How to Fundraise with NFTs
A quick guide for nonprofits to fundraise via NFTs
NFT stands for Non Fungible Token and is a new application of crypto that’s being used by creators to sell their digital goods. NFTs have exploded in popularity since the start of 2021. It has unlocked a new way for digital artists and creators to monetize their work. If you need to understand NFTs in detail and its impact on social good, then read my previous article on the topic.
NFTs present an immense opportunity for nonprofits to raise funds and is a totally new way to fundraise. So far nonprofits have only been passive recipients of NFT sales and have not actively pursued this strategy. Someone famous auctions their digital art and gives all or part of the proceeds from the auction to charities.
If nonprofits would like to leverage this new wave of NFT fundraising they need to be more actively involved. Two ways nonprofits can get started:
First Option
Collaborate with a digital artist. If you don’t know any, find them on NFT platforms such as Foundation, OpenSea, Superare Nifty Gateway. Artists have to submit their profiles to get listed on NFT marketplaces or they need an invite. The NFT platforms are the best place to find an artist to collaborate with as they are already listed, have experience in selling NFTs and understand the mechanics well.
Research the artists on these platforms, see their work, see if any of their artwork aligns with your cause. After carefully researching, pick a few and approach them.
Explore with them the idea of doing a collaborative auction. Show them the value you bring to the table > your massive social media followings > elevating the artist profile, new networks and reach > attaching the art auction to a cause would boost the auction > the good it would generate.
Once you have an artist onboard, discuss and agree on the terms, full or part of the proceeds. Donation in crypto or credit card.
The artist would then mint and list the NFT. You provide value by promoting the work to your network and super donors. Remember there are fees that artists need to pay in order to mint, list and close the sale.
Second Option
Sell your own original digital item as an NFT like how Noora Health did.
Most nonprofits have troves of digital treasures. Photos of your projects and impact, a tweet that announced something significant, digital art that you may have created for awareness or fundraising. Put out something that’s high quality and profound. Something that speaks of the great work you are doing or the great problem you are tackling. NFT collectors may want to own and showcase the art as someone making a difference.
Choose an NFT Platform. Once you have settled on the digital piece you’d like to mint as an NFT, choose a platform to sell it on. There are many, OpenSea, Nifty Gateway, Foundation, Variable (for tweets only), Portion. Here is a list of NFT platforms and their offerings
Setup your Digital Wallet You need to have a digital wallet with ETH in it, the native currency of Ethereum blockchain. Since most NFTs are currently minted on Ethereum blockchain you need ETH to pay for gas, listing and other transactions. Gas is the fee you need to pay every time one interacts with the Ethereum blockchain. The gas fee fluctuates throughout the day. The best time to mint an NFT (create a unique token for your digital piece) would be when the gas fee is low. Here is a live tracker you can use to figure out the best time to mint.
Mint and list your NFT. Once you have your wallet and profile setup on the platform you can go ahead and mint your NFT. You’ll have to pay the gas and minting fee and wait for the NFT to be minted. Once minted you can price it and list it for sale or auction. Also note most platforms take a commission on the sale. There are few like Portion that don’t charge a commission. It’s important you do your homework around platforms and see which one is best suited for you since every platform has something different to offer.
Promote. After you’ve listed your NFT you need to promote and mobilize support. Reach out to the platform you are listed on and ask them to promote your work via their social media. Spread the word on social media, Twitter and discord channels are great to get into the know of crypto folks.
You can start off with the first option gain some experience and then dive into creating your own. The NFT space is really young, artists are looking to boost their online profiles and so are the platforms. Nonprofit collaborations would be a win-win for all.