Crowdfunding is the darling of the investment trade these days. It’s the middle finger to banks and traditional investors because it gives anyone the chance to gain funding for their venture.
The average person on the street is who you have to impress. These are donations, so you don’t even have to pay them back. You can’t just walk right in and expect to get funding. There are some secrets you need to get your head around first.
Put in the Effort
The basic requirement of a successful campaign is to really put some effort into it. You want your business project to succeed. Spend days and weeks planning your crowdfunding project.
There’s no reason why your project can’t succeed. Crowdfunding is on the rise. The websiteEconsultancy published stats that predict a 91% rise in money raised since 2011, which continues to go up.
Personalisation Always Works Best
Personalise your campaign in the best way you can. You have to make sure that you appeal to an audience.
One success story was Amanda Palmer. She became a cult musician through making regular videos and appearing as a real person. People respond to real people. They want to make sure you aren’t some thief just looking to steal money. It led to Palmer successfully raising $1 million through American crowdfunding website Kickstarter.
It doesn’t have to involve a big screen production. A simple webcam with you sitting in front of it will be fine. Just be honest and tell people what you want to do with their money.
Get Started – The Sheep Effect
Most people will react in the same way as sheep. If their group of friends all has the latest iPhone, they’re going to want to go out and buy the latest iPhone. It works the same way with crowdfunding.
Seth Godin proved this with his own article on the subject. He owns The Domino Project and wrote about how if you get 60% of your goal completed you’re going to get 100%.
What this means for you is you need to get people donating to your project early. If possible, ask family and friends to donate money to you online. This can get part of your campaign completed before people really start to look at it.
If they see other people have donated, this is practically a stamp of approval. It’s a third-party authentication of the validity of your campaign.
Give Them Something Good
Whilst your donations are just that, you can offer perks for people who do decide to donate. For most people, this is a matter of offering something simple, such as a free version of the finished product.
What you offer really depends on what you decide to make as part of your business. Try to come up with something more creative than a simple product, though.
This is where you really need to put the time in to come up with something that’s really going to resonate.
Show you’re willing to go the extra mile. Instead of giving them a version of your product, give them a personalised version as designed by them.
You might also want to consider inviting them to your business to see where their money has gone. Perks like this encourage people to make the bigger donations.
Interacting with Your Donors
How you interact with current donors will influence how other browsers will respond. We give you a small code of conduct for how you should deal with donors here:
- Give regular updates on the project throughout the campaign.
- Send a personalised thank you message to anyone who decides to donate.
- Answer any questions that come from people.
And the most important point of all is to be respectful and appreciative. They’re doing you a favour remember!
Image Credit: Flickr user Lendingmemo