A practical guide to crowdfunding your business
It take a lot to be an entrepreneur. You’ve got to have grit, patience, perseverance, a good team, and the right investors. Of all those, the last one is either the easiest or the most difficult one to “get”, depending on the idea.
If you’ve got an idea that everyone understands, has great market potential, and is easy to build or develop, you’ve got a winner.
But if your idea isn’t all those things, and you still believe in it, there’s a way for you to get the money. No, don’t break the bank just yet. Let us teach you how to crowdfund your idea.
Crowdfunding is a way to raise a small amount of money from a large group of people instead of raising a large amount of money from a single investor, bank, or financial institution. In today’s day and age, people use platforms like IndieGoGo and Kickstarter to crowdfund projects on the internet.
How Kickstarter came to be
In 2002, a young musician Perry Chan wondered why there wasn’t a platform that allowed people to pledge to buy tickets for a show. If enough money was pledged, they would be charged and the show would happen. If not, it wouldn’t. That idea stuck in his head, and lead Chan to launch Kickstarter with Yancey Strickler and Charles Adler in April 2009.
This year, the team is talking about crowdfunding a mission to go to mars on their own platform.
Kickstarter has grown incredibly popular, especially because of the power it gives to budding entrepreneurs. It helps businesses do exciting things and ensures that both, investors and entrepreneurs on its platform are protected – making sure that everyone has a fun experience.
— myPRwire (@myprwirenews) April 3, 2018
You can crowdfund (almost) anything
If you’ve got a good business idea, you can crowdfund almost anything. Need a geometrically structured pillow, a leather-bound chef’s notebook, or the world’s first “squeezable” metal bottle? These are all real products on Kickstarter and IndieGoGo.
So, if you’re dreaming of building an AI-powered educational campus in the virtual world, for management executives seeking mid-career professional development, or something similar, you should definitely give crowdsourcing a shot.
Most recently, Elad Burko’s project The Micro Wallet – Doing more with less came to life. It aimed to raise US$15,000 and with more than 60 hours on the clock, it has raised US$ 265,779.
A game, Dinosaur Island: Back from Extinction, on Kickstarter, has met its goal 60 times over, raising US$1,518,699 so far.
So long as you’re on a platform with lots of users, such as Kickstarter and IndieGoGo, you’re going to get a fair chance to raise capital for your project.
How do you go about actually raising it? It’s simple, you register and set up your project on the platform, and wait. Market it on social media to spread the word if you like, but that’s about all that you need to do.
How do you succeed at crowdfunding
Crowdfunding isn’t easy because there’s quite a bit of competition these days. If you want to make headlines and be among Kickstarter’s and IndieGoGo’s next success stories, here are some practical tips:
Focus on descriptions and rewards
When setting up your campaign, make sure you pay close attention to how you describe your product and its benefits. Make sure you say everything clearly and don’t overpromise anything.
Unless the robot you’re designing can really distinguish between commands from the user and everyone else, don’t say it can.
Next, ensure you design enticing and engaging rewards. Be careful about what you offer in exchange for what quantum of financial support.
If you’re selling a set of pencils with a special character embossed on each, giving away a set for US$5 might be a good idea. But if you’re selling a robot, maybe US$5 could get them their name on your website – especially if you’re bootstrapping your product and think that every penny counts.
Take (lots of) pictures of the product
See it to believe it. Humans are very visual. Take pictures of your product if you want any kind of support from investors on platforms such as Kickstarter.
I’m yet to see a campaign without any pictures. Founders even post pictures of their team to reassure investors about the authenticity of the company backing the project.
If you want to succeed, make sure you’ve got the best product shots you can afford. If your product has doors, windows, or even a hidden compartment, open it and take a picture. Show everything. That’s the only way to earn the trust of the people who will, perhaps, invest in your project.
Get a video, or two, or three
What’s better than pictures? Videos! Pictures speak a thousand words, but a video lets you tell a story.
If you’ve got the budget for a video, make sure you talk about the product and explain how you’ll make it come alive. Whether you need the funds to hire the people to help you bring your project to life or expect to use the money to produce something at scale, tell everyone. Be authentic. That’s the only way you’ll find any success.
The reason crowdsourcing is reliable is because the internet, collectively, investigates every project – and someone is bound to find the skeletons in your (product’s) closet if you don’t own up to them.
Get a video, tell your story, focus on the product and how you’re going to deliver on your promise, and voila! You’ve got a winning video at hand, one that’s perfect for investors on crowdfunding platforms.
We spend 1/3 of our lives in bed. Why not spend it surrounded by a healthy environment? #indiegogo #crowdfunding #kickstarter #indigodye #indigo #organic #atopicdermatitis #rosacea #eczema #getinspired #blue #japan #bedding #organicbedding #goodforskin #textile #cotton pic.twitter.com/FYOPhIZ3gs
— Aizome Bedding (@aizomebedding) April 17, 2018
Launch a social media marketing campaign
Get hold of a digital marketer or get a graphic designer to whip up some creatives, and promote yourself on social media. Get eyeballs. Get people to notice you.
You’ve got a product idea that’s unique and the only way you’ll win is by getting as many people to view it as possible. There’s no doubt that active users on crowdfunding platforms will see what you’ve got to offer instantaneously, but there’s no harm creating awareness about your product.
You’re here to make a difference. You’re here to tell everyone how your product will change the world. So tell them. On social media. With a social media campaign.
Get some influencers to give you a hand
Finally, how about getting some influencers to help you out? Although this isn’t perfectly suited for some products, it’s very useful for others.
If, say you’ve got a tech product or a game, send it to an influencer, request them to review it on their channel, discuss a pay if it’s required – or settle for an honest review if it’s offered, and hope to get noticed by millions of their fans – people who’ll listen carefully to what it is that you’re actually doing.
For those with a product idea, this is difficult to do – but not impossible. Discuss with the influencer if they’re willing to tease the idea with their followers and see how they react.
— イルカショーをボイコットをしよう (@matissecockerpo) April 17, 2018
Is crowdfunding just for startups?
No! It’s not. There are companies that are making crowdfunding part of their business model. Especially those that make consumer electronics, collectibles, and games.
Pandasaurus Games, Restoration Games, and Cyan Worlds, Inc. for example, are some new-age companies that use crowdfunding not only to bring ideas to life but to also test the viability of product ideas and to sell them in the real world, at the same time.
If you’ve got a new product on your mind but you’re not sure how the market will receive it or if you simply need funds for your next new business, log onto any of the popular crowdfunding platforms and get cracking.