Crowdfunding has recently become a $16 billion industry. Businesses and nonprofits all over the world have been successfully raising funds from crowdfunding campaigns, which are still a very new practice of funding. Crowdfunding is a fundraising model to collect small donations from a large number of people.
How it works
There are many crowdfunding sites which can help you launch your campaigns (top successful ones are mentioned further in this article).
You will create a profile where you can upload the pictures and describe your story or product that needs funding. Then your social network will be activated and all friends and followers notified of the campaign. Collected funds will be deposited into your account.
The crowdfunding sites are generally free of charge, but you should keep in mind that the donation processor will charge minimum a 2.9% processing fee and possibly an additional fee per transaction. International wires generally cost extra.
There are a few tips for a successful campaign that we would like to share with you.
- Personal touch
Your story should be unique and personal, show passion about your cause. Show your potential backers how the campaign will impact people’s lives. Tell them how your cause will solve the problem. Include a video, a graphic, or a picture to stand out.
- Set realistic goals
Remember that “what you wish” versus “what you need” for the project are often times two different things. Many crowdfunding sites highlight not only the dollar amount raised, but also the percentage relative to your initial goal. It doesn’t make the campaign look successful to your backers when they see low numbers. On the other hand, it is always rewarding to contribute to a winner and beat the stats.
- Be prepared and pre-prepared
Once the campaign is launched, make sure to respond to all inquiries and emails regarding your cause/product. You must demonstrate knowledge and clearly explain what the funding will be spent on.
- Hard work
Start working on your surveys and reach out emails long before launching the campaign. Make them personalized stressing the importance of the cause. Engage with your backers.
- Appreciate the feedback
Money is not the most valuable item that you will receive during your campaigns. You will receive feedback from your potential donors and backers. Take notes of their ideas, recommendations, wishes, preferences. All are equally important for your growth.
Top 5 crowdfunding sites are: