The introduction of crowdfunding has revolutionised the way startups and businesses raise capital. To be more precise, it has democratised the market by offering entrepreneurs more options to raise money for their projects, grow customers’ community, and network with donors and investors.
Even though one can now launch a product without bank loans and excessive paperwork, the competition in crowdinvesting is very high, and investors are very picky. So, it’s become essential to understand how to succeed in crowdfunding and how to run a successful crowdfunding campaign.
12 tips on running a successful crowdfunding campaign
Depending on the project specifics, there can be many strategies to a successful crowdfunding campaign. Here, we have collected the fundamental essentials on how to launch a successful crowdfunding project that will be equally useful for newbies to get familiar with and for experienced players to refresh and even deepen their knowledge. Regardless of the niche your business belongs to, we invite you to take a look at the recommendations below.
Choose the right crowdfunding platform
Crowdfunding today can serve a wide range of purposes, so choosing a platform that hosts similar projects, has the necessary tools and interface, is vital.
But what is more important, it must cater to the right audience. Your campaign may be well-designed and thoroughly planned, but all the effort will result in nothing unless you reach out to potentially interested people.
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Include your LinkedIn and social media
Make transparency one of the major pillars of your strategy to establish trust. To achieve that, investors need to see and trust people behind the campaign. Also, it can help backers to connect with you on some personal level and, for instance, see that you share common values or experiences. We’ll speak more about that below.
Get backers before your campaign goes live
Statistical data shows that most successful campaigns get 30% of funding during the first week of a crowdfunding campaign. That’s why it is highly recommended to find backers before you launch a campaign. So, start thinking of building the early adopters base early on during your project.
As challenging as it may look, there are more ways to do that than you think. You can start with you close inner circle, social media, friends, and other resources you have at your disposal to spread the word about the product. We’ll cover in the paragraph below how to accumulate that early adopters network.
Leverage your network
Who can be the backers? Everybody.
Ask your family members to support you, notify your colleagues, friends, and social media contacts – everybody can contribute.
Use as many channels as you can to spread the word about your product since it all comes down to the six handshakes rule. On top of that, people from your friends’ or relatives’ circle can indeed become future customers.
Eliminate potential risks
Donors believe that crowdfunding is risky because it requires investing in a product or service that doesn’t exist. Right from the start imagine yourself in investors’ shoes to see what major risks your campaign entails. Where do you think the major risks lie? Is it about the doubt that there will be an audience for your product? Is it about the tech implementation? Think through of them well in advance.
You can reduce or even eliminate the perceived risks if you know how to start a successful crowdfunding campaign.
To begin with, you can choose all-or-nothing crowdfunding modes. It means that donors will know that they will receive their money back if your project doesn’t raise the required funding.
On top of that, not only indicate the target sum but include a breakdown of how you will spend the money. It will demonstrate to investors that you have planned everything and help them envision how exactly they are assisting the project.
Tell about yourself
It is a great way to stand out. While other project owners describe the project only, you can add some details about yourself, such as your experience, personal and professional interests, along with your successes in the past.
Investors are giving funds not only for your project but also for the people who will deliver it, this is why letting them know who you are and why they can rely on your expertise is fundamental, if you want to get the most out of your crowdfunding campaign.
Support other projects
Reciprocity plays a powerful role in online communities, and the crowdfunding community isn’t an exception. You may notice that the most impactful crowdfunding campaign strategies include such details as backing other campaigns.
Some platforms, such as Kickstarter, provide data on how many projects you’ve donated to. When people see that you support other projects, they are more likely to support you. Besides, it’s another collateral factor that proves your trustworthiness.
Create a great story and accompany it with a video
Telling a great story requires some skills and knowledge. Your story needs to contain information about what problems your project will solve. Make sure it’s well-edited and well-paced. If your potential donors see an amateur video, they may think that you aren’t that serious about the project or professionally equipped to deliver it.
Pick the proper rewards
Giving relevant rewards is one of the main strategies for a successful crowdfunding campaign. To make sure all is clear here: we aren’t talking about equity- or lending-based platforms where funding is provided in exchange for specific financial benefits, nor are we talking about donation-based campaigns where donors give money to help people in need.
What rewards can you give? The most common bonuses are copies of a project if applicable. For example, if you are raising funds to record a music album, you can give your backers copies of the album. Other benefits may include mentions on social media or in the project, unique experiences (e.g., visiting a recording studio), exclusive items, and similar.
Create a few reward tiers
Create tiers and assign rewards depending on them.
To attract a large pool of potential investors, consider a few reward tiers that may suit people with different interest levels and financial capabilities. It will also motivate the possible donors to give more money to get to the top tier.
There can be many options: from symbolic merchandise, like branded bracelets, hoodies, shopper bags to a product discount or early access.
The wider the range, the more backers your campaign may get.
Advertise your campaign
One of the most essential tips for running a successful crowdfunding campaign is not to be shy and silent! Advertise it wherever you can.
Post about it on all social networks, tell your relatives, friends, business partners, and colleagues, and ask your Facebook contacts to support you. If you see that a platform you’ve chosen for the campaign offers some advertising services, check if they can also be helpful. The more people know about your campaign, the more donors you will eventually get.
Create the buzz around your campaign before it is launched, and once it is live, update your followers about each milestone taken. Include a strong call to action in each such update. Encourage the readers to move to the next step before the funding round ends.
Communicate with the backers
While you need to promote your campaign constantly, remember about those people who have already provided you with some funding. You need to update them on how the project is moving and what milestones are achieved, reply to their comments, share updates, and thank your donors.
If there is such an opportunity, give them more perks and surprise them with exclusive rewards that were not announced. This will demonstrate to others that your project deserves funding also because of your attitude to donors.
Who we are?
CrowdSpace is one of the leading crowdfunding platform aggregators where you can stay in the loop of the most actual developments in the crowdfunding world and find relevant crowdfunding providers. On top of that, you’ll find:
- platform reviews;
- exclusive interviews with crowdfunding providers;
- tips on how to successfully participate in crowdfunding for investors and project owners;
- advice on how to choose the best projects to invest in.
CrowdSpace offers filters and handy tools, allowing you to sort platforms by country, business sector, investment amount, and ECSP licence availability.
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Let’s summarize
As you can see, a successful crowdfunding campaign is like a successful business that requires a lot of effort, expertise, and teamwork. Your strategy should make your crowdfunding campaign stand out from a million others.
It’s not an easy venture, so make sure you’re well-prepared and follow all the tips for a successful crowdfunding campaign to raise the target sum.
