Crowdfunding has propelled a considerable amount of businesses into success by enabling the power of the crowd
There are a number of factors that play a part in a successful crowdfunding campaign:
- The zeal of the project creators
- The actual value of the business proposition
- The worth that potential funders place on it
- The platform
Depending on the nature of your campaign there are an assortment of crowdfunding platforms to choose from. When done well, crowdfunding is an experience that can not only provide you with a significant amount of funds to help develop and build upon your business idea but it gives you market validation by letting you know that people are interested and are willing to support you. With that said it is fundamental to mention that a lot goes into building a successful crowdfunding campaign, but the benefits are profound!
Before you jump on to any crowdfunding platform, you should ask yourself a few questions to ensure that you are certain of your choice, luckily I’ve assembled a list of 5 as a starting point.
Who are you?
Arguably the most philosophical question out there, but really who are you? Your crowdfunding campaign will be an extension of your goals, ideas and values. If you want to be able to convince potential funders that you are someone worth supporting you have to ensure that you are portraying yourself as that. What does this have to do with the platform? You would need a platform that has features that can demonstrate this. A majority of crowdfunding platforms inexplicably cater to specific types of projects. For instance there are those that only accept projects in themes such as creative arts, community, real estate, biotech and then there are those catered for social good products or ideas. If your project fits into a category, it would be best to identify a platform that is congruent. The reason for this being that the traffic that is generated on a crowdfunding platform would usually derive from users that are interested and supportive of the overall ethos of their featured campaigns. Also, the skills and expertise offered by the platform will most likely be relevant to that particular industry.
If you are aiming for your campaign to be a success you need to know that it is not a simple process. There is a common misconception that once your project goes live on a platform, a hoard of people will instantly appear and unload their wallets and purses. Unfortunately, that is not actually the case. You want to be sure that the platform you decide on gives you as much support as possible to help ensure that your campaign is a success. Good support offers guidance on creating marketing plans unique to your business, regular catch-up calls with a crowdfunding expert and access to a network of professionals from videographers, graphic designers and a advisory board – this combination helps maximise the likelihood of your campaign being a success.
Which funding model do you want to apply?
This is one of the most important choices to make when deciding on a crowdfunding platform. There are four main funding models:
- Equity, this is where those who fund you get a stake in your company in return.
- Peer-to-Peer Lending, whereby the funds that are invested are repaid over a period of time.
- Donation, where the funds are donated for a charitable cause.
- Rewards – Based, where funders receive a tangible gift or service in return for their contribution. It is essential that you are aware of the funding model of the platform you decide on.
The success rate of former projects
This might just be the elephant in the room, but it has to be addressed. Although many platforms have had a plethora of projects featured on their websites, what really matters is the amount of the aforementioned projects that have actually met their funding goal. This works in conjunction with support. If your crowdfunding platform does as much as it can to aid you, the more likely you are to succeed.
What technical features does your crowdfunding platform offer to ensure the efficiency of your campaign? In a technical capacity, there are many things that can be done by a crowdfunding platform to help your campaign. Do they configure shipping costs (mainly applicable to a rewards based model)? Do they offer a section outlining the steps of the crowdfunding process?
Technical features are like the cherry on top for a crowdfunding campaign – funders want to be assured that the process will be stress free and will run smoothly. I assume that you would also want a simplified process where most of the not so thrilling parts are taken care of too.
The final call
The growth of crowdfunding has been immense and is projected to raise over $90billion by 2025. There has been an emergence of crowdfunding platforms, each offering to help those with different ideas and niches. Hence being why it is key to find a platform that aligns with your mission and aims. Crowdfunding for social good products accounts for 30% of the overall market. It has helped better the lives of many people, and contributed to the solutions of a number of humanitarian issues.
If you have a high-impact idea with a strong team, vision and understanding of your output metrics, consider HelpingB – a platform specifically for campaigns launching social good product addressing today’s greatest challenges.