An Introduction to Crowd Funding

Monday, May 18th, 2015

Crowd Funding is a process where plenty of people on the internet donates small amount of money for a cause or a project and raise a large sum of money.

While this sounds similar to e-begging but in reality, the concept is far from it.

People who support a crowd funding campaign by donating a small amount of money are known as backers. These backers are some of the most helpful people on the net, they support a campaign because they have faith in the creator, and they want to support the idea, innovation and creativity. They are very excited to see the idea take shape of reality.

However, that said – most people only donate money because they expect to receive a perk in return.

In reality, this pretty much makes the whole process as Pre-Ordering something rather than just donating money.

Crowd Funding

Crowd Funding

So, what are the top crowd funding sites?

We will discuss this topic in detail in another post at a later time, however, very quickly – here’s the top three crowd funding websites.

1) Kickstarter – This is the main crowd funding website and if you are from a country supported by Kickstarter – you should definitely give it the top preference.

2) Indiegogo – If kickstarter isn’t available in your country or you want to use the flexible funding option then indiegogo is your best option. Flexible funding means you will get whatever money you raised in your campaign. That way, you will keep the money even if you don’t reach your crowd funding goal.

3) GoFundMe – GoFundMe is the best place for personal crowd funding campaigns that are targeted to raising money for life events and crisis.

There are pretty much an infinite number of crowd funding sites available today and they are all doing great. There are many niche crowd funding sites too. The choices are plenty – but in general, going with a top tier platform is always recommended.

Before you start a crowd funding campaign, here’s a small check list. We will discuss this section too in much detail in a future post.

Crowd Speaking

Crowd Speaking

  1. Work hard on your idea – Generally, as a future entrepreneur when we get an idea, it always sounds golden at first. But most of the time it isn’t. Don’t start directly on the idea before verifying it for public acceptance or chances of getting successful with it. There are ways to find out if an idea is worth the go – without actually starting on it. A targeted market survey or a crowd speaking campaign can be helpful to determine the likelihood of getting successful with the idea.
  2. Build a following – Give yourself at least 6 months of time for preparation. This includes a landing page, a mailing list, an auto responder series, social profiles and updates, PPC, social ads and other advertisements, press releases, getting published on major blogs and websites and much more. Even after 6 month’s time, if you feel you aren’t ready – it is best to give yourself more time and keep building an audience that will be the first of your backers.
  3. Plan your Perks – Give it some time and think on it. Most people will support your campaign for perks, but they don’t want t-shirts or coffee mugs. They want something related to your project or campaign. Perhaps some limited edition products and early bird offers related to your campaign.
  4. Get a video – This is a must have, however rather spending a big amount of money on it – it is preferable that you get the video done by yourself. That way your supporters will have more faith on you.
  5. Add images – Images are great for presentation and it will keep visitors glued to your campaign. However, that is only part of the reason why we recommend images – as the main reason is marketing. We helped a campaign to reach over $2000+ in funding because of their catchy images alone. Images are very easy to market over the social media.
  6. Your campaign content matters – It is best to hire a professional copywriter to write the campaign text. Along with that, perhaps opting for infographics for the perks, product descriptions and stretch goals isn’t a bad idea either.

This is just the bare minimum to get started. However, if you are on the technology or the design niche with a great product and you do the above properly, you are pretty much set for a good campaign.

How to market your campaign once it is running?

Promote

Promote

This is the most difficult time for a campaign creator. Your campaign runs from one to two months time – and you need to make every day count. Of course the first day matters the most, if you manage to get some quick support on the first day, or the first few days – then chances are that kickstarter might make it a featured campaign, also known as – “Staff Pick”. This alone will give you a huge boost and the campaign might start to trend on the category pages or the homepage. Your campaign can even be included in the kickstarter or indiegogo newsletter which is the ultimate highway for the backers.

Utilize your time properly; you need to make progress every single day. Join crowd funding forums. Hangout where the backers are. Try to get published on various blogs and online magazines. Press release is important too, as it is a quick way to get into the news search. We have included an optional press release feature on our packages too, which also includes getting published on news blogs.

Do understand that even with all this marketing, you can’t avoid the kickstarter slump. There will come a time in the campaign when the progress will seem to be very slow. But don’t give up – keep the hard work going and you will see a better end result.

Campaign Ends! Now what?

If you failed to reach your target on kickstarter – you won’t get any money. But you do gain plenty of experience which you can use next time. On indiegogo however, if you have selected flexible funding, you will get whatever funds that you have managed to raise. This can be tricky though, as the backers will expect their perks and it is your responsibility to deliver it.

If your campaign is a success then you have already managed all the funds that you were looking for. Don’t waste your time in celebration though and work over time to deliver the perks in time.

Hey, am - the CEO and Founder of the Guest Crew Influencer Marketing Community and a full time Blogger. Follow me on Twitter, Linkedin and Facebook.


9 responses to “An Introduction to Crowd Funding”

  1. Sunday says:

    Indeed, this is an introduction to Crowd Funding. It sure is worth trying if one needs to promote an idea.

    From what I have gathered from this post, creating value through the idea is readily what would attract backers.

    The campaign promotion is not a child’s play and it sure would be important to put in the best at all times to attract the right investors!

    This comment was left in kingged.com

    • Uttoran Sen says:

      Hi Sunday,

      thank you for the comment, glad you liked the article,

      This is pretty much an introduction, will get into much more details in the future posts. We have helped raised several hundred thousand dollars for various clients via. crowd funding so far … there’s plenty of information to share,

      thanks,
      Uttoran Sen,

  2. Samir says:

    Great post, well I must say I have got a clear idea about crowd funding from this post itself.

    Thanks for sharing.

  3. Mark
    Twitter:
    says:

    What an awesome step by step tutorial Uttoran!

    While I had heard the term “Crowd Funding” here and there,
    I really had no clue how they really worked and or what th actual
    benefits were from doing one!

    Thanks for my eyes to the possibilities!
    Mark recently posted…How Extremely Savvy Entrepreneurs Know When It’s Exactly The Right Time To Start Rocking A Business!My Profile

  4. Martin Eno
    Twitter:
    says:

    This article is very informative because it points out the differences between the various crowdfunding platforms.
    Before you select a platform to use for your campaign, you should do your due deligence.
    Make sure you pick a platform that suits your objectives.

  5. Max West says:

    Thank you for sharing. I’m learning everything I can about Kickstarter and crowdfunding; I’ve even gone as far as to write notes in a notebook!

  6. Hey Uttoran, Informative post indeed.

    So glad to know about Crowd Funding because you have informed very well on this topic. It’s the best way to donate a small amount of money. I was really unaware before about Kickstarter, Indiegogo and GoFundMe and sites are really perfect destination for crowd funding.

    Reading this post, I have learned one new and interesting thing, that is : how to run and market campaign which is one of the great achievement reading this post for me. I know promoting a campaign is not an easy for everyone but it can be tried by following things which is instructed and defined in your post.

    It was easy to know better for me about how crowd speaking works by just going through info-graphic. Thanks a lot for sharing such wonderful post. 🙂

    Have a good day 🙂
    – Ravi.

  7. coupon yatra says:

    Great Article on crowdfunding

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