Before we can dive into the steps to follow when producing a successful crowdfunding campaign, we need to fully understand what crowdfunding is and why it is so beneficial for businesses and the economy. By definition, crowdfunding is “the practice of funding a project or venture by raising many small amounts of money from a large number of people, typically via the Internet.” Through crowdfunding, a community of likeminded individuals can fund projects or invest in a business to connect with a greater purpose in a campaign.
Who's it for?
One common misconception is that crowdfunding is just useful for small businesses and startups. This is definitely untrue! While crowdfunding creates a funding opportunity that certain smaller businesses may not have received in the traditional way, it also is a great outlet for more established companies.
Now that we (hopefully) understand crowdfunding, here is a list of steps to follow when trying to launch your campaign. By following these steps, you can maximize your investors and funding.
1. Choose a goal: Your first target should be the lowest necessary to reach a significant milestone - make it achievable!
2. Choose a crowdfunding platform/portal based on your goals: This is where MNstarter comes in! Using a portal helps to connect entrepreneur to the right kind of investors. Portals are important because it is a central place to share information about a crowdfunding offer. Backers and investors can use information on the portal to decide their confidence in the offer.
3. Make a list of promoters: Friends, bloggers, anyone with an audience to help you get your word out!
4. Plan the offer: This step is extremely important for a successful crowdfunding campaign! What is the exchange you are offering? Will you offer rewards or a promise for a return on an investment? Both? It's a good idea to plan rewards for certain big spenders in the offer.
5. Line up some initial backers: Make a list of initial backers to help provide social proof that your project is worth investing in. Initial momentum can attract more investment!
6. Choose start and end dates: Make a timeline of your campaign. Studies show that four-week campaigns tend to do best.
7. Launch the campaign!
8. Keep them informed: As the campaign progresses, keep your backers and investors informed to grow confidence in your team. Keeping this new relationship healthy is best for everyone involved!
9. Close the campaign: Make final announcements. Follow through! If you deliver on your promises, people will want to fund your next offer!
For any other vital questions, MNstarter has the answers! If you found these steps helpful and want to learn more, click here for a full article. To read more about the incredible benefits of crowdfunding, visit this article.