In the past year I have been involved with a good number of crowdfunding campaigns at various degrees. I ran one that raised $285,000 on Kickstarter, advised on one that raised almost $150,000, and helped with about a half dozen others. People seem to be approaching me left and right asking, “Can you do what you did for them and just plug in my venture?” My answer: it doesn’t work like that.
The campaigns I’ve worked with have been successful because the founder was at the center of the entire project. They went all in, as did everyone else involved. We talked to dozens of others who had been successful and not-so-successful in raising funds to hear what worked, what didn’t, and what they would have done differently. We all collaborated on the messaging and outreach strategy, the key word being collaborated. Crowdfunding is an “all hands on deck” endeavor. You sacrifice your whole self and your social life to the campaign either until you’re funded or until it’s over. Sometimes it pays off, sometimes it doesn’t. By asking yourself the right questions and developing a pointed strategy you can save yourself heartache and side step pitfalls.
So if you’re looking to embark on the adventure that is crowdfunding, here are the five questions you need to ask yourself:
Are you ready to go all in? It’s all hands on deck or bust when it comes to being successful in asking people to give you their money. There’s no toe-ing in here. Your sacrifice is inspiring to others who are considering sacrificing 10, 50, even 1,000 dollars of their disposable income. Some founders go as far as sitting on a toilet until they get funded to show their devotion.
Can your current operations afford up to a 30-day slow-down? A huge misconception of crowdfunding is the “If you build it they will come” mentality (thanks to Kate from Indiegogo for that sound bite). Unless you’re an established company with a handful of employees to pick up the slack, it’s likely that you’ll need to slow down your progress until you’re funded. For some this is a day, for others it’s a month. You don’t know until you start, but there is a chance you’ll be 90% out of operational commission for 30-45 days.
Do you have a legitimate ask besides “we want money”? People want to feel part of something bigger than themselves, and crowdfunding gives them an opportunity to do that. Whether it’s helping a mere project turn into a legitimate start-up company or contributing to the development of a nostalgic masterpiece, people love to be part of a Cinderella story. The money is a means to do something bigger, so you need to ask yourself if that something bigger is a legitimate ask.
Is what you’re fundraising for worth what you’re asking? Put yourself in your target audience’s shoes and ask yourself, “Would I contribute what I’m asking if it wasn’t my campaign?” A lot of ideas are wonderful and could get fully funded if they asked for $20,000, but they ask for $100,000 instead, writing their campaign death warrants in the process. The goal number really matters. Be aspirational, but realistically so.
Are you ready to bare your soul? Something Seth Levine from Foundry Group told us at Unreasonable holds tried and true when it comes to fundraising: people don’t invest in products, they invest in people. This holds true with the crowd as well. People want to know who is behind the idea and in a sense fall in love with them. This means getting to the authentic heart of the founder and guiding your audience through a hero’s journey. It requires being vulnerable and real. For some, that comes out best through humor. For others, through heartache. However it comes out, it needs to be real and it needs to be you, and you need to be prepared for that.
If you’ve answered “yes” to all these questions, then you’re ready to get started. We at Marked Point have created the tools and training to help guide you through the process. Send me an email at sydney [at] markedpoint [dot] com to find out more.
Here’s to building passionate movements!