Crowdfunding: reaching your goals with 5 Expert Tips from the ReadyFundGo CEO
At ReadyFundGo, Australia’s reward-based crowdfunding platform for business, we think that it’s a privilege to hear about so many amazing ideas. We truly enjoy supporting innovators to launch their campaign and tell the world about it. Enthusiasm and passion are always palpable, and that’s no matter whether projects do well or flop.
One takeaway fundraisers can expect with no exception by the end of their campaign is a great learning experience, uncovering real market needs and moving forward with the funds raised, or getting back to the drawing board and trying again with a different approach. Frankly, there is no magic recipe to make crowdfunding campaigns successful every time. Projects, ideas, and target audiences are so unique that there is always something to be unexpected.
Having said that, after working with many Australian start-ups and entrepreneurs preparing reward-based crowdfunding campaigns, I have singled out five ingredients which contribute immensely to fundraising success and shall be equally applicable to equity crowdfunding — now available in Australia for unlisted public companies.
Plan your campaign for success
Since the early days of crowdfunding, there is this unfounded hope that awesome ideas or prototypes are enough to raise funds. It’s time to dispel the myth once for all. There’s a huge amount of work involved in preparing campaigns, among which reaching out to the media and influencers, generating signups on a landing page, and building a tribe of followers and raving fans is key. The bottom line is: funds do not arrive by magic.
Fine-tune a compelling message in your video
Did you know that people and goldfishes now have a similar attention span? You don’t have much time to convince potential backers to support your project. Because of that, videos are an ideal channel to communicate a lot of information quickly — with 55% of consumers paying close attention to them versus 52% for social media and 49% for news articles.
If you are serious about your campaign there is no way around it, so start planning what will go into your project’s video as soon as possible. Try keeping it short and tell your main message within the first 15 seconds.
Get backers to pledge from day one
Some crowdfunding campaigners do not always appreciate that social media engagement and followers do not automatically convert into pledges and backers. I have been told many times:
“Oh it will not be a problem for us, we have 4,000 Facebook likes” or “no worries, I have sent a message to my contacts, so they know that we will be live soon.”
However, it is essential that you get your campaign off to a good start by proactively encouraging a crowd of serious backers to pledge from day one. If you do not start well on day one with people backing your campaign and sharing it on social media it will be tough to build up steam. Seeing initial commitment is a critical decision-making factor for potential crowd members to fund a project, and you only have one chance to make a first good impression.
Think carefully about your funding goal
You might be tempted to raise as much money as possible and get quite carried away dreaming. But it is often best to seek less and exceed expectations to generate more buzz and make things more achievable.
If there is a significant gap for too long between the amount you have raised and the amount you are asking for backers may be put off thinking that you will never make it.
As part of developing your funding goal it is important to consider the financial details thoroughly including account fees, transaction costs, and any relevant taxes as well as any costs of distribution of your product or service.
Have the right team members in place
Planning for crowdfunding success takes time and effort, and it might just be too much to do it on your own. If it makes sense for your project, try assembling a team with a mix of skills so you can develop a better product or service as well as manage your campaign more effectively. Additionally, working with co-founders or co-fundraisers is usually the best way to expand your network and find relevant connections. Several skills are required to run a successful crowdfunding campaign and it is unusual that one person would have all of the relevant skills.
Jill is the CEO of ReadyFundGo, a leading reward-based crowdfunding platform for businesses and innovators in Australia. She has assisted many crowdfunding campaigners with their crowdfunding goals. Jill recently became a board member of the Crowd Funding Institute of Australia (CFIA). Visit www.readyfundgo.com today to get your campaign started or get in touch at email@example.com.