There are times when you come up with a brilliant idea that will surely be revolutionary. Everything’s all set. The only problem is money. How do you raise the necessary funds so your idea can take off and become a reality? What if banks and lending agencies do not approve your loan? Where will you go so you can get the funds that you need? In this post, we will explore crowdfunding and how this can help you in making your vision come to life.
Social media is an important factor when it comes to crowdfunding. You may be wondering how this is possible at all. Aren’t social media network only for posting photos and getting in touch with friends? Not anymore. It has become more powerful than that. It has changed the way we do business, how we market, and how we raise capital.
Social media is not limited to Facebook, Instagram, and Pinterest. There are many social media platforms that are crowdfunding websites. But what are these crowdfunding websites? These websites are what connects hopeful entrepreneurs to generous investors. Not only that, you get to connect with contributors, patrons, and producers, too.
Crowdfunding has the same idea as that of crowdsourcing. With these two, a person gets to have an open call towards a crowd or a large group of people. With crowdsourcing, tasks can be outsourced to this crowd. With crowdfunding, funds can come from these group of people through an open call. Through this online community, projects, causes, and businesses can be funded.
How It Works
The rules are different from one site to the next. In general, people, charities, or businesses get to pitch their ideas and set a goal for their fundraising, as well as deadline. After that, the potential patrons review the ideas and pitches so they can decide and choose which among the pitches they would want to support.
In crowdfunding sites, people do not invest in the business or project, what they do is that they fund it. If the business becomes prosperous, they get to be rewarded. However, it remains as a business that the entrepreneur owns. Patrons do not get to own any part of the project or business. This is because of the US regulations that are for now being reviewed by the SEC. But this may have some changes in the future.
For each of these crowdfunding sites, there are different rules, most especially the sites that are located outside of the US. That is why it is important that you take the time to read the terms and conditions.
How to Start Your Campaign
Your crowdfunding campaign begins with a pitch. With your pitch, you get to describe what your project is about. For example, if your project’s aim is to help veterans with their VA mortgage rates for their homes, you have to be very specific and very detailed about how you are going to help them and who among the veterans you will help. Also, with your pitch, you can describe in detail the rewards that the patrons may receive if the fundraising turns out to be successful. You can then create a timeline and a funding goal.
Choosing Your CrowdFunding Site
It makes a difference which site you choose to launch your campaign. For each crowdfunding site, they have a specific audience. There are those for creative people, there are some for the entrepreneurial crowd, and there are those that are socially bent. Non-profit organizations can also take advantage of crowdfunding sites. You have to know and understand the focus of your project so that you will also know on which site you are going to launch your crowdfunding campaign.
Knowing Your Target Audience
Once you are already clear about your project and you have chosen your site, focus now on the audience. Most of the projects that have been successful focused on a narrow and specific audience. You can focus on the audience based on religious nature, geographic area, or common background. You can also consider common interests such as books, movies, and music. When you know how to target your audience, your chances of being successful in your crowdfunding campaign will be much higher.
The internet is a fast-paced world. Your campaign can get left behind if you do not actively attend to it throughout the whole duration of the campaign. Have emails ready for the beginning, the middle, as well as the end of the project to make sure that it remains active. If the project immediately takes off, you may be overwhelmed with so many emails that you have to respond to. So to do this, prepare a FAQ-type of email so you have something to send those who are inquiring about your project.
You have to believe in your project and how it can help the people you want to reach. If you want to send school supplies to third-world schools, show the crowd why they need your help and how much their help can affect the lives of the school children. You have to be passionate about your cause and be the number one believer that you can make it happen. Passion is contagious. If people can see how devoted you are with your project and how sincere you are, they can be more convinced that it is worth their while to contribute funds to your projects.
These tips are just among the things that you can do to ensure a successful crowdfunding campaign. You have to be very passionate about what you do and convince the crowd that indeed, your project is worth funding. You have to be able to share your vision with the crowd so they can see that your project is worthwhile.