Over the years, crowdfunding has changed the standard business model, and introduced a new way to source the capital you need to start your business or launch your product. This game-changer has funded the likes of the Fidget Cube, the Coolest Cooler, and the Oculus Virtual Reality Headset and can fund your next million dollar product too. Here’s what you need to know:
What is Crowdfunding?
Crowdfunding is a social media fundraising strategy that allows entrepreneurs to pitch their business ideas to the masses. Individuals, in turn, give small contributions to allow the business owner to raise capital for the product pre-launch, and they usually receive the option to pre-order the product or to test out a beta version in return.
However, to start a campaign, you must first choose an SEC-approved crowdfunding platform. The most popular sites being: Kickstarter, Indiegogo, RocketHub, and GoFundMe. All of which are viable options to look into.
How to Build a Successful Crowdfunding Campaign
- Research your market and plan accordingly: Choose what your product will be, what the time frame is to develop it, and which demographic the product will suit.
- Choose your platform and set your goal: Decide which SEC-approved platform is right for you, and choose the amount of money you will ask for, and the length of time your campaign will be live.
- Have a working prototype: It’s important to have something tangible that your contributors can get behind and support.
- Market your product: Advertise your product in the appropriate digital space to your audience.
- Interact with your audience: Make the experience personal for your contributors. Inspire them with your mission and your vision.
- Be open to feedback: Contributors who have shown a vested interest in your venture might have some good ideas and opportunities for you to enhance your product before launch.
- Thank your contributors and offer rewards for contributing: It’s crucial to offer your supporters something that they wouldn’t otherwise be able to get. Maybe you send them a small gift as a gesture of appreciation. Or set an earlier launch date specifically for them; before the product’s release to the general public.
Crowdfunding is an excellent strategy to consider when trying to get your business off the ground. It allows you to engage with the interest of the general public and gauge the potential success of your product. Use this information as a jumping off point into your own research, and make the most of your next entrepreneurial adventure.