The internet has fundamentally changed our world in more ways than we can imagine. With over 2 billion web users and growing it has opened the doors to sharing media, documents, and ideas.
Not only has it changed the speed and the way in which we communicate but the way we do business has changed forever as well. The internet has transformed the financial landscape where now any person with a computer and internet access can become an investor in your business.
With the growing popularity of crowdfunding sites it’s clear that the idea of marketing to investors using a marketing platform is far more effective at attracting investors on a national scale than ever before. Crowdfunding opens doors; it’s as simple as that.
While crowdfunding sites simply allow you to cast a much wider net for getting investors for your business. However, just because it’s simple doesn’t mean it’s easy. Of roughly 60,000 unsuccessful crowdfunding projects, nearly 40,000 failed to meet even 20% of their funding goal.
The good news is you can greatly increase the likelihood that your new idea will get business funding if you follow others who have achieved successful crowdfunding campaigns.
Remember, success leaves clues.
Here are three secrets to successful crowdfunding campaigns:
Perfect Your Pitch – if you ever watched the show ‘Shark Tank’ the pitch is one of the most important parts and can make or break landing an investor. To walk away with a shark like Mark Cuban as a business partner requires having an excellent pitch. As Mark Cuban said, “It’s only those with the will to prepare that do win.”
Now don’t worry, you don’t have to swim with the sharks, in crowdfunding you get to swim with the goldfish.
For starters, write up your initial draft, include photos, and shoot a video explaining what you want to accomplish, the offer and why you should get funded. Speak to your targeted audience and let your passion shine; you want your investors to be your customers.
Send out the pitch presentation to your friends and family to get feedback. Make the necessary changes and perfect the pitch. Once you got the pitch down, start finding initial backers prior to launching your campaign. Shoot for 20-30% of your funding goal in pre-pledges so you can launch your campaign with a boom.
Test Your Rewards – the base of every successful campaign is your following. These are people who believe and love what you’re doing and want to be a part of it. They want the product or love the idea so start early by testing your rewards/perks. Get feedback from your personal network so you can perfect your rewards for investors.
Get Pre-Pledges – pre-pledges are commitments from people who support you and will be there on the first day you launch your campaign as an investor. Since most crowdfunding sites provide a limited time frame for you to raise your funds ranging from 30-90 days, it’s crucial to start with some momentum. Those with successful campaigns had their campaigns go live only after they had initial backers. Let’s face it; no one wants to be the first one to put money into a newcomer’s campaign.
Did you know successful crowdfunding campaigns get approximately 20-30% of their funding from people they already know?
Every day you read about how people are raising millions of dollars through crowdfunding and private investors. Before you get on a crowdfunding site like Kickstarter or pitch investors you may want to consider a crowdfunding expert to help you structure your campaign.
Crowdfunding is a strong stepping-stone for getting private investors for your business. Once you find a crowdfunding platform, perfect your pitch, and establish initial backers; develop a marketing plan to reach as many people as possible so you can keep the momentum of your campaign going once it goes live.