Crowdfunding is proving increasingly popular and effective when it comes to startup investment. Follow these steps to maximize your campaign’s chances of success.
By Dana Ostomel (Founder & Chief Gifting Officer, Deposit a Gift)
Crowdfunding is a great way to finance your business ambitions and put the power to launch and grow in your hands. It’s your job to make your case, and if done right, the people who believe in what you do can help make it happen, instead of a loan officer or investor deciding who may not even be in your target market.
Whether you’re just starting out as an entrepreneur or are the owner of a small business looking to expand, crowdfunding platforms give you the ability to raise the money you need without having to go the route of traditional financing or investors.
What Crowdfunding Involves
By definition, crowdfunding is the act of using your social network to raise money online from many supporters into one fund toward any cause. Deposit a Gift is one crowdfunding platform that is highly customizable and easy-to-use for both personal and organizational fundraising.
A successful crowdfunding campaign has two key components: the setup and the marketing. I’d argue that it’s a 40/60 split in importance, with marketing winning out. So you want to take the time to set up your campaign right, but then it’s all about the marketing and your ability to leverage your social networks.
Here is a list of eight things you need to do to get your campaign ready to share!
1. Get Your Pitch Perfect
Crowdfunding sites provide the platform for you to easily create a campaign, but it’s up to you to fill in the blanks and grab people’s attention. Your campaign must have a clear, concise and compelling story.
Why should they give money to you? Share the purpose of your campaign by giving the necessary background to your business idea to get them involved in the journey so that they want to help you see it through.
Make sure it is engaging, personal, and credible – if you can add an emotional component, even better. In short, you are trying to connect.
What can you do to reach through that screen and make them feel what you’re all about? Passion goes a long way.
Be sure you can answer questions like:
- How is this idea game-changing?
- What will this investment do?
- And what will they get in return?
Not every crowdfunding campaign requires perks (for example, if you’re giving to a memorial fund, there is no expected exchange). For business campaigns, your closest friends may give because they love you, but to tap into their greater networks, you want to offer something good.
2. Visuals Speak Louder Than Words
If you’re thinking, “It doesn’t matter how my campaign looks,” then you are mistaken. People don’t read. They respond to visuals.
You’ve got about three seconds to catch their attention when they land on your page. Your visual could be a logo, the product, your business location, you and your team or the people you will be serving.
If you can do a video, even better. Keep it to two minutes or less. This is an opportunity to give your pitch directly, bring energy to your campaign with music and showcase your product idea and more. Visuals help you connect, so be sure to choose the right ones for your objectives. Don’t even think about launching if you haven’t secured the visuals that accurately reflect your desired brand image.
You want to make your page pops with not only visuals, but also color. Stay far away from those white backgrounds and add some color into your campaign page to really draw people’s attention.
Don’t think that adding color makes your page less professional. This is the fun part of creating your site, so enjoy customizing your campaign and giving it some personality to match your brand attitude.
3. Set a Goal
You must set a goal and it should be based on a budget you’ve done the numbers for. You’re asking people for money, and part of the job of the campaign is to explain exactly what you need the funds for and how you will use them.
If you can’t back up use-of-funds, then you don’t have a campaign.
Be realistic with your goal. Keep it lower rather than being overly aspirational. There is nothing wrong with blowing through your goal and beating it by 200 percent (and it can even be a great PR tool!), but setting your goal too high could cause you to have a difficult time demonstrating traction.
Giving begets giving. It’s critical that within the first week that succeed in whipping up a frenzy of giving and show that you’ve got an active campaign that is making the thermometer rise.
Crowdfunding is like high school – people go with what’s popular. Deciding what to set your goal at will affect this, so choose wisely. Goals can be very motivating when set carefully.
4. Be Specific and Offer Rewards
Show supporters what you need the money for and how you will use it. You want to be as specific as you can so they can wrap their head around the need. People are often more willing to give when they know how their money will be used. This is an opportunity to demonstrate thought, transparency and business savvy.
Your ability to offer rewards will depend on the type of business crowdfunding campaign you are doing, though in most cases, you can think of something that will be appealing. Part of how you devise your rewards plan should depend on your business objectives.
Beyond just raising money, what are your other metrics for success? Is this a brand awareness campaign, a PR stunt or a campaign to test the marketability of your business idea? These metrics will help you determine if you should be giving out free product or offering services that keep people coming back. Be creative, but also consider what it will take to fulfil these rewards and make sure you will be able to do so.
5. Create a Roadmap (Without the Roads)
Now it is time to create a marketing plan. This is one of the most important steps in the setup process.
You need to visualize the duration of your campaign and determine milestones and weekly goals. But, you also need to visualize your campaign daily and determine what your duties will be each week.
In doing this, you create a plan to get the word out about your campaign – think of it like a macro and a micro plan. Contrary to popular belief, the internet will not just shower you with money. It takes work. Be strategic and be proactive.
6. Look for Excuses to Follow Up
Stay in constant communication with your supporters by looking for excuses to reach out for different reasons: giving updates on your progress, giving shout-outs to people helping or announcing special occasions like your birthday that are reasons for people to give.
The more you can create a relationship with your supporters, the higher your chances of success, so engage them at every opportunity.
7. Show Appreciation
Don’t forget to show your appreciation to your supporters. Saying thank you always goes a long way in priming the pump and curbing buyer’s remorse.
There are many ways to do this like in the form of an email, handwritten thank you notes, public acknowledgements in social media (known as the tag n’ thank method) or even making a personal phone call.
Sometimes when people hear crowdfunding they mistakenly think that it’s all about the crowd. They forget that this is still a relationship business, that there are people behind the computer and that these people will be the gateway to their greater networks. So you need to be savvy about tapping into that. A good way to think about it is having a one-to-many approach.
Now you’re officially a crowdfunding pro! Creating a fundraising site on behalf of your company or entrepreneurial pursuits is simple, fun and hassle-free.
It’s a great way for you to generate excitement about your project, but it does take work and you need to have a strategic plan for both setup and marketing. Have fun while customizing your campaign to reflect your mission and what you hope to accomplish.
The key is marketing your campaign to the max to generate excitement about your project and to get people on board. Through these eight easy steps, you’ll make an engaging and effective campaign that will ultimately help you reach your goal.