Crowdfunding has become hugely popular in the recent years. It has evolved as a comprehensive validation tool for startups, corporations, and nonprofits, from being a small personal fundraising platform. Investment experts like Greg Skidmore and Gennady Barsky have always considered crowdfunding to be an important and effective way of fundraising. We bring you five most effective ways to run a successful crowdfunding campaign, right from the experts. Read on:
- Establish your motive
Why are you running a crowdfunding campaign in the first place? You might say, “To raise funds.” Obvious thing, isn’t it? But what are you going to achieve with those funds? And is it something the investors are likely to care about?
Before you begin with your crowdfunding campaign, put yourself in the investors’ shoes and ask yourself, ‘Why should I back this? What’s in it for me?’ Remember, your answer should be honest and must include an authentic benefit, either physical or emotional. Once you have your answer, make sure you communicate it very clearly to the masses.
- Use your existing networks
There’s nothing more reliable and convincible than old acquaintances. Contact your family, friends, colleagues, business partners – anyone you know to tell your story behind the crowdfunding campaign. Rope in the power of social media by posting and tweeting, creating a unique hashtag and sharing video and photo updates on your progress.
Running a blog and posting daily updates might also be of help. Make use of all the amazing content you’re gathering, and offer ample opportunities for your contacts to engage and share. According to investment mogul Gennady Barsky, the most successful crowdfunding campaigns get off to a strong start because they put their existing network to some wise and good use.
- Keep it short and sweet
Most crowdfunding platforms give you up to 60 days, but statistics show that actually giving people more time does not necessarily make them give more. According to Kickstarter, shorter projects enjoy the highest success rates as they show confidence and add an element of urgency.
- Provide a detailed budget
Why do you need the amount? Why is it $5,000 and not $2,500? Make sure to provide a detailed budget of the cost of your endeavor. This instills trust among your backers, showing them that you’ve thought it all over. It will also give the investors an impression that you are more likely to use their funds appropriately and deliver the project on time.
- Tell a compelling story
The most important and yet most overlooked part. Clear communication regarding why you need the funding, while engaging the potential investors, is of utmost importance in making a crowdfunding a success. Once a potential backer visits your crowdfunding page, you have less than 5 seconds to grab their attention and then keep it.
Being witty, insightful or entertaining is up to you, but ultimately you have to tell them a story that’s to the point, and clearly communicates what you project is, why you are undertaking the endeavor, and why should they pour their funds in. Be creative and precise about your idea to grab more attention.
We hope that these tips come handy to make your crowdfunding a success!