Here’s a quick step-by-step guide on how to crowdfund, from setting up a campaign and launching it, right through to wrapping it up successfully.
1. Choose a Crowdfunding Platform
There are a lot of them out there, but here are some of the best:
This platform is one of the biggest (and oldest) crowdfunding platforms out there. Since their founding in 2009, they have already helped more than 150,000 projects from tech startups to creative entrepreneurs. The downside of Kickstarter, though, is that you would need to complete your fund goal before a fixed deadline, otherwise, you won’t get anything. It’s all or nothing.
If you’re looking for an alternative to Kickstarter, then we recommend checking Indiegogo out. Their major difference is their “flexible funding” option. This means that you can still get any funding you receive regardless of whether your goal has been met, as long as it meets the minimum amount of $500.
Finally, for more personal and creative pursuits, you can try GoFundMe. It doesn’t have a fixed goal that you need to meet unlike the other two that has made it very popular for those who want to raise money for medical needs and charitable causes. This platform is not as big as the previous two we have mentioned, though, so the capital that you’ll be able to raise here might not be as substantial.
Here’s a question we frequently get: Is it possible to run the same campaign in two (or more) crowdfunding platforms?
Yes, it is possible. However, we advise against it. Running a single crowdfunding campaign is a work-demanding process already. It will require a lot of promotion and digital marketing efforts. Also, giving your funders options may split their efforts and donations in half which can result in both campaigns failing.
Set a Funding Goal
Once you’ve established a compelling argument on why people should pledge their support for you, it’s time to figure out the figures. How much do you actually need in order to launch your business? And more importantly, how confident are you that you can meet that goal within the set deadline? This is especially crucial if you have an all-or-nothing campaign.
Offer Different Giving Levels
Now that you have a goal in mind, it’s time to set the amounts that people can donate or pledge for. Remember, not everyone can donate a thousand dollars to starting a business owned by a complete stranger. In fact, what really builds engagement in a crowdfunding campaign over time is the number of lower-level backers you get.
Here’s a great way to motivate more people to give higher-levels of donation: give adequate rewards. If possible, give all your donors a reward. It can be as simple as a sticker or a pin of your brand logo for lower-level backers. Reserve the bigger perks such as a limited free trial of your product before it launches to the public to your high-level donors. Just make sure that you can actually fulfill these rewards.
Promote, Promote, Promote!
With your brand, story, goal, and giving levels all set, you can now launch your campaign and publish your crowdfunding page. All that’s left to do now is to promote it. Let’s face it, your biggest pledgers are probably those who are already part of your inner circle, but if you want to expand to other people, this makes it a perfect opportunity to get your name out there. Utilize social media marketing. Send out email campaigns. Reach out to bloggers and social media influencers. You can even organize a live event to drive up your campaign engagement! Need a few more ideas? Give us a call!
End Your Campaign With a Bang
We have no doubt that you will be able to meet your goal, but your campaign isn’t over yet. It’s only over after you have fulfilled your promised rewards to your backers. If you don’t, you’re also setting up your business to fail since it will shed a bad light on your image and reputation as a budding entrepreneur. Nobody wants to support a business that doesn’t deliver, after all.
Here’s a pro tip: Follow-up with your pledgers and see how they have received their reward. Did they enjoy your product? Did it exceed expectations? Use this to collect positive reviews online and get insightful feedback in order to further improve your business.
By following the tips that we have shared with you above, we’re sure that you will be a successful entrepreneur in no time, even without starting capital!
About the co-author: Lidia Staron contributes articles about the role of finance in the strategic-planning process at OpenLoans.
Lastly, keep promoting!
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