You may have seen a cool Crowdfunding campaign and wondered if it was a good idea to pledge some money. It is hard to tell which campaigns are legitimate, and the ones that are likely not going to deliver. This article is going to cover the basics of analyzing a Crowdfunding campaign.
Using the right platform
Before pledging to a Crowdfunding campaign, you should do some research on the platform that you intend to pledge to. There is absolutely nothing wrong with donating to a Crowdfunding platform that is not big and established, just make sure you know that the platform is not just trying to take your money. A good thing to check would be the terms and conditions, as well as the terms of service. Make sure you understand the return policy and other policies so that you can feel safe donating to that platform. If you do not want to go through the hassle of researching the Crowdfunding campaign, then using such established Crowdfunding platforms as Kickstarter or Indiegogo may be a good option, as you can rely on them to do an identification check. The large established platforms will require certain identification and sometimes bank statements. This way, there is no chance the Crowdfunding creator can just run with your money as soon as they reach their Crowdfunding goal.
Finding the campaign
Once you are sure about using the Crowdfunding platform, next is to understand what looks like a promising campaign. You do not want to give money to a Crowdfunding campaign that is likely not going to succeed or deliver. It may be tempting to donate to an interesting campaign for a cool new invention. Before donating to those campaigns, however, you should have a small checklist either written down, or even in your head, that can help you confirm that the campaign is legitimate, and will deliver if you send your money. What should you be looking for in a Crowdfunding campaign?
- First, how many days has the campaign been running, and how many backers does it currently have? If it is the first week of funding, and the campaign only has a couple of backers, then what does that say about the campaign? You need to ask why it is not successful yet.
- What does the campaign promise to deliver? Can the campaign deliver on what they promise? Is there any evidence of them being able to deliver?
- Who are the campaign creators? Can you read up on the campaign creators, and are they proven entrepreneurs? If you cant find them on LinkedIn or other platforms, they may not be serious about the campaign.
Those are 3 big questions you should be asking before donating to a campaign. It’s not hard and usually does not take a long time to research those points. If you are thinking of pledging to a donation based Crowdfunding campaign (that does not offer any product or service), then researching the campaign creators will be very important.
As you can see, it mostly comes down to research and putting forth an effort to see if the campaign is legitimate. No one wants to give their money away, and you should feel entitled to know where your hard earned money is going towards. The goal is not to avoid scams, rather, it is to only pledge your money towards those campaigns that deserve your money. It is certainly not easy to create a Crowdfunding campaign, and not always easy to donate, so you need to give credit where credit is deserved. Maybe you are not sure that you want to donate to this particular Crowdfunding campaign because you don’t really like the product, but you know that the campaign is going to be a success. There is nothing wrong with helping a campaign that deserves your money. The only thing you need to do is make sure that you are conducting the research before handing over your earnings.