Crowdfunding is using the crowd to fund a project for any product or service that one may need funding for. Anyone can create a Crowdfunding campaign, and many are successful. Here is what you need to know to launch a successful Crowdfunding campaign.
Step 1. You need to have a product or service in mind, and a clear outcome of what the funding will provide. You need to choose a platform to launch your campaign on, for example, Reach, Kickstarter, Indiegogo, or GoFundMe. If you are inventing a new product, you should already have a prototype build so potential backers can see what the end result will look like.
Next, you need to choose the type of campaign you want to run. Below are the different types of campaign funding modes and funding types:
Rewards based funding: This type of Crowdfunding offers the backers a reward for a donating a set amount. It is typical to see this funding type on a platform like Kickstarter, where users can donate a set amount of money to receive the product that is being funded.
Donations based funding: Usually non-profits and other charities use this funding type as a means to raise funds. There are no rewards that are given to the backer for donating a set amount.
Equity funding: Typically start-up companies that are looking to raise capital for their product or service will use this funding type. Users can invest, and receive equity of the company in return.
All or Nothing (AoN): This funding mode allows you to set a start date and end date to your campaign. If you raise the amount you set as your funding goal, then the funds that were raised will be processed and you will be on your way to creating your project. If you do not reach the funding goal, you will not receive the money raised, and the backers will keep their funding.
Keep it All (KiA): This funding mode allows you to keep all the donations that your campaign receives. It is typical to see non-profits use this mode to raise funds for a charity.
Step 2. Research this could be the most important step in the entire process. You need to gather all of the info needed to create a successful campaign. There are many resources available such as blogs, podcasts, forums, videos, and more. There is no shortage of information on the web when it comes to Crowdfunding info, so take advantage of the knowledge that is available.
This step also includes your finances. It will be a big part of the campaign, as it will determine how much marketing you can afford, and how you will be breaking even. Successful Crowdfunding campaigns cost money to generate large amounts of donations, so don’t expect to receive money without investing into the project yourself.
Step 3. Conduct your pre-launch campaign. You should have a pre-launch landing page, and social media pages built to gather information and market the launch of your campaign. This is going to get your audience excited to donate to your up and coming campaign.
Step 4. Launch the campaign. When launching the campaign, be sure you have a Crowdfunding video created along with a detailed description of your product or service that you are going to offer.
Step 5. You are now running a Crowdfunding campaign. All of the research that you did in step 2 will be implemented and generate donations to your project.