How to Prep for Crowdfunding
You have a great business idea, and you’ve decided to try crowdfunding to raise the money you need to turn it into a reality. You want to start your fundraising efforts immediately, while you’re super gung-ho.
Not so fast — you’ll need at least three months, maybe up to six, to plan a successful campaign. If you go in underprepared, you may find yourself scrambling or working into the wee hours, only to fall short of your funding goal.
So, how should you prepare? Follow these steps:
1. Prime the pump. Your launch should not be the first time that people hear about your project, especially any wealthy or well-connected friends or colleagues who may help you. Remember: Crowdfunding is about raising money through your friends and their connections. Start spreading the word months in advance so you’ll receive a big funding burst at launch.
You want to come out of the gate strong with crowdfunding for two reasons: It makes people feel as if they’re backing a winner, and your crowdfunding website’s underlying algorithm will promote your project if it’s popular (think more clicks, more dollars, more backers).
2. Sell your story. You should have as many ways to sell your idea to your backers as you have backers. Look at every person as a new challenge: Is she numbers-oriented? Will he help you just because you’re old friends? Do they generally fund charities or the arts? Before you reach out to someone, think about his or her style and tailor your approach. You never know which one of your acquaintances may be ready to add thousands of dollars to the pot.
Prepare an “elevator speech” and a media kit (press release, one sheet, etc.). Build a website. Be ready to chat via phone or instant message. Use whatever tools will convert people from interested to invested.
Big investors will likely be less interested in your rewards program. But, they'll likely make up half or less of your funding. For the rest, you'll need to offer people of more modest means a way to buy in.
3. Do the hard stuff first. Making, preparing, and packaging up gifts should be your first concern. You don't have to do it all before launch, but you must make a budget for the cost in time and resources so that your campaign is feasible. Worst case scenario is to make your funding goal, and then spend it all just producing the funder gifts. By the same token, you need to offer gifts for people with $100 or less to spend, as that is where most of your donations will come from. The majority of funders participate at the $25 level, so choose something at that level that will cost less than $25 to make, package, and ship, and you're on your way.
Another reason to give yourself a long time to prep is that it enables you to finish design and marketing tasks, which can be especially time-consuming and might require outside assistance. Invest in a professional designer. Begin work on a logo, a color scheme, a design style, ads, websites, T-shirts, stickers, and so on, with plenty of buffer time built in for mistakes and changes. You don’t want to be creating ads while your campaign is running---too many moving parts to both efforts. Unless there are two people able to devote full-time hours to the effort, you most likely will not have the time to do both well.
Ads and banners, in particular, should also be created ahead of time to conform to a deliberate release schedule. An announcement ad for the beginning, ads to announce events or the inclusion of new gifts, ads to announce that the campaign is ending soon, and so on.
4. Set up social media accounts. Crowdfunding is a social animal. Social networks, therefore, need to be the foundation of your campaign. If you don’t already have a Facebook page and a Twitter account for yourself, set them up right now. After that, create them for your project — not for the crowdfunding campaign, but for the project it will ultimately fund. Your project should also have its own Instagram, Pinterest, and possibly Tumblr accounts. This may seem like a lot, especially if you’re not used to sharing your every thought with the world, but it will pay off.
5. Make a video. Some crowdfunding sites stress this step more than others, but the fact is your campaign will almost undoubtedly do better if it has a video. Again, start early, but that doesn’t mean that the video needs to be fancy. The most important ingredient is you. Make sure your future backers get to see and hear you telling them about the project. Make it clear how their money will be used and sell your story (see #2).
If possible, include images of everything relevant to your project. If you’re planning to make a movie, show your camera, your script, and your stars. If you’ve invented a new way to core apples, demonstrate it — and show how you will manufacture your item. You can shoot and edit the video on your smartphone, as long as it’s personal, friendly, informative, and brief. (Your best bet is to have it run less than a minute, and don’t go over three.)
6. Do your research. A big part of your success is going to come from research. Visit various crowdfunding sites and examine their successful projects. What do they have in common? Are you doing everything that they are doing? Are they doing something cool? Great. Copy it! Spend at least a day clicking through other people’s crowdfunding campaigns and taking notes. Finally, choose one and become an investor yourself. Find out what the experience is like from the other side before your launch your own campaign.
7. Ask for feedback. Long before you launch your crowdfunding campaign — and also before you finalize your graphics, website, ads, or merchandise — ask as many different people as possible for their opinions. Listen to what they say. Accept any criticism and make adjustments, especially if you receive multiple comments on the same issue. Try not to take the feedback personally or argue with people (regardless of your reasoning, if something isn’t working, it isn’t working). Make the necessary changes and move on.
8. Schedule your campaign. The final step is to develop a plan for the duration of your crowdfunding campaign. Don’t let people get bored as the clock runs down. Offer something new and different every day: If it’s a book, offer excerpts; if it’s a product, offer a giveaway. Plan events — online and off — like Q&A sessions, happy hours, or meetups at a popular venue. Contact radio, TV, newspapers, and magazines near you and ask whether you can be interviewed or get coverage during the campaign. (Crowdfunding coverage is common these days; track down columnists devoted to the subject and make sure they know about your project.) Add new banners to your photos and video: 5 DAYS LEFT or NEW GIFTS TODAY ONLY or BUY NOW FOR 50% OFF RETAIL.
If there is no obvious new item to post daily, invent one: a photo of your dog wearing a campaign sign or a link to a website that’s related to your project. Whatever you choose, give people something to follow. Make your crowdfunding campaign entertaining, and you will meet your goal.