There’s no denying it, crowdfunding is the next big thing for businesses. Here are our ten top tips to help you develop your crowdfunding pitch.
Everyone from the likes of Hugh Fearnley-Whittingstal to Danny Baker are bypassing the banks to get finance from people who actually ‘give a damn’ about what they’re doing. It’s not the odd fiver that’s changing hands either, between 2009 and 2014, the crowdfunding website Kickstarter reported that more than £1bn had been raised in global funds.
Here are our top ten tips to get you off to a flying start.
1) Decide what you want to fund
You need finance. That alone is not a good enough reason for the public to open their wallets and give you access to their hard-earned cash. You need a specific project: are you building a brewery, launching a product or organising a new event?
2) Calculate how much you need
When you know what you want to fund, you need to work out how much it’ll cost. It’s all basic business plan stuff, but you need to think of your crowd funders as you would the like of Debra Meaden and co. in Dragons Den. Numbers matter!
3) Develop your key messages
People need a reason to give. They need to know that the project will have benefits beyond merely lining your pockets. They need to see that your project is making a difference in some way or other to their lives or the wider world.
So, are you solving a problem, fighting a cause, championing an issue or simply bringing joy to the world? Develop your key messaging with the bigger benefits in mind.
4) Create a strong brand identity
Your campaign message and imagery need to reflect your own brand. If there’s a disconnect, people won’t trust you. You also want to stand out from the crowd and make sure that people know instantly what you’re all about. As someone must have said, ‘Firm foundations build great campaigns.’
5) Create incentives for your investors
Whilst crowdfunding is music to the ears of businesses, it’s still a business transaction, not a blank cheque. You need to give your investors something back and that ‘something’ needs to reflect their level of investment and the nature of your project. It may be a discount voucher, invitation to a launch event, the first product off the line or shares in the company.
6) Find your audience
Starting a crowdfunding project is a great opportunity to open new doors, reach new audiences and extend your market. Think about befriending industry leaders, getting along to events, building your networks on social media and drilling into your own contact book to get your name our there!
7) Segment your audience
Whilst your key messaging needs to be consistent, you’ll need to tailor your comms for the different audiences. Your most loyal customers will feel a little miffed if you introduce yourself as if they’re total strangers and total strangers will just think you’re just plain weird if you get all ‘matey’ with them!
8) Choose a funding site
When the funds come pouring in, you need to manage them and crowdfunding websites provide the perfect spot. Kickstarter, Indiegogo, CrowdCube, and SEEDRS are just a few. They all have different terms, so check out the sites and see which one suits you best.
9) Make them believe in you
Not only do you need to have a stellar proposition, you also need to prove you can pull it off. Everyone wants to be on the winning team, so make your backers believe you’re set for success. Get to know them, make it personal and prove that you have the experience and know how to make this a truly great project.
10) Keep your eyes on the big picture
Whilst you might not be out for world domination, it’s important to see this venture as a wider extension of your business rather than a one off event. After all, who knows where you’ll end up! A man in the US who wanted to crowdfund just US$10 to make a potato salad ended up with more than US$8,800 to play with!
Over the past few years we’ve helped Chapel Down Winery and Fourex to kickstart their crowdfunding ventures with great success. On 21 April, you’ll find us sharing our pearly wisdom at the Crowdfinders Live Event in London.
You can join us there, give us a call on 01892 541111 or email us to chat about how crowdfunding could give your business a helping hand.