By Rivka Willick
It’s hard to believe that Crowd Funding has only been around for a little over five years. Kickstarter, the superstar of crowd funding sites launched on April 28, 2009 and set off the internet trend of raising money through online campaigns. The first crowd-sourcers focused on innovations and artistic projects. Some projects are modest, like a pre-school teacher seeking funds for art materials for Jackson Pollack-like canvases. Others are large and ambitious such as funding for a film or complex video game. Other platforms soon followed offering charities, individuals in need, entrepreneurs, inventors, and just about anybody with a project a place to pitch their need or idea.
Here’s how crowd funding works. A person posts a project and asks the public for financial support. Some sites, like Kickstarter, require the poster to meet their stated goal, if they don’t raise enough money, they don’t get any. Other sites like Indiegogo and Rockethub allows you to keep the money you raise (minus their fees) even if you don’t reach your goal.
Sounds great…and it is for some, but many people set up projects and raise little if any money. There are some wildly successful campaigns; The Veronica Mars Movie Project raised $5,702,152 and Star Citizen Video Game raised $68,549,471 on Kickstarter and Ubuntu Edge a “high concept” smartphone raised $12,814,196 on Indiegogo. Unfortunately most crowdfunding campaigns fail.
Robert Strohmeyer reported in PC World Sept 26, 2013 that only 44 percent of Kickstarter projects and 34 percent of Indiegogo projects meet their goals. Those are sobering statistics, but I haven’t found any stats that examine the success rates of projects that do the ground work and launch with proper preparation and those that don’t. If you do the ground WORK, and I really do mean work, your chances for success will greatly improve.
Improve your chances for Crowd Funding Success.
- Research and choose the platform that fits your project. There are dozens of crowdsourcing sites and the biggest is often not the best. Some crowdsources (like Kickstarter) will only give the funds if you meet your goal. That makes sense if you can’t do the project without the set amount AND you have no other means of getting the balance. Other sites will release the funds raised even if you don’t reach your goal, but they will often take a higher percentage.
Each platform attracts different groups of backers. If you have an innovative business project you’ll probably want to pass on Kickstarter and Indiegogo because neither have a category for business innovation or ideas. Rocket Hub does. There are platforms that appeal to specific groups or causes like Jewcer (Jewish Projects), help individuals and organizations raise money for a cause like FundRazr, and match projects to investors (not supporters) like Onevest.
- Tell a Compelling Story – Most projects post a short video and have a brief write up, so you need to connect with possible supporters in less than 3 minutes. As a storycoach I can help you find and form your story and write it up as video script. Remember, just because you think your product or idea is great doesn’t mean anybody else does. You’ve been developing and dreaming about it for a long time, others haven’t gone through that process. You must share your enthusiasm and concept in a compelling way—Story is the most powerful and effective means of communicating and connecting on both an intellectual and emotional level.
Your video story can be told with images and music, animation, or verbally. I’ll be happy to work with you to find a format that will fit your project.
- Create Your Own Crowd before the Project Launches – Update your email list and contact friends, family, and fans. Get active on social media and let people know. Blog about it, pass out flyers at networking events, tack a flyer about it on the company cork board, talk about it when you do presentations, mention it at parties, and talk about the project on your website. THIS IS ESSENTIAL. You won’t attract strangers if your friends and fans don’t care. Early and continual funding keeps projects high up on many platforms. It also draws attention. After all, it’s only human nature to be curious in success.
- Create an Exciting List of Donor Gift Categories – We all like stuff. It’s fun to be part of art, innovation, or exciting ideas, but it’s even more fun when you get something out of it. It’s a good idea to set up low, medium, and high price gift categories. The perks vary each project , try to tie them to your story. If you are offering products, make sure you have the ability of deliver them In a timely way. For example, if you’re raising money for a new fashion line and you are offering items from the line as perks, make sure you’ll have the manufacturing capacity and capital to deliver each item in the time frame you post.
- Be willing to commit real time and some money to make the campaign a success.
If you’d like to find your story and create a compelling video script for your next crowd sourcing campaign, drop me an email and ask about my crowd sourcing package. Rivka@simplyextraordinarytales.com