At the time I’m writing this blog post, over $3.2 billion has been pledged on Kickstarter towards technological, creative, and entrepreneurial projects.
More than $48 million has been invested on WeFunder, an equity crowdfunding website, which enables startups to grow into big companies.
Right now is the BEST time to seek out crowdfunding dollars to start, launch, or grow your business.
With a video teaser, “perks” or “rewards,” and effective storytelling, you can raise a bunch of money from a crowd of supporters who are invested in the continued success of your company.
Sounds, too good to be true, right?
Well, I haven’t told you the entire story.
In fact, I left out a scary statistic.
Did you know that on average, 60 – 70% crowdfunding campaigns fail to raise funds on Kickstarter?
This statistic is higher for categories, like Technology, which sees an 80% failure rate.
While the opportunity is certainly out there, you have to know what you’re doing if you want to succeed in the crowdfunding arena.
I’m going to share with you a few tips when it comes to getting crowdfunding for your business, along with a proven plan that works when it comes to getting funding for your business.
1. Set Aside a “Launch Budget”
I know it sounds counterintuitive. After all, aren’t you going on a crowdfunding website to GET funding?
The reality is that crowdfunding has become SO POPULAR that you’re going to need a competitive campaign if you want to stand out from the pack.
You stand the best chance of crowdfunding success when you set aside a launch budget that goes towards:
- Mentorship
- Video production
- Marketing
- Advertising
- PR and press releases
The reason that I put mentorship first is because I’ve seen so many creators on my forum, KickstarterForum, waste a ton of money on their crowdfunding fundraiser.
I’m talking more than 6,000 users and counting!
Many users regret the fact that they didn’t plan better and seek out mentors before they launched their crowdfunding campaign.
Now a days, if you want to raise a decent amount on Kickstarter or an equity crowdfunding website, you’re gonna want to budget about $5k or even more. It depends on how much you’re looking to raise.
Thankfully, it’s all worth it. The exposure that you get with a fundraising success not only makes you a compelling media story, but it also ropes in even more customers for your business.
I’ve interviewed many entrepreneurs on my podcast, Crowdfunding Demystified, who have literally started their six or seven business as a result of Kickstarter.
2. Educate Yourself as Much as Possible
If you’re already a business owner, you’ll know how much traditional education sucks.
It doesn’t prepare you for the real world. Not at all.
This is why you’re going to need to study up on how crowdfunding works, how to get backers, how to drive traffic, and more.
Over the last few years, I’ve been working hard to educate entrepreneurs about the various aspects of crowdfunding.
I’ve done this with my blog, podcast, youtube channel, books, and public speaking.
I also offer comprehensive online courses which quickly get you up to speed on the techniques that are proven to work when it comes to getting funding.
I’ll show you exactly how to get backers, surpass your fundraising goal, and become a crowdfunding success story.
If that sounds good to you, you can join my free video training program here. I’ll send you a few free introductory videos and also introduce you to my premium content.
3. Choose the Right Crowdfunding Platform
There are many different types of crowdfunding.
There is:
- Real Estate Crowdfunding
- Personal Crowdfunding
- Nonprofit Crowdfunding
- Kickstarter and Indiegogo
- P2P Lending (Debt-based Crowdfunding)
It’s easy to get confused and try to raise money on GoFundMe for a business (bad mistake).
You have to choose the right crowdfunding website for your fundraiser. Typically, for business-style projects, I recommend looking into Kickstarter, Indiegogo, and these equity crowdfunding websites.
The platform that you go with is going to impact how you do your marketing for the campaign. It also decides the type of functionality that you have available to you.
For example, if you decide to raise money on Kickstarter, than you’re going to have to brainstorm some rewards that you can offer to your project backers.
Rewards or perks are what the backers gain access to once they pledge money to your project. Often times, entrepreneurs will offer the finished physical product as one of these rewards.
In this way, the actual Kickstarter campaign functions as a “pre-order” for that product. Once the entrepreneur gets funding, then they go out and mass produce the product for the backers.
On other crowdfunding websites, this works differently. If you raise money on SeedInvest, Start Engine, or WeFunder, then you’d actually be giving away an equity stake in your company.
When individuals invested in your campaign, they’d gain ownership in your company and have a right to future profits.
4. Put Together a Pre-Launch Marketing Plan
I’m going to share a little secret with you.
There is a reason that you see campaigns in the media that raised “a bunch of money” within the first few days of launching. It’s not by accident.
They put together an effective pre-launch marketing plans which ensured they’d hit their fundraising goal EARLY, so that they could trend well on the platform and keep raising funds.
If you want to smash your crowdfunding goal early and keep raising funds, then you’ll need a pre-launch marketing plan.
But… what exactly is this?
Simple.
Build a crowd before you need it.
This could mean:
- Gathering email addresses
- Building up social media followers
- Attracting first and second degree connections
A more advanced topic could include scheduling media hits that build hype around your project.
All of these strategies are done by successful crowdfunding campaigns, but they’re done behind the scenes.
This is one of the reasons that I urge you to join my free training course that will show you how to smash your goal on Kickstarter.
There are a lot of things that are done behind the scenes that go into a crowdfunding success story. I share all of them with you!
If you do nothing else, work on your pre-launch marketing plan. You’ll thank me later.
5. Offer Real Value to Your Crowd
How would you define a “business?”
I’d say this… a business is when you’re providing value to society in some way and people are willing to pay you MONEY in order to own that value.
They’re willing to pay you in order to use a helpful tool, watch an entertaining movie, or solve some kind of a problem in their life.
I would only give you $100 if I thought that the VALUE you delivered was equivalent to or greater than $100. Usually, the companies that dominate the market provide the most amount of value for the amount of money spent.
Basically, you got to provide real value if you want people to support your crowdfunding campaign. You have to come up with rewards or perks that they want to own.
This also applies to equity crowdfunding campaigns. You need to provide an opportunity that is going to be profitable for an investor. They have to be able to see, smell, and taste the vision that you have for your company.
Otherwise, they’re not going to buy into the campaign, no matter how much fancy marketing you slapped on.
Overall, I can’t help you make a great product. I can’t tell which team members you should hire. But, I can show you a proven plan that will get you funding and exposure. Enjoy!
