Crowdfunding Tips

These crowdfunding tips will help you begin to understand the process.

Crowdfunding definition: “Crowdfunding is a method of raising [non-equity] capital in small amounts from a large group of people using the Internet and social media.” (Source: Techopedia)

  1. Platform: all-or-nothing (fixed) or partial (flexible)
  2. Payment system fees
  • Understand crowdfunding vendor guidelines
    • Kickstarter requires you to apply. Typically, Kickstarter does not support on-going social causes, it requires prototypes for design and technology categories, and it prohibits certain products.
  • Campaigns are typically run for 30 intense days, although it can run longer
  • Key promotional components: inspirational video, creative thank you gifts, influential media and blogger relationships, viral leverage from social media (and email), backers and customers who contribute and promote, and fundraising goal and campaign duration determined.
  • Crowdfunding process:
    • Frequently, a U-shaped campaign
    • Funding source statistics
      • 30% – family, friends, and friends of friends
      • 30% – find through other sources, e.g. media coverage
      • 40% – varied sources
    • Ideally begin campaign on Mon., Tues. or Wed.
    • First, 72 hours usually critical to fundraising momentum
  • Average campaign donation: $71
  • Most popular campaign donation level: $25
  • Efficiently prepare by analyzing similar (product category) crowdfunding campaigns
  • Become active on social media at least a month (or preferably six months) before the campaign begins, especially if you don’t already have a large database of contacts

One Response to “Crowdfunding Tips”

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