Crowdfunding is defined by Wikipedia as the “the practice of funding a project or venture by raising many small amounts of money from a large number of people, typically via the Internet”. A fruitful crowdfunding campaign has the power to provide your business the requisite fiscal stimulus, if implemented correctly. But in order to do that, one needs to devote effort and time in drawing up a strategy and looking for the right platform.
What are the key aspects in executing a successful crowdfunding campaign?
A solid goal is required
Your crowdfunding campaign will need to begin with a clear objective that people (potential investors, partners and staff) can resonate with. This goal necessarily needs to be articulate, detailed and as mentioned before, very solid. A clear strategy will give your investors a sense of confidence and ownership – they should be able to visualise the entire project from start to finish.
When starting out, there will be many expenses that will need to be covered, but remember to highlight your main objective and pursue financial options for that. Once you have this clearly laid out, your corwdfunding project will seem more manageable.
Determine your funding
It is crucial to raise the right amount of money for your project. Therefore, estimate all your expenses by outlining plan explaining your specific financial needs. A clear financial strategy will allow you to determine which type of crowdfunding will suit you best. And remember, each type listed below has its own rules and funding limit : – Rewards based – Equity – Debt-based – Litigation – Charity
The target crowd
Once you’ve determined your avenues of funding, you now need to shift your focus to the crowd – you target group. Your objective is to lure a particular demographic or community, who will be interested enough to share your campaign with their peers.
The audience you’re speaking to is of paramount importance here. And for that, it is crucial that you have good incentives, rewards and perks. In order to draft a realistic proposal, do exhaustive research into the segment you’re targeting, interest rates by competitors, etc.
In addition to the rewards you’re advertising, you will need to prepare a pitch where your potential investors can get all the details – e.g. your timeline for the project, the business’s target group, expenses and a forecast for budgets. Being completely honest about your plan, will help your investors decide more carefully and faster, and will probably appreciate the transparency and publicise your work to other clients.
The Plan Going by the nature of this project – it is inherently ‘team work’. Therefore, you need to connect rigorously with the crowd. This will entail a marketing and communication plan, with details like a strategy mapped out, staff profiles, their area of expertise within the project and PR stories for the press.
You can use any channel of communication for creating the requisite buzz for your campaign – online, offline or traditional. Think of this plan as a daily diary that you’ll need to keep updating for the ‘crowd’ who are so heavily invested in your campaign.
The Crowdfunding Channel
Once the groundwork is done, it’s time to go online with your campaign. There are several ways to go about doing this. You can either create your own site, with payment and crowdfunding tools. Or you could register with one of the many crowdfunding online platforms out there – the kind of crowdfunding you decide to go with, will determine the platform you are most suited for.
Registering with any of the crowdfunding platforms is easy, but do read the rules and do as they say. Or they might blacklist you. Some of the more popular platforms are: – https://www.kickstarter.com/ – https://www.indiegogo.com/ – http://www.rockethub.com/ – http://peerbackers.com/ – https://www.crowdfunder.com/
Follow Up after the Campaign Once your campaign is over, get ready to finally launch or start production on your project. Remember to update your investors and clients – they saw you through the hard times and they deserve to know all the details once your campaign is up and running. There might be a twist in the tale for you – where you haven’t reached your funding target and need to begin afresh.
Do not forget to keep your investors and clients posted about your next steps and tell them that you appreciate their support. Remember you can get valuable advice and insights from them that could help your business grow.