Crowdfunding to help make your business idea a reality
Let’s look at little closer at the options young (or old) entrepreneurs have when it comes to financing their business idea. It seems like no matter how crazy, quirky, or outrageous your business idea is, if you have a clear vision, you’ll have a higher possibility of someone willing to buy into your endeavour and help you make a reality of your startup dreams. Of course, if everyone could raise funds for an idea, then every single person would be doing it, so we’re going to give a few pointers to help you succeed in your crowdfunding campaign.
People love a good story
Investors want to know about the history behind your idea. They want to get to know you. They want to get to know your product and discover if it is worth their investment. You’ve heard people say that some products “practically sell themselves”! Before a product “sells itself” there’s a whole lot of legwork that needs to be handled, and it all comes down to whether you can convince potential funders to believe in you to make it happen once you have the money.
Being able to passionately speak about your product is important, but you also need to know your numbers. How much do you need? How did you get to that number? What has the market research and analysis revealed about the product? The more specific you can talk about what you need to bring this idea to life, the more confidence your funders will have that you have your stuff together and you can be trusted to spend their money wisely.
Kickstarter vs. Indiegogo
Setting the right funding goal is also a big point for your investors. When it comes to Kickstarter, it’s all or nothing. If you don’t reach your goal, you move directly to Go, and you do not collect $200. If you’re going with Kickstarter, be realistic about your goal. But don’t aim too low either. This may bring confusion to your investors and undermine the value of your business. Investors are there to support you and invest in you and your business idea. However, don’t be fooled, every investor is always looking at the big picture and “what’s in it for me?” Remember, this is a money making opportunity for everyone. It’s crowdfunding, not crowdcharity.
Crowdfunding sites like Indiegogo will let you keep all the money that has been funded, regardless of whether you reach your initial funding goal.
Who is the crowd funding you?
What you need to realize about crowdfunding campaigns is that most of your funding will come from your friends, family, and personal network. So be realistic when you are setting your goal because you may already know the people who are going to pledge their funds. And they may already know you. Of course, there’s always the chance that new members will jump on board, but you are most likely reaching out to the same network that helped you conduct your market research.
Passion, persistence, and realistic projections are the key to a successful crowdfunding campaign. And, offering a little reward, as long as you can follow through, to your funders never hurt anyone.