Ten ingredients for a successful crowdfunding campaign
Ready to launch a crowdfunding campaign? Here are 10 tips to help you succeed.
1. Make sure your project is a good fit.
A project needs to be compelling to garner the amount of support and attention required for a successful campaign. The most successful projects are ones that manage to capture an audience’s emotions and get people excited—whether it’s because the idea is very unique or because it is related to a subject or cause that they are already passionate about.
2. Leverage an existing passionate audience.
Projects that appeal to already existing, highly supportive and passionate audiences (e.g. projects that deal with topics that have strong grass roots following) are far more successful because those audiences help support and organically promote the campaign on behalf of the project owner.
3. Make sure you are a good fit
Creators who are already familiar and comfortable with social media will better be able to promote their campaign in optimal ways and keep their online audiences engaged throughout the process.
4. Don’t forget your audience
Part of the appeal in crowdfunding comes from the audience’s desire and ability to participate in the development process. Creators that regularly engage with their supporters by providing regular updates on the project’s progress or other activities related to the project and respond to comments from their supporters will tend to be more successful.
5. Leverage a strong existing network
Successful crowdfunding campaigns typically start off being promoted in the project owner’s network and spread from there. A strong existing social networking presence and network of followers make it easier for creators and project owners to leverage the power of the social networking side of crowdfunding.
6. Prepare high quality promotional materials and invest a high level of promotional effort
Successful campaigns typically result from strong promotional efforts by the project owners throughout the entire duration of the campaign. In addition, the quality of promotional materials, such as a promotional video or trailer, need to be of good quality. The promotional materials need to inspire confidence among potential contributors that the final product will be worth their contribution.
7. Offer compelling contributor incentives
Typically, tangible goods (i.e. branded merchandise) or pre-sale copies of a product are the most compelling incentives as well as advanced access to the product. Unique experiences related to the product and/or its creative team are also good incentives.
8. Set a realistic funding goal
First, ensure that the project’s funding needs fit the medium. Successful creative projects tend to have funding goals of raise amounts from $5,000 to $50,000. The more realistic your funding goal is, the more likely you are to reach or exceed it.
Second, projects that succeed in reaching their funding goal tend to have a goal that makes sense from the perspective of potential contributors. An amount that appears too high can make it seems like the creator either does not have a good understanding of the cost of producing his/her project or that they are simply greedy. A funding goal that seems too small similarly makes it seem like the producer does not know the real cost of producing their project and could create doubt in a contributor’s mind about whether or not the project will actually get made.
9. Provide a clearly-defined fund allocation plan
Projects are more likely to be successful if the creator clearly demonstrates why they need to raise the funds they are asking for and how it will be used to further their project. Contributors need to feel confident that their contributions will be well-used.
10. Don't forget to do the math
When determining your funding goal, make sure you account for the cost of preparing promotional materials and the cost of any incentives or rewards you are providing (e.g. Manufacturing and shipping costs). In addition, factor in any fees or commissions that will be paid to the platform and/or third party payment processing partner. Calculating the total cost of your campaign will ensure that you set a realistic funding goal that allows you to cover the costs of your crowdfunding campaign and meet your project’s funding needs.