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We’ve all read at least one story about a budding entrepreneur who fully funded his or her Indigogo dream project or a band that was able to go on tour through their success on Kickstarter. But for every success there are dozens of others whom we never hear about.
This leaves us wondering: what separates successful campaigns from those who get lost at the bottom of the scroll menu?
While there are several factors that contribute to a funding failure (such as lack of demand for the product, not enough transparency, and overall lack of communication with the audience), crowdfunding offers a great platform to raise capital and awareness for your next project. After all, not all entrepreneurs have access to an angel investor or a venture capitalist due to their location or inexperience.
Here are 5 ways to ensure the odds are in your favor when launching your first crowdfunding campaign.
1. Have a finished product or project: The role of raising capital is to make more of a great thing, not just iterate on a mediocre idea. People generally want a product that makes their lives easier or a project that has a compelling mission. Having a tangible product allows for transparency on how it benefits the end users, cost breakdowns and future plans on how the funds raised will be used.
2. Pick a platform: It’s important to do your research on what receives the most funding on a particular crowdfunding site. Creative projects receive the most funding from Kickstarter, academic research projects do wonderfully on Fundageek, whereas general projects do better on Indiegogo. Participating in a field that you can specialize in will increase the likelihood of crowdfunding success.
3. Be honest with where the funding goes: Your friends love it, mom and dad love it, and demands are coming in faster than you can fulfill orders, great! So assuming that you’ve built a product you wholeheartedly believe can change the world, being clear on how the new funds will be allocated gives the investor a better idea of how the product is being made, where it is manufactured, and how soon they will be able to get their hands on one.
4. Find outlets to share your crowdfunding page: It makes the most sense to ask immediate family and friends to post and share your mission on their Facebook and email everyone in your contact list. Even friends of friends also spread the word on your behalf. However, there is a finite reach to this approach and you’ll eventually hit a ceiling. An excellent strategy to implement is to find matching industry blogs that have large numbers of readers. Find the editor’s email address on the contact page and send them samples of your product in exchange for a blog post or review. Contact as many bloggers as you can and watch the magic of compounding numbers at work.
5. Be compelling!: People are more likely to listen to those who speak their message with passion. WE aren’t saying make a 20 minute speech, as that can bore your audience faster than they can click the back button on their browser. (In fact according to Visible Measures, after a full minute of watching an online video , 44.1% of viewers will have clicked away.) Breaking down your message into a mix of text, illustrations and a short video is a much better strategy to hold the audience’s ever-shifting attention.
Crowdfunding is one of the best platforms on the internet to raise awareness and fund a project. Keep in mind that there is a limited window of time for each opportunity so it is critical to have a carefully planned approach. Think of it like this: great chefs prep everything in advance (sometimes days before), so they only have to put the finishing touches on when it’s time to eat. Similar to those chefs, make sure you have all your plans written out and blogging contacts ready to contact to give yourself the best shot at being fully and successfully crowdfunded.
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