If you have a business idea that you feel is too great to keep in the dark with not enough money to back it up, the solution to your problem may be found through crowdfunding.
It is one way to give your new business idea the shove it needs to finally make your dreams come true. Crowdfunding has been a valuable way in the past for some entrepreneurs to introduce their business and companies without putting up a lot of investment capital. Through crowdfunding, some companies have introduced their products and tested their performance on the market first without producing a lot of stocks firsthand.
However simple it sounds, though, starting a crowdfunding campaign can be a little complex. Firstly, since you will be asking strangers to back up your business idea your campaign must be credible enough, and it is not always easy to trust strangers, especially with your money. Some of the crowdfunding platforms around are Kickstarter, GoFundMe, and Indiegogo (and many others), and gone are the times when crowdfunding was a new ‘thing’ that new business ideas experience overnight success though it. To be able to run a successful crowdfunding campaign, it is essential for you to follow a few steps and take the advice of people who are experts in the field.
BE HONEST AND SHARE YOUR STORY
In order for your project to appear credible and legitimate you have to be honest in your campaign and share a background of your business idea. You need to make your prospective funders know a lot about your project – product details if you are launching a product or publishing a book. You should also tell them how the will benefit from funding your business venture and what your plans are after you have received the appropriate funding.
It is also important that you represent your project with planned images and videos, and one of the best ways to show your passion for your project is through a video. You need to make an honest but creative video pitch for your project, speak clearly while explaining your business idea or your product, and make sure you look presentable when doing so. When you speak with all honesty and truthfulness you are more likely to engage the people who will watch your video pitch.
Tip: Keep your business idea and your pitch simple. Stick to one idea first and one product, funders will not find credibility on someone who have so many ideas and products in mind. Also, make sure that you ask a reasonable amount of money for funding.
PRESENT GREAT REWARDS
One of the things that you can use to attract funders is by offering great rewards to them. Of course the main reason they will click that donate button is because they feel your idea or product has great potential. When you are planning the rewards of offers you will give your pledgers make sure to be realistic with them and that you can actually fulfill them when the time comes.
Tip: Josh Lindsay, who been part of three crowdfunding campaigns suggest that you offer your product that you want to market to your pledgers, and not some other things like bags or t-shirts.
SET A GOAL AMOUNT FOR YOUR FUNDING
Before you start your campaign you need to set an amount goal for the funding you need. Once again, be realistic and ask for money just enough to launch your business or company, and do not ask for too much money. Also, you should know that if you start a campaign with Kickstarter and you are not able to reach the funding goal you have set, you will not be able to get to keep the money that accumulated. It is different with Indiegogo, you get to keep the funds you have raised whether or not you have your have reached your funding goal. Also, keep in mind that once you have started your campaign you cannot go back and change the goal amount you have already set at the beginning.
Tip: Another tip from Lindsay is to seed your campaign. Since funders will be imparting their money to a stranger, nobody will want to be the first one to click the donate button. Once potential backers see others have already donated they will not be hesitant on donating themselves.
MARKET YOUR CAMPAIGN
Spread the word, make people know about your crowdfunding campaign, use social media platforms, use your blog or contact other bloggers, host a live event – do everything you can to expose your campaign out there.
Tip: Some of tips from Lindsay are to say no to marketing companies who will approach you to help your crowdfunding campaign, you will only waste money in doing something you can do yourself. Also, make sure to plan carefully your launch day and be ready.