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5 Tips to Running a Successful Crowdfunding Campaign

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5 Tips to Running a Successful Crowdfunding Campaign

By Startup Valley (515 words)
Posted in Startups on October 22, 2013

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Crowdfunding is a tool that helps businesses raise startup funds to begin selling new products or services. During 2012, supporters contributed about $2.7 billion to campaigns of this type. The unity and power of the crowd made it possible for many entrepreneurs to create apparel, books, gadgets, video games and other goods. However, your pitch must be strong prior to submitting your campaign on a crowdfunding portal, like StartupValley. Consider the following criteria in order to craft an effective campaign plan.

1. Examine similar campaigns that have succeeded or failed in the past. Take the time to compile a list of fundraising techniques that have helped other entrepreneurs obtain business funds, in a short amount of time. To identify the most fruitful marketing tactics, do your research to see how these startups promoted their campaigns. Think about the most compelling words and phrases that successful companies used in their campaign pitches.

2. Supply potential supporters with detailed facts about your project and the people behind it. Carefully proofread the text to assure readers of your competence. Be sure to add appealing photos and even consider making a video. Crowdfunding analysts estimate that campaigns with videos are 50 to 114 percent more successful. To gain credibility, provide links to your website, blog, and social media pages.

3. Give yourself plenty of time. Internet marketing usually requires extensive research and communication. Crowdfunding campaigns tend to raise more money when they last about four to six weeks. Regardless of your campaign's duration, it's crucial to find the first few supporters quickly. People are more likely to purchase a product in a store if they see other customers buying it. The same principle applies to crowdfunding. Studies have shown companies are more likely to successfully fund when they have 30%-40% of their goal right out of the gate.

4. Build relationships with potential supporters before your campaign begins. You may accomplish this by using social networks, creating an email newsletter or joining discussions on a relevant forum. Offer thoughtful advice that demonstrates your expertise. Internet acquaintances may contribute to your campaign if they believe that you are an upstanding professional with a long-term online presence.

5. Think about the future when you set a fundraising goal. The target must be realistic, but it also needs to cover most of your initial costs. Startups achieve greater success when they raise enough cash to compensate for a few unexpected problems or mistakes. For example, an essential piece of equipment might fail and need expensive repairs. Remember to tell contributors how you plan to spend the money.

It is also vital to offer rewards that will appeal to your supporters. Many startups choose to ship merchandise or other items to people when they contribute substantial amounts of money.

Follow StartupValley on Facebook for daily posts about the company, the industry, and other interesting entrepreneurial tips!

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