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The Complete A-Z of Crowdfunding

05.21.2013
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A short while back we wrote The Complete A-Z of Crowdfunding, which received some very positive feedback so we thought hey, why not make it a permanent blog post? Check out our helpful tips below before starting your next crowdfunding campaign:

 


Ask for contributions. Obvious right? Of course it is. This is your call to action, your tool for success, and all it is, is a 3 letter word—just ask. It’s one thing to showcase your campaign and say “Check out my project, isn’t it cool?” It’s a completely different thing to say “Check out my project, isn’t it cool? I’m raising funds to expand my operation, create jobs, and mass market my product. I would love it if you contributed to it, and I’ll give you this awesome knick-knack in return!” Which one do you think will be more likely to receive a contribution?
 
Be creative. We’re bombarded with images, videos, words, ads, products, services, etc. etc. etc. all day, every day. Why are you different? You know you’re different, tell the world why you are. If you’re a musician, write a song about your project and post it on your page (this is no time to be shy my friend). If you can recite the Sumerian alphabet backwards on one leg, well I’m not sure how that will help you with your project, but if it does well then more power to you. Get the attention of your audience, and let them see the real you.
 
Constantly update. In a world where we can log onto Facebook and know exactly what 500 people ate for breakfast, we obviously have a need to be constantly updated. Keep your contributors in mind too. I wouldn’t tell them what you had for breakfast, but be sure to let them know the status of your project, how much you’ve raised, where it’s headed, float some ideas past them (since they are your earliest supporters, their ideas and concerns can be an invaluable tool to correct any sort of design or project flaws before you hit the market) and don’t forget to thank them every step of the way.
 
Do your homework. Know exactly what you are fundraising for, and explain it in your description in as much detail as possible. Your supporters want to know where their contributions are going, so provide a breakdown of how you will use the funds you raise. Also, be sure to know exactly what it will cost to produce your Kudos (rewards for contributors), as well as the cost to ship them. You don’t want to end up losing money on fulfilling your Kudos, even if that means having to slightly raise your goal amount.
 
Expect slow days. Especially towards the middle your campaign. Think of your campaign funding as a U-shape, with the first and last weeks of your campaign getting the most ‘push.’ Don’t let campaign fatigue slow you down, try to dedicate a given amount of time each day to focus on your project. This means talking to your friends about it, emailing people, posting on social media, updating content and your contributors, replying to comments, etc.
 
Fulfill your Kudos. Don’t let down those who believed in you, they were your initial supporters and they expect their Kudos. If there is a problem in production, in shipping, or anywhere else, keep them updated. Don’t leave anyone hanging in the dark, it’s worse to ignore the problem than to tell your supporters that there has been a slight delay in Kudos fulfillment.
 
Get out there. Make yourself visible to anyone and everyone and tell them why you’re fundraising (refer to A). You never know who can end up helping you out, so don’t be shy: tell your family, your friends, your colleagues, that weird guy down the street (well maybe not him), your vet, the cable guy, you get the point. Even if they don’t donate to your project, they may tell someone else about it who will, not to mention all the promoting you’ll be doing if your goal is to build awareness. Start with your primary circle, and work your way out, and this applies to word-of-mouth, utilizing all forms of social media, renting a Cessna with a large banner, whatever works for you.
 
Have fun. You can make a game out of it, offer funny Kudos, or set personal goals such as how many people to speak with per day or how much to raise per week. If you’re a dancer, offer a video of yourself doing an interpretive dance as a reward. If you’re a songwriter, offer a personal song dedicated to the person who claims your highest Kudos. Having fun with it will not only prevent campaign fatigue, but also greatly increase your chances of success.
 
Improve your credibility. People want to see the “you” behind the project. Talk about yourself, why you started this project, what your goals are, and how you plan to succeed. Include any relevant images, videos, and spreadsheets that you have. Don’t forget any relevant links for your project as well, such as your website, a Facebook page, your Twitter page, and any other links that will help build your credibility.
 
Jump at the opportunity. When you get a chance to discuss your campaign, do it! If you’re at a social function, a club meeting, standing around by the water cooler pretending to be busy, or hanging out with your pals, mention your project. People won’t contribute to it if they don’t know about it, right? If an opportunity comes up, take advantage of it, because you never know who will be interested.
 
Kudos! Give your supporters the Kudos they deserve, whether it’s through your rewards or simply saying thank you. Be personable and connect with them, they’re not only investing in a project, they’re investing in you. Tell them you appreciate their contributions, whether they’re monetary or helping you spread the word. If you’re offering Kudos rewards, don’t forget to send them out! If you want, take pictures of your team making the Kudos rewards and update them on the progress.
 
Loyalty to your supporters. When your project ends, don’t forget those that were there for you! Whether they donated or told others about your project, they played a role in your success so keep them in mind. Send them loyalty cards, tell them first about upcoming promotions, give them future discounts, etc.
 
Manage your time wisely. Allocate some time every day to promote your project, and decide what would be the most efficient use of that time. Is it emailing people? Utilizing social media? Attending networking events? It may seem like you have a lot of time left until your project ends, but it will require a time commitment to reach your goal.
 
Network before you launch your project. Establish a base of people who not only know you, but also trust you. They’re more likely to contribute, especially in the first weeks of your campaign. They’re also the ones who can help you spread the word to their own connections.
 
One dollar Kudos. Don’t discount the almighty dollar. You can offer a Kudos reward at the $1 level too—even if it’s something as simple as a thank-you email or a feeling of goodwill. Throw it in there, because who knows, those dollars add up.
 
Persuade to donate. Be convincing, personable, and transparent. Who will your project benefit and what type of benefit will it provide? Your audience needs to be convinced that they’re contributing to something they can feel good about, or get a cool reward. Don’t forget, people aren’t only investing in your project; they’re investing in you, so tell them why they should.
 
Quote your supporters. Share with your audience what others have said about your product/service/whatever it is. Provide the quote, and if you would like, the person’s name and title to add credibility. It’s one thing for you to promote your project. It’s another thing if other people are promoting it. Even better if you record it and post the video.
 
Return the favor. Have supporters who contributed to your project with their own projects? Then help them out as well. Even if it’s not with a monetary contribution, help them spread the word. Tell your own network about it, and reach out to people who you feel would be interested in their project. Don’t forget, kindness comes around full circle.
 
Secure commitments prior to launch. People are more likely to contribute when they see there are already contributions being made to your project. If you can, get a group of people, whether they’re friends, family, colleagues, etc. who you can count on to make a contribution within a day or two of your launch. That way, when people who you aren’t as close with see you have contributions being made and feel more comfortable contributing themselves.
 
Talk to us. We want your project to be successful too, so if you have any questions, shoot us an email at info@funderhut.com. I promise we’re nice and we’ll be happy to toss around some ideas with you.
 
Understand your competition. If there are projects similar to yours, what makes yours stand out? Is it a catchy title, a cool video, or a photo of your cat (because who doesn’t love cat photos?). The key here is creativity; think of cool Kudos to offer, an engaging story, or an over-the-top marketing strategy. For example, a campaign to raise funds to purchase a hedgehog offered Skype dates with the hedgehog as a reward. Have fun with it.
 
Vary your outreach. If your project is creative, reach out to the Pinterest community. If your project is professional, reach out to the LinkedIn community. If it’s medical, post on medical boards. Don’t limit yourself to only Facebook. Give out cards that detail your project to your yoga class or at your next social function. Shout it from a mountaintop if you have to; just find the outlet that works best for you.
 
Who, what, when, where, why, how. Who benefits from your project? What is it for? When will it be complete? Where will it be located? Why are you raising funds? How will you spend the funds?
 
Xecute your strategy. That’s right; we just used X on a word that starts with E, because xylophone and x-ray just don’t make much sense here. Your strategy can be divided into three parts: Pre-campaign, campaign, and post-campaign. In your pre-campaign stage, plan every bit of information that you will present to your audience. Why are you fundraising? Why that amount? Who will you reach out to? How much time will you dedicate to it? During your campaign stage, you execute and modify your strategy. See what works for you and focus your efforts on that. Talk to people, market your project, and make yourself visible. Now for your post-campaign, it doesn’t stop once you receive the funds. Fulfill your Kudos, thank your contributors, and stay in touch with supporters. They believed in you before, and they have a good chance of becoming customers after.
 
Your video. Keep it clear, concise, and personal. People are visual beings, sum up your project as best you can in your video. Show the person behind the project, and engage with your audience. Establish a positive connection between yourself, your project, and your audience. The important thing is to be yourself. Unless you’re a jerk, then act nice. Explain your project, and if you’re offering Kudos, show them off as well.
 
Zero in on the small details. Step outside of the role of project creator and into the shoes of your audience. Or sandals for those in the warm places. What questions do you think they would have for you? If something is unclear, well, simply put, make it clear. Scan your project from the point of view of an outsider, and include the relevant details that will make your audience understand both you and your project better.

Republished with permission  from the FunderHut blog.
Published at DZone with permission of its author, Dan Salganik.

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