There are literally hundreds of crowdfunding sites out there right now, so choosing one is key to a successful crowdfunding campaign and can be the difference between fortune and fizzle.
For the uninitiated, crowdfunding is the latest (and possibly the greatest) way to get funding for your business idea, start-up, cause or appeal.
It works like this:
- You create a campaign that’s typically 30 to 60 days long and create a campaign page on one of the available crowdfunding platforms. Offer “rewards” that motivates people to “support” you with cash.
- You decide on a goal (the amount of cash you want to generate).
- People review your campaign and rewards, pledge anything from $1 to $1000 or more, and at the end of the campaign, you get the funds.
Sound too easy? You’re right.
On some crowdfunding platforms, you keep any pledged cash when the campaign ends. At others, you don’t get anything unless you reach your goal.
Some crowdfunding platforms specialize: some are for local causes, some for creative projects, some are for campaigns in a specific country, some are only for technological ideas.
Only a few of the top crowdfunding platforms drive any appreciable traffic, so when you launch your campaign, you better be ready to promote the heck out of it, and drive your own traffic to your campaign page. Campaigns that rely on organic traffic hitting the crowdfunding platform almost always miss the mark, and generating the volume of promotion needed can be a full time job.
Picking your rewards is a tricky process too. If your campaign is designed to generate enough cast to bring a new product idea to fruition, you may be able to “pre-sell” the future product and generate a ton of cash, provided the idea is really attractive. One fairly recent campaign like this generated almost $8,600,000. (Yes, that’s not a typo. Eight and an half million dollars).
Craft a great pitch
Most successful campaigns feature a funny or entertaining video, but not all. Sometimes a great slide presentation is enough to get your point across. It really depends on the audience you’re trying to attract and the platform you’ve chosen.
For the right product or service, crowdfunding can be a fantastic way to generate capital, get a product off the ground, build a customer base, test a new product idea, or generate some visibility.
Legitimate crowdfunding platforms only charge a fee based on the cash you actually receive, so on first blush, it seems that you’ll have no real up-front cost. But that’s not really true. Successful marketing can be done on a shoestring now, but you’ll need to purchase some services to get to your goal.
Like everything else worth doing, it’s worth doing it well, so do your homework. Review similar campaigns to yours well before you decide whether or not to put the time, energy and cash into a campaign. Understand your audience, learn from people who’ve done it before, and measure what happens.
David Andrews is a partner at Cult of Three, Inc. Cult of Three specializes in creating and implementing performance based crowd funding programs and only share in the results.
Related posts:
Gary Shouldis
Latest posts by Gary Shouldis (see all)
- 5 Little Life Tips from Big Name Entrepreneurs - August 13, 2024
- Small Business Toolbox – August Tenth - August 10, 2024
- Small Business Toolbox – August Fourth - August 4, 2024
