Crowdfunding: You’re not doing it right

While crowdfunding is a great way to take a good idea that lacks initial funding and make it successful, it is also used for many other things. Since its introduction, crowdfunding has been interpreted by some as a way for people to give you money without getting anything in return. Granted, the rewards on some crowdfunding campaigns can seem a bit esoteric, but if the campaign is successful it means those things had value to the contributors.

Consistent marketing is key

Several years ago, I was asked to help with a crowdfunding campaign for a local non-profit. They were trying to raise $25k on a deadline with only about 2 months’ leeway. I knew this was not much time, but I looked over the proposal anyway. One of the first things I noticed was that their organization’s website was terrible.

Marketing is (or should be) a coordinated effort. If you have brilliant business cards that send people to your abysmal website, you cannot blame the business card designer for your lack of success. All of your marketing efforts should work toward the same goal.

I offered to build (for free) a website for the non-profit to help ensure the success of their crowdfunding campaign, but they were hesitant. Time was passing by, and I eventually told them that I didn’t think there was enough time to successfully run their campaign. (There hadn’t been from the start.) I offered to give them the IndieGoGo campaign I had already set up for them, but they didn’t respond. They ran the campaign themselves and raised $300 of their $25k goal.

What’s in it for me?

While it would be lovely to think that everyone in the world is a charitable person, just waiting to throw money at your cause, most people would like to get something in return for helping you reach a monetary goal. Therefore, the rewards for your crowdfunding campaign are very important.

If you sell a product, clearly your contributors are going to want to receive that product for contributing at a certain level. Many businesses use their campaign to fund the development of their initial manufacturing process. By offering the finished products as a reward, they are essentially pre-selling the products they have yet the capacity to make. I think this makes perfect sense, and I love supporting these campaigns.

I recently saw on Facebook that a business I’m familiar with is having financial troubles. They have started a fundraising campaign on IndieGoGo to try to raise money to save the business. The business sells a delicious food item. They are trying to raise $50k, which is quite a lot of money. I read through the short narrative on the campaign and knew it would fail.

How did I know?

• First, the campaign does not say what the money is for. As a contributor, would you blindly give money to someone without knowing how it will be used? Always, always spell out specifically where the funds from your campaign will go. (Example: $20k for 6 months of rent, $10k for cooking supplies, $10k for salaries, $5k for utilities, $5k working capital cushion)
• Second, there is no website link. There is a Facebook link, but a website link legitimizes your business or cause to a greater degree.
• Third, there are no rewards whatsoever on this campaign. They could easily offer some of their delicious product for contributions far above what it takes to make them. A lack of rewards is a sure way to doom a campaign. Even a “thank you” for a small contribution makes someone feel all warm and fuzzy inside.
• Fourth, the campaign does not tell me how giving them $50k will help make the business sustainable. After the $50k is spent, will they be in trouble again? People want to donate to causes that result in lasting success.

Non-business campaigns

As you’ve probably seen, there are many non-business crowdfunding campaigns. Most are on sites like GoFundMe or other less popular services. Many ask you to donate to families or individuals who have experienced tragedies. Others are for community projects. But they still have the same element in common: you have to convince people that your cause is worthy enough for them to part with their cash.

Tragedy-related campaigns are usually driven by friends and family and are fairly successful if you have a big social network. But if you are a tenacious teen trying to raise money to go on a road trip with your buddy, you’re going to have to convince people to fund you. You’ll have to follow all the rules I listed above, plus be a great writer, and include photos, maps and images.

Most people live on some sort of a budget and cannot even donate to all the charities they’d like to. (The incessant emails will never end!) Creativity and linguistic skill are required to build a first-class campaign that gets fully funded. That, along with making sure all your various marketing efforts are equally up to par, will go the farthest toward guaranteeing your success.