SMB Tips for Successfully Launching Your Crowdfunding Campaign

Crowdfunding is a way to involve a community of like-minded investors in your startup’s success without taking huge financial risks.

You can introduce your ideas to the business world, straight from the horse’s mouth (that’s you).

Since your ideas are unique and bold, putting them out there is a risk. What if someone likes them a little too much and decides to copy you? Once you introduce your ideas to the world, you’ll have to move quickly before you get ripped off to ensure you remain one of a kind. This means you need a successful launch of your campaign.

Crowdfunding is a direct way to reach potential supporters without having to spend too much. But it will require work. And work without guaranteed pay is a huge turnoff for many business owners.

So how can you know if crowdfunding is the right way to go for your startup? Once you understand the different types of crowdfunding (reward, equity, or debt) and the pros and cons, you’ll be able to make an informed decision. Here are some crucial things to consider before launching off.

Pre-Launch Promoting

While you’re trying to attract attention to your ideas, you’re going to have to invest a hefty amount of time, thought, and work in promoting your crowdfunding campaign. This is not a project where you post a plea and sit back, watching the cash stack up. You’ll have to be active, or else hire someone who can be.

You have to market it hard so you can take full advantage of your campaign’s limited timeframe. There will almost always be a time restriction on crowdfunding campaigns. Use this to your advantage. The squeeze builds excitement around your business and allows you to hit hard in terms of marketing and exposure.

Just make sure you’re fully prepared before releasing too much information. Once you’ve got your full arsenal for promoting your campaign, you’re ready for action. This includes priming potential contributors or investors before actually starting your campaign.

In terms of shaping your campaign, you’ll need a sturdy, motivating message, incentives to draw potential contributors or investors in and keep them around, and a lot of publicity.

Crafting Your Message

When creating your crowdfunding pitch, you get to express the passion behind your business plan. How exciting is that? You’re able to get personal and descriptive in order to relate to investors and fully justify your ideas.

This is likely the first impression your company will make to the business world, so make it count. This is an opportunity to produce a message that illustrates the necessity and innovativeness of your project.

It’s important to give your potential investors all the information about your end goal, about how your business is unique and beneficial to the community and other businesses (i.e. your investors), and how you plan to use the money.

After all, crowdfunding should be used responsibly. The investments you gain have to be seen as a boost to kickoff (hence, “Kickstarter”) your startup.

What I mean is, you should have a plan in mind that ensures your company’s independence after reaching your crowdfunding goal. And investors will be looking for your ability to think ahead.

Really, you’re sending more than one message: the literal message about your business and the one that proves it’s worth it — that you have an idea and a plan to keep it going. Otherwise, why invest? What goes up must come down, unless you can also fly solo.

What medium should you use for your message? Well, anything can look good on paper. Even better, a picture says a thousand words. But a video can incorporate music, faces, graphs, plans, you name it, all working together to dig into emotions and interests of your potential contributors. Creating a video makes it easier for you to get your message across and makes interested parties more likely to pay attention.

Incentives

Investors do their job for a reason. Yes, they invest. Which means they believe in your cause and expect something to come out of it. Your business therefore has to display some sort of benefit for others in the community.

Whether you’re granted a large or small sum, it makes a difference. At the very least, you should acknowledge any support you get. This can be done with rewards, whether tangible (prizes) or intangible (shout outs on social media).

Once people start to see their friends, family, or other businesses being praised for their contributions, they will feel more inclined to participate.

Enter contributors in a raffle to build more incentive. This can be done using social media in order to gain attention.

If your incentives are exciting enough, investors may think you’re doing them a favor and forget they’re even helping you. Probably not, but you can try.

Popular Crowdfunding Sites

Understand that crowdfunding is not always free. Many platforms take a chunk out of your earnings (or even lack of earnings).

All platforms are different in terms of service charge, reward, or promise. Some sites allow you to keep whatever you make, regardless of achieving your goal; whereas, others may charge you more for missing the mark.

GoFundMe and Kickstarter are big names in reward crowdfunding. AngelList is a platform gaining popularity that is free for startups. These are only a couple options within the vast spectrum of crowdfunding platforms.

Whatever your choice, do some research to understand the pros and cons of each platform in order to make the best profit in the end, with the least hassle.