Learn how to optimize your crowdfunding campaign to get the results you need.
Most startups believe that crowdfunding is fast becoming one of the best ways to raise the money they need to fund their projects. In fact, according to an infographic published by GoGetFunding, a popular online crowdfunding platform, $2.7 billion was raised exclusively through this route in 2012.
According to PleaseFund.us, an online crowdfunding platform that specializes in funding creative projects all over the world, crowdfunding refers to “the collective cooperation, attention, and trust by people who network and pool their money and other resources together, usually via the internet to support efforts initiated by other people or organizations.”
There are basically four crowdfunding models – reward-based, donation-based, equity-based and lending-based. Of these four, the reward-based model experienced the highest market growth and industry share in 2012. Some platforms allow startups to keep what they raise while there are also those that operate on an all-or-nothing basis.
Most crowdfunding platforms are based in North America (59%) and Europe (35%) while the rest are scattered around the world.
Tips to Increase Your Chances of Crowdfunding Success
If you want to optimize your campaign for success, here are are some tips, strategies and techniques that you should consider:
Tell a good story. While your goal is to raise enough money to fund your project, you should refrain from asking for money from the get-go. Instead, you should tell your story and share your enthusiasm for the project. Keep this in mind and you will surely grab your audience’s attention and compel them to support your cause.
Raise some money before launching your campaign. Research shows that raising at least 5% of your goal before launching your campaign can improve your chances of success by 80%. In addition, raising some money prior to launching can help you get the market validation you need. It can also help your campaign to be featured at the top of the list in your category.
Pick the right platform. After deciding which model you want to adopt, pick the right crowdfunding platform that will work best for your project. Kickstarter and Indiegogo work best for rewards-based projects while Crowdfunder and Circle Up are great for raising funds for equity-based campaigns.
Let them know what’s in it for them. If you are adopting the rewards-based model, give your backers a unique and extremely compelling reward. On the other hand, if you are running an equity-based campaign, carefully consider the terms that you will offer to your investors.
Leverage social media. Keep in mind that while you do not need to be all over the place, having a wider reach will increase your chances of achieving your goals. For best results, choose the platforms where your ideal investors and those that match your marketing and content strategies are.
While there is no way to ensure success, following these strategies can help you optimize your crowdfunding campaign and take you one step closer to achieving your goal.