Making the Most of Crowdfunding - RSA

Making the most of crowdfunding

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  • Picture of Eileen Burton
    Eileen Burton
  • Crowdfunding
  • Social innovation

Crowdfunding has become a way of fulfilling dream projects these days. It can be the most convenient way to raise money and the business of crowdfunding is increasing. Eileen Burton shares some ideas for getting a good outcome.

People like crowdfunding because it can raise capital for products and different business models and because they think that their message can be delivered through different social media platforms across the globe. This way, in theory, anyone can launch his or her business without investing much capital and innovators and investors can test demand before too much money is ploughed into creation or purchasing.

Crowdfunding does not always assure the success of a project; there are a lot of failed and unlaunched projects, as well as effectively sponsored ones, and some pitfalls that innovators can avoid. This means avoiding some common mistakes. 

First, choosing the right channel. Those seeking crowdfunding need to be aware of mistakes that can be made if you choose the wrong channel for your project. You can choose Kickstarter for raising money because you want flexible funding without setting a fundraising goal. It is a huge channel with great visibility if you are considering running a hot campaign. However, if you find that you need help starting a campaign and you are unsure of the procedure, then to better opt for niche crowdfunding channel instead of an international platform. Likewise, if you are trying to raise money for a charitable cause, then head over to GoFundMe but checkout for science project funding where you will meet more educated peers who will assist you raising funds. To be successful each project needs to find the right match. 

Second, realism about expectations. One of the common mistakes made is to set unrealistic expectations and setting unattainable goals. People believe that crowdfunding is a tool to raise millions of dollars within days; in reality an average project can raise some thousand dollars with the help of friends and family. When crowdfunders see that they could not reach their set goal, they start losing enthusiasm. 

Third, complete the research before a fund is launched. Thorough research is the most appropriate way to analyse how to position your project and will play a huge part in determining whether you are successful or not. With proper research and planning campaigns are more likely to be successful and projects protected from failure online. Pay attention to the strategies that have been adopted by successful and unsuccessful projects in your category. Before launching a crowdfunding bid, project leads need to read some of the plethora of articles and blogs out there and ask questions regarding their experiences and the specific project at hand. Seeking out advice from early creators can help new ones to plan, promote, and produce accordingly and this means taking time to calculate how much time you are going to require in order to build audience for your campaign.

Fourth, take time. Those seeking funding often fail to realise that the process of crowdfunding requires a great deal of time upfront as well as enthusiasm. This means planning in advance – a month or two at least before launching a campaign and involving more people who understand the project and can spread the message. Establishing a community of interested people saves time in the long run as they can share the message through social media. 

Finally, ask for what you need and no more. There is a temptation to ask for more money when it is not required; if research is done well, then requests will be sensible and if they are not, funders can be put off. When a project can be sponsored by more modest amount of money, then this needs to be stuck with and the temptation to avoid higher goals avoided; this is particularly the case in relation to those platforms that allow fund seekers to keep the raised amount with even though they have not been successful. Crowdfunding is all about how the ask is made.

Eileen works as a Head Hunter for an overseas company that offers Assignment Writing Help. She also enjoys writing blogs on topics related to HRM, career consultancy and career growth. When not working or blogging, she enjoys reading novels.

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  •  Thanks  Eileen Burton for sharing your ideas ,are very helpful