More than 95% of all companies fail in the first five years of their business development. The most common difficulty entrepreneurs face during this period is the lack of investment funds. Most new businesses are not able to produce a solid cash flow that can be reinvested into the business operation, while finding a rich angel investor can be very tricky.
During the last decade, the new type of investment concept has gained huge prominence, with a noble mission to help talented people collect funds for their projects and turn the world into a better place. Although the crowdfunding concept wasn’t created solely to help entrepreneurs, many business people have used this method for collecting large funds that later skyrocketed their enterprises into the world of big business. In this article, we will share some tips that will help you create an engaging crowdfunding campaign and collect funds for developing your business idea.
Create a business
Before you start a crowdfunding campaign, you need to do a lot of research and create a very detailed business plan. In this segment, collecting money from crowdfunding is not much different from finding a single rich angel investor. Each contributor wants to know how their funds will help you achieve your goal, so you need to create several estimates of the amounts you will collect and plan what you are going to do with each dollar you receive. Your goals need to be SMART, clear and easily achievable.
Research the crowdfunding process
One more thing you need to do before starting your campaign is learn a lot about the crowdfunding process. Try to find out the factors that motivate people to donate money to the entrepreneurship projects they like, and analyze the rules of the most popular crowdfunding communities. This will help you create a campaign that will perfectly target the members of a certain crowdfunding community.
Choose the platform
Every crowdfunding community has its own unique rules. In this step, you will need to choose the platform that allows you to unleash all your creativity and target the people who would be interested in funding your project. At the moment, Kickstarter is the biggest crowdfunding community. They allow you to reach millions of people from around the world, but getting the prominence for your idea on Kickstarter may be a little bit difficult due to the very fast traffic on the platform. Indiegogo, on the other hand, is a much smaller platform that focuses on inventive entrepreneurship projects.
Create a campaign
First, you need to develop your campaign story and write down all the important information. Since people would rather invest in non-profit projects than in commercial ventures, you will need to offer them something in return. If you are developing a product, make the first batch a gift for the most generous crowdfunding donors. You can also create other rewards, but make sure that their overall cost doesn’t exceed the amount of money you are planning to collect.
The best way to show off your creativity when creating a crowdfunding campaign is to add high-resolution photos and videos to it. Most successful campaigns usually contain short introductory videos that explain the most important benefits of their project. Many entrepreneurs invest a lot of money, time and effort into developing their story and equipping it with engaging visuals. If you need more information about creating a successful campaign, look for more elaborate crowdfunding guides online.
Promote your campaign
There are people who regularly follow projects on crowdfunding platforms, but the vast majority of members visit the website only when they see a likable campaign. Most people use social media to promote their campaigns. By investing money in social media ads, you will be able to reach a large number of people and motivate them to invest their money in your project.
Apart from the social media, you can also use online forums, Google AdWords, TV, online and regular radios and even guerilla marketing tactics, especially if your campaign has some significance for the local community.
If you motivate other people to share your campaign on their social media profiles, you will be able to collect much more money. Ask all of your friends, family members, colleagues and online and offline acquaintances to spread the word and keep their social media followers informed. Pay close attention to the influencers. These are the people who have many social media followers and therefore can influence people on the much higher level.
Launching your campaign
People often have huge expectations when they are launching crowdfunding campaigns. Collecting 25% of the projected funds in the first 24 hours after the launch can be considered as a great success. In time, your campaign will lose its hype, but you can keep it alive by constantly bringing new donators from the social media pages. While your campaign is on, keep your followers updated and informed about the amount of money that you need to collect.
After you collect the necessary amount, don’t forget to thank everybody who donated. Add them to a special mailing list and keep them informed about the development of your project and the ways you are using the collected funds.
About the Author
My name is Alex Williams, born and raised in beautiful Sydney. I am a journalism graduate, and a rookie blogger trying to find my luck. Blogs are the perfect opportunity for presenting yourself to wider audience, getting the chance to showcase my expertise and receiving recognition. I am a regular contributor at BizzmarkBlog.