solution would be that visitors could contibute to topic-based funds, somewhat similar to the model at the American News Project. Editors would then be able to use their discretion to allocate funds, allowing for time-sensitive stories to be more viable.

    Thought for food, at least.

    This was posted 3 years ago. Notes.