The Magic Behind Crowdfunding: What Does It Take to Run a Successful Campaign?
Crowdfunding is an incredibly powerful tool, but it’s also dangerous. Crowdfunding accounted for 30 billion dollars in 2015. A report by Forbes even suggested that crowdfunding could overtake VC as the majority source of capital in 2016. There’s no doubt that a crowdfunded campaign can empower a new business that’s offering an exciting proposition, but it’s far from a sure thing, and you need to be able to prove to your audience that you can deliver on those promises. Let’s take a look at just how that’s done.
The first, all-important step is to set a realistic funding goal for yourself, but what exactly should your fundraising goal be? If it’s too big and too daunting for the project you’re trying to put together, that is a quick and easy way to turn people away from your campaign.
Instead, you should take the time to measure out exactly what you need. Don’t overestimate just because you think you can get it. If a lot of people are genuinely interested in investing in your idea, they’ll blow past your goal anyway. As long as you have stretch goals in place that are realistic to expect of your team, that’s perfectly fine. Aim small and hope to hit a lot bigger.
Every successful crowdfunding campaign always comes with a good story. Venture capitalists are sold by a belief that your company can make them money. Crowdfunders are sold when they believe that you are really building something special that they can be a part of. That all begins with story.
People want to be wowed by your presentation. If you can appeal to their emotion with a story of your business, your trials and tribulations, and how your product could make their lives better, they’ll be more likely to give.
The best way to tell your story is with a compelling visual presentation. Make it smart and make it pretty. Don’t overwhelm with too much color or too much noise. A nice, simple layout will always win out, and the centerpiece of all that should be a video that tells your story and communicates to your backers why they are the heroes of the journey you’re embarking on together.
Show some heart and some personality too. This is actually an arena where startups have it better than the big corporations with all the resources. Potential backers can see the people behind the product. Don’t be afraid to show who you are. Let them relate to you and everything you want to achieve.
Once you have your goals and your story in place, now is the time to begin showing your campaign to the world. With the sheer number of crowdfunding efforts out there these days, you need to make sure your promotion stands out from the competition.
Having a unique idea and a story to explain is a great place to start, but there’s more that goes into successful campaign marketing.
Use every social media tool you have at your disposal. Contact bloggers and media, anyone that has an audience and an interest in sharing your idea. It won’t be easy, but once you get it rolling, a campaign can catch like wildfire if you really have something that people want.
The final, most important piece is trust. People need to believe 100% that you are going to deliver on every promise you make. The best way to do that is to reduce the risk in the mind of your backers.
Go with the all-or-nothing model if you can help it. It’s the quickest and simplest way to show your funders that you are as committed to the long haul as they are. If you really want to build something and follow through, it shouldn’t be a problem.
Once production begins, keep your backers updated. Show them what exactly you are doing with their money and how it’s all crucial to the success of the product. This serves two purposes. It shows your audience that their contribution really matters, and that you are really using that money in a way that makes sense to them.
Too many campaigns fail because backers can’t be sure that their money will be used properly. Dispel those misconceptions immediately. Show that you and your team have the skill and the experience to get the job done. If you support it with metrics, updates, and that story of yours, they will believe you. There's no force more powerful than that.