Improving Your Chances of Getting the Capital You Need
The internet and social marketing have spawned untold new ways to help people turn dreams into reality. One of the most tangible, perhaps, is the concept of “crowd-funding,” where individuals and entrepreneurs appeal directly to the general public for financial backing or support. The concept isn’t entirely new—a similar approach was used 150 years ago to solicit donations to build the pedestal for the Statue of Liberty—but the internet has considerably streamlined the process.
What are the keys to mounting a successful crowd-funding campaign? What can you personally do to maximize the chances of reaching or exceeding your goals?
Step #1—Craft your story
Before you ask for a dollar, you need to carefully develop a narrative, one that inspires people to be a part of your vision. Facts can be helpful, but the better stories are the ones that affect people at a deeper level. Understand what moves your potential donors and fashion a story that will touch and inspire them, that will make them want to be a part of your enterprise.
One of the important components of an effective story is detail. Be specific about how much you want to raise and what you plan to do with it. Make certain that your numbers, including goals, expenses and potential revenues, are realistic and supportable.
Step #2—Make a professional video
Statistics consistently show that crowd-funding campaigns with polished video presentations raise far more money than appeals made through other means. You took the time to craft a powerful story…take the time to make certain your story is well-told. In fact, before you ask for any money, carefully examine your whole campaign to ensure that it presents a professional image. Any perceived lack of professionalism can kill your credibility.
Step #3—Start with the people you know
Before you kick off the campaign, take the time to identify a number of key backers, people with both visibility and capital. Studies show that the crowd-funding campaigns that are most successful usually get about a third of their targeted donation in the first seven days. Furthermore, it’s common to approach those donors privately. Then, when you open the campaign to the public, you’ll have immediate credibility and interest.
Step #4—Offer people a reward to contributing to your vision
Even when you have such a great story that people just want to be a part of it, offering some type of perk can dramatically increase your likelihood of success. It may be discounts on a product or service or it may be cool swag (which can also be a great form of advertising).
