One of the most tricky steps that an entrepreneur will eventually face is the capital needed either to prototype or launch his project. Technology and its rapid evolution provided a variety of e-solutions for this task. Its most successful contribution though was the evolutionary act of Crowdfunding. Crowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the internet. In simpler words it is an innovative way to multiply your funders and your money, while at the same time advertising and creating impatience for the creation of your prototype.
Although crowdfunding is a highly evolutionary and helpful act for new entrepreneurs, requires a variety of prerequisites you need to meet in order to secure your fund and continue to the production stage. For this reason there exist specific tips in order to achieve the business objectives of your start up.
Launching a crowdfunding campaign, can be divided into 5 steps:
Step 1: Share your story
Beginning with, you need to fully inform your potential funders know on what are you working on and how this project can benefit them. Share who you are, your background and your personal objectives. In combination with your R&D (Research and development), you need a powerful personal branding strategy. Your funders do not only fund a project but they also fund a colleague. Communicate your project using visual imagery and make sure that your linguistic, semantics and semiotics are of great balance and detail. Ensure that your video is highly professional and clearly defines your USP (unique selling proposition).
Step 2: Be fully aware of the rewarding system
It is ok to promise to you pledgers big rewards, but you should never forget that you need always to promise what you can deliver. For these reasons your promises should be SMART, ie. Specific, Measurable, Attainable, Realistic,Time Framed. One tip that could be found really helpful is the practice of under-promise/over-deliver. When communicating your projections you need to promise a bit lower than the accurate ones. At the time of the delivery you will eventually deliver more than you have promised.
Step 3: Set a funding goal
Most of the crowdfunding platforms have adopted an all or nothing mentality. If you don’t meet or exceed your funding goal, you get nothing. However there are other platforms such as Indiegogo that allows you to keep the money. No matter what the case is when setting your funding goal you need to be really careful and try to make accurate projections. Again in this part of your crowdfunding you need to act in a SMART way, as mentioned before.
Step 4: Promotion
There are many different ways to make people aware of your crowdfunding campaign. Here are several tips for getting the word out there:
* Utilize social media to spread the message.
* Reach out to the media and bloggers to get coverage for your campaign.
* Host a live event to drive up interest and engagement.
Keep in mind that your campaign is unlikely to succeed without a 100 percent commitment on your part. You need to think of it as a your full-time job while you’re driving toward your campaign goals. Leverage every relationship and marketing channel available to you.
Step 5: Fulfill your promise
Your responsibility as an entrepreneur does not end when reaching your funding goals. The campaign and your responsibility ends when the perks or rewards are paid to every single pledger. Only when fulfillment is completed you can only say that your campaign is finished. Till then there are a lot of things in the air for you and your backers, and they are of managerial handling.
Remember, your backers are your No1 priority. You need to constantly show them that you care in order to support your campaign and reach out to their friends and relatives to back you up. A good way to be sure that you have understood the will of your backer is the use of SARAH model (Chris Duffy). When they address to you in any way, you need to Stop talking, Active listening, Reflect (which means to repeat their words), Ask and finally Handle the situation.