Crowdfunding is increasingly becoming the most popular way to raise funds for and promote the
brand name of a new business ventures. The success stories of budding entrepreneurs starting
several successful business ventures by raising funds from crowd funding websites like
Kickstarter, ProFounder and RocketHub are manifold. However, not all businesses started with
crowd funding have been successful. The success of a business venture through crowd funding
depends on its campaign. And the success of a particular campaign depends on certain dos and
don’ts which are given below.
Do: The Math Correctly
Many entrepreneurs make the mistake of just calculating the startup costs of the business and
asking pitching for funds on crowd funding websites. A business would require more than
startup funds to reach its goals. It would incur additional costs in the form of service fees,
shipping charges and several other hidden costs that one needs to be pretty sure about before
starting a campaign on a crowd funding website. If not, chances are the entrepreneur would be
faced with the dilemma of pulling in additional money from other external sources; a move that
could seriously hinder the progress of the business and its campaign on the crowd funding
websites.
Do: Make a Simple Campaign with a Video
Cluttering a campaign page with too much detail and too many designs can leave visitors
confused and apprehensive of investing money in the corresponding business. A simple
campaign page with a little bit of precise information about the business, its goals and objectives,
and its progress so far would be more than enough to attract potential investors.
Actions speak louder than words. And videos reach out to target audiences better than messages.
Placing a small, but crisp video about the business on the campaign page would definitely attract
investors. In fact, several crowd funding websites note that campaigns with videos usually raise
more funds than those without videos.
Don’t: Rest once the Campaign Starts
Starting a campaign and then just leaving it at that would do no good for business. No one would
invest in a business until they are assured of its potential to become a success. A smart
entrepreneur would not rest after his campaign starts, but would work in full swing to spread the
word about the same. He would link the campaign to his profiles in other social media networks,
and would make sure that everyone who knows him, knows his campaign as well. And that
would just be a small step in the endeavor to attract strangers to the campaign as well.
Don’t: Expect to reach the Target (Funds) at once
Many entrepreneurs believe that starting a campaign in a crowd funding website would enable
them to get all the money they need for the business to run. That is a very wrong notion as there
is no way a campaign would raise the funds for the business at once.
Entrepreneurs would have to plan with available funds (raised at that moment) and work
accordingly, starting the business first and then developing it as more funds arrive. They should
also work on creating multiple campaigns to keep the cash inflow steady so that the business
does not meet any roadblocks in terms of funds.
Don’t: Forget Rewards
Investors would feel happier and more eager to invest in campaigns that offer them rewards in
return. The rewards don’t need to be expensive gifts, but can vary according to the size of the
donation. For instance, while a small investor can get free movie tickets as rewards, bigger
investors can get free meals at standard restaurants around the city.