As an efficient means to raise funds crowdfunding idea is broadly applicable by multiple startups, as well as worldwide giants, like, Google and Lego.
Connecting to potential donors could be pretty challenging, thus, a comprehensive fundraising campaign has to be launched. We’d like to describe key steps to take for facilitating the process, avoiding possible pitfalls and raising the sum you need. Interested? Let’s begin.
Step 1. Define your idea and set the objective
You’re planning to launch your crowdfunding campaign, thus, we’d assume, you already got a brilliant idea to put in practice. Devote enough time to formulating it in a proper way. A clear, well-articulated concept shall reflect your precise and attainable objective.
You have to specifically determine what you’re about to build, open, design, etc. Are you sure present-day society needs it? You have to know precisely what’s the money amount you miss.
Those are the right points to figure out from the outset. It’s a common-sense attitude.
Step 2. Undertake the study
The desired is achieved when a fundraising campaign encourages people to act, meaning to donate funds. To ensure the success of the activities you shall conduct a deep market analysis. Answering the below questions shall help you make the most of your research:
- What do your clients really want?
As soon as you figure out your audience’s needs, you’ll see if your online product will turn demanded. Thus, you’ll also determine some strategies to better your solution and to extend and strengthen its benefits.
- What activities of your rivals were successful, and which of them turned into the failure?
Most likely, history knows some presidents of similar campaigns. Analyze those cases determining the advantages and drawbacks of learning from your rivals’ mistakes.
Step 3. Search for the most appropriate fundraising service
When looking for a platform to create a crowdfunding landing page you’ll have 2 options. The decision actually depends on your startup, since different crowdfunding programs support different projects.
Perhaps, you’ve heard of Indiegogo or Kickstarter which prefer rewarding approaches. The idea is to obtain a certain reward – in most cases, it’d be that product itself – for supporting a startup financially. That would be the best solution when you’re lacking less than $50.000.
In case you’re looking for over $50.000, you’ll need a platform similar to Fundable.com. Being based upon equity principles, such programs imply that accredit investors expect to receive business’ shares for their investments.
It wouldn’t be the best decision to begin a startup at few platforms simultaneously, since:
- it’s pretty hard to devote the appropriate and necessary attention to every web source;
- clients might have less trust due to these inconsistencies.
As you can see, dealing with several platforms in parallel decreases chances for your campaign success.
Step 4. Design marketing strategies
Just keep it in mind that mentioned above platforms won’t do your job for you. Surely, Kickstarter and others are promoting valuable startups, however, the bulk of financing (around 85%) arrives from other resources.
The key potential investors are reached via emailing, blogging, social networking, thus, a marketing planning is a must-have before getting down to crowdfunding activities.
Step 5. Thorough and comprehensive action plans
Additionally to your in-depth marketing strategies, every single project activity shall be carefully thought through and scheduled in advance.
Writing down an extensive watch list for your fundraising actions provides better chances of your campaign efficient breakthrough.
Step 6. Social media
Finding investors via social networks is truly indispensable to guarantee your campaign’s success. It has to be a mandatory aspect of the marketing strategies to devote due time and attention to.
In fact, you’re creating social media profiles for advertising and promotion purposes. You shall be interested in gaining more subscribers and friends to collect the sum you need.
Step 7. Remember on 20-30% principle
Inform your friends about your startup and enlist their active participation and support. Statistical analysis proves that around 20-30% of all funds gathered are invested by acquaintances. Then you increase your possibilities to encourage other investors to act.
It works in a very simple way: backers see people investing in a project, thus, they’re more willing to get engaged as well.
In case your friends cannot contribute money into your project, they still can help spread around the info on your startup via social medias, words-of-mouth, and the rest.
Step 8. Determine the deadlines
Another critical aspect to consider is the best possible time-frames for the campaign. It’s preferable to set from one day to two months period.
Feel the balance.
When scheduling too little time, you get fewer chances to raise the amount you require. At the same time, if setting too long timing, possible investors might take it as your uncertainty and doubts, thus, they may hesitate to invest.
Traditionally, effective crowdfunding lasts around one month. For sure, when having all your strategies and action plans ready beforehand, 30 days are pretty enough to achieve the wanted outcome.
Step 9. Budget wisely
Calculate the budget. Make it fair without exaggerating. Analyze your needs together with your audience’s financial capacity to set an adequate amount. Certain crowdfunding platforms set their policies to return to donors the money gathered, in case a startup collects less than 50% of the sum asserted. Be aware of possible twists.
Speaking of a minimum amount to invest, don’t set it too high, then everyone can contribute. Investing a small amount at a time, donors can contribute multiple times and may even bring the friends.
Well, obviously, there exist lots of aspects to consider creating an extended outline of your campaign to prepare everything in the most efficient way. Only under such conditions all the efforts are worth it and will be rewarded.
Then there’s one more decision to make – you’re dealing with everything by yourself or you’re planning to delegate the task to a team of experts. Assess your possibilities without bias to see if you can cope with yourself. No matter what option you’ll go for, we hope, final outcome shall please you.