Crowdfunding through various websites can be a great tool for businesses. Not all projects have benefits that are immediately obvious to venture capitalists, and some creators are inherently at a disadvantage when going before boards to ask for funding (particularly women and people of color, especially women of color). Connecting directly with passionate, small investors can help a project get off the ground.
But that doesn’t meant that crowdfunding is fool proof! If your crowdfunding campaign didn’t get off the ground, here are some things you might have done wrong – and how to do better next time.
Failed to tell a compelling story
There is no crowdfunding formula for success that works for everyone all the time. The best way to the average person interested in what you have to say is by sharing a narrative. At the most basic level, humans respond to stories. Reciting a bunch of facts and details about a product can be a compelling sales pitch once you engage your audience’s attention, but it’s a story that will capture their attention in the first place.
What to do?
Find a narrative around your product. Who is the ideal customer for your service or item? What is their life like before and after they find your product? This story can be told in the third person, about a beta tester, or in the second person (You get home and find that yet again your floors haven’t cleaned themselves while you were away. Enter Roomba!). Be careful with this technique, however; applied poorly, it makes you sound like an infomercial.
If you aren’t a good writer, hire a copywriter to craft this piece for you.
Did not have a solid business plan
While your story is what gets backers interested in your project, they also want to know they’re giving their money to a cause that is likely to succeed. This means that you need to communicate not just what you’re making, but how you’re making it, and why it’s going to be a successful project. There’s nothing more frustrating than backing a crowdfunding project only to have the rewards never materialize.
What to do?
Don’t throw up a crowdfunding page the moment you have a good idea, figuring you’ll sort it out once your project is fully funded. Build a solid business plan and communicate the basic details of it to your backers. This will also give you a chance to get a realistic estimate of the cash necessary for creating your project, as well as the ultimate timeline for delivery. It may also give you ideas for the most compelling potential rewards.
Did not engage social media
A real question you need to ask yourself after a failed crowdfunding campaign is how well you motivated social media to share your project and intrigue new audiences. You can’t fund your campaign with friends from work and family members, though you certainly can convince them to share your message out to their extended networks.
What to do?
First of all, remember that different social media networks need different approaches. What works on Instagram is different than what works on Facebook which is different from what works on Twitter. Using a one-size-fits-all approach to social media promotion will leave you with an approach that doesn’t really work anywhere. Customize your approach on each platform so that it has the best chance of being seen.
Did not engage local and trade audiences
Word of mouth is still a powerful force for advertising in the business world. Crowdfunding is not only about money, getting the message about your product out to local and trade press along with bloggers and influencers is crucial. If you haven’t reached out to those people and made them part of your team, your campaign is less likely to succeed.
What to do?
Create a press or media packet. Make a list of bloggers and journalists to target, along with publications that access press releases. If you don’t know how to write a compelling press release, hire a copywriter (sensing a theme here?) to do it for you. Also make yourself easy to reach; include media contact information on your crowdfunding page, and make sure to check it often.
Respond to requests for more information, both from interested backers and from media. Having a reputation as helpful and engaged will only help you as your project proceeds.
Crowdsourcing can be the right answer to make your business a long term success, but you need to do your research. Find the right venue, learn about what makes the best crowdfunding projects a success, and adapt those strategies to your own project.
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