Launching a Successful Crowdfunding Campaign – The Dos and Don’ts

Crowdfunding is an opportunity to gain traction among a wider audience while raising money so you can take your idea and turn it into a reality. The immense popularity of crowdfunding platforms is what encourages startups in the first place.

Everywhere you look, you’ll see success-story companies that came to be because of forums like Kickstarter and GoFundMe. However, that’s exactly what you’ll see- the success stories because no one talks about campaigns that go wrong and ideas that you should flush down the drain. If you want your startup to kick off and skyrocket like the ones you’ve seen, it’s essential that you take crowdfunding seriously by knowing what to and not to do. Here are crucial Dos and Don’ts to remember.

Do Explain Your Plan

People that fund your idea will only do so if they understand it and think that it can be of use in the near future. Even if your idea is brilliant and will help many people, it won’t get far until you get into the practical details of it. However, that’s not all; being brilliant won’t do much if you’re not responsible. That’s why it’s necessary that you be transparent with your audience and go into detail as to how you will spend their money.

Don’t Expect Your Funding From a Single Campaign

Being over-optimistic about your crowdfunding campaign can be detrimental because you’re not prepared to be disappointed when the inevitable happens; not generating all the required funds with a single campaign. Actually, the essence of a campaign is to simply bring your development team to the next stage of your idea. Once you reach the next stage and prove to your audience how you’re progressing, they’ll be willing to fund again and even get their friends in on it.

Do Involve Your Supporters

A crowdfunding campaign shouldn’t be all about securing capital but engaging with your supporters. One good way to do this is by involving them in the process. By giving special updates on how far your product has come, you ensure building a supportive base of backers. Meeting your product release deadline will be beneficial since it gives you an opportunity to pre-sell it to your backers. This allows them a firsthand experience of your product before it hits the shelves.

Don’t be Unrealistic

While there may be pressure to gather enough funds and meet deadlines, nothing should compel you to make unrealistic promises. Donors and supporters will have higher expectations, which can lead them to withdraw support at any time during the campaign if they discover that you weren’t being completely honest as to what your company would deliver. This tends to create a domino effect and you’ll end up with a bad reputation, which will hinder any plans of a crowdfunding campaign.

Do Get Creative with Your Campaign

A campaign isn’t just about setting up accounts and waiting for the cash to flow in. You’ll have to make an effort to convince potential donors and backers to support your idea. Let’s face it: there are thousands of startups looking to take off and you’ll need a pivotal aspect that makes the audience choose you. One way to do this is to be creative with your startup website.

Add plenty of pictures with larger and lesser text to get their attention towards your product. Share pictures of prints and drafts, a timeline of how the design has evolved. This is paramount to not just help backers understand your idea, but make them feel like part of a family that has been there since the beginning.

Don’t Ask For Too Much

Yes, there’s such a thing as asking for too much money and getting too much of it can be ineffective to your cause. On Kickstarter, campaigns considered successful haven’t even raised over 10 thousand dollars. Hence, the chance of becoming a multi-millionaire before your product is released is fairly low. Even if you somehow did have donors willing to give this much, there are laws in place that prevent you from raising over 1 million dollars in a year. I’ll explain in the next point why this is beneficial.

Do Consider Them as Investors

By having effective rules in place that prevent a campaign from raising over a million dollars in a year, platforms can prevent backers from giving too much. This is because supporters and backers are basically investors who expect something in return for their investment. In the case that a certain supporter funded you with a large amount of money, your campaign can get in trouble if you’re unable to provide them a reward for supporting you.

Don’t Forget To Ask For Opinion

Engaging with supporters and backers is a great way to gather support and generate ideas to further proceed with your idea. They’re your audience and they love being asked about their opinions, which is why it helps to take them into consideration while developing your product. Moreover, it helps to get market insight into the kind of people who will be coming in contact with your products and inventions.

Do Make an Interesting Video

A good video can do wonders for developing an engaged supporter base. Since there are multiple startups that people consider investing in, not everyone has time to read your agenda and what your product is about. A video can give them a quick summary about what you’re doing, who you are and how you intend to impact a certain target population with your invention.

Don’t Be Mysterious

While Satoshi Nakamoto might have made it far by hiding his/her/their identity from the public, the stakes are different at this point in time; people want to fund people and not just ideas. It’ll pay off to introduce yourself and members of the team. At times, your idea may not be as unique as you think but it’s still possible to drive a successful campaign if people believe in you and your ability.

These are some of the basic factors to keep in mind while organizing a crowdfunding campaign. It’s true that there is no objective recipe for success but hard work is undoubtedly an ingredient so as long as that’s there, and you follow some guidelines, you can make it.


Access our network of Angel Investors, Venture Capital or get instantly matched with a Lender. Create a crowd funding campaign or get a business plan by visiting us

Crowdfunding for a Business Is More Than Just Money

In the recent years, startup and small business owners have seen crowdfunding rise tremendously. Today, it is one of the most popular ways for business owners to fund their business operations without having to go to a bank to ask for a conventional loan. Of course, crowdfunding does not stop someone from approaching a bank for a business loan.

However, it only makes sense for someone to plan their roadmap carefully and fulfill all their financial needs with an effective crowdfunding campaign on the right platform. For anyone who believes crowdfunding is just a way to collect funds from many different people, they need to rethink that.

Crowdfunding Is Much More than Just Collecting Money

Much Easier than Traditional Funding

Traditional funding is quite a challenge for entrepreneurs and small business owners. As soon as you are at a point where collecting funds for your business is necessary, you start approaching the wealthy people, angel investors, venture capitalists, banks and other lending institutions for investments. The issue here is that you start at the wide side of the funnel and narrow down your options from there to reach the pointy side of the funnel i.e. finding the right investors. If you are unable to strike a deal with your final option, you will end up wasting all your efforts and time.

On the other hand, crowdfunding is the exact opposite of traditional funding. You start at the pointy end of the funnel, create your crowdfunding campaign and let the right people discover you. Those who find your concept attractive and appealing will invest. You will not have to go door to door to find the right person to invest in your, your business and your idea. This makes crowdfunding much easier than traditional funding.

Better Market Outreach

For you to increase your chances of getting the right investor on your side, you have to be at every venue, seminar and meeting where you think you will get a chance to meet the potential investors. However, you can only do so much in the limited time you have before someone else copies your idea and capitalizes on it. On the other hand, when you pick crowdfunding as a way to fuel your business financially, you don’t have to rely on your efforts and marketing outreach solely. The first step of crowdsourcing is finding the right platform since there are many to choose from.

You have to pick your crowdfunding platform based on its popularity and reliability in the public. In short, you benefit from the market outreach of the platform. If your crowdfunding platform is popular in multiple continents then you can expect your funds to be coming from all those places.

Less Riskier than Traditional Funds

One of the biggest issues with traditional funding, especially venture capital, is that such funding has a lot of risk associated with it. Venture capitalists are people or institutions that are oftentimes more interested in their own financial gain than they are in watching your business grow. Their purpose of investing in your company is to double or triple their investment. For that reason, they will often have very strict regulations associated with their investments. If they have doubts about the success of your idea, they will often try to give you the money as repayable loan – the regulations will still be strict.

If they think your product/service will become a massive success, they will try to throw in permanent royalty deals or attempt to take away as much equity in the business from you as possible.

People who fund your business through crowdfunding might not even ask for any stake in your company. Their contributions can be as small as $5 and they might not even expect anything in return. Sometimes, they can make big investments without asking for a lot of equity. On many occasions, their rewards are as simple as a free sample of the product.

Brings Professionalism Out of You

Just because crowdfunding is less risky than traditional funding does not mean you can be all casual with it. Asking for the world to invest in your concept is serious business and you have to be at your professional best to convince people to invest in you. The first thing you will have to do is come up with a proper business plan. Secondly, you want to have a team of right professionals by your side that people can look at and trust. If the air around your team is negative, people will not invest a single dollar in you. You also have to have a good explanation of where you will be spending the money you collect.

If you have prototypes, bring them to the front. Create videos to showcase your technology. Be sure that your product/service is a solution to an existing problem. Do not create a problem and then fix it with your product. Angel investors often frequent crowdfunding platforms and they have to make sure that they are investing in serious people and business, not a hobby.

Helps You Create a Community of Followers

A lot of investment on crowdfunding websites comes in the form of small contributions. These people are not investors but regular people who like an idea, and want to see it in practical form. They believe your idea can solve one of their issues or maybe make the world a better place. If you can convince them that your idea does either or both of those things, they will actively invest in it. These people are early adopters of your technology/product/service and will also act as word-of-mouth marketers for your brand.

Final Thoughts

It is not a coincidence that crowdfunding has become one of the most popular ways for new businesses and entrepreneurs to support their early growth, marketing and expansion through crowdfunding. They must be seeing some benefits of funding their efforts through crowdsourcing over conventional funding. If you are someone who is considering the same route, the first advice for you would be to choose a platform with trust, reputation and outreach for your crowdfunding campaign.


Access our network of Angel Investors, Venture Capital or get instantly matched with a Lender. Create a crowd funding campaign or get a business plan by visiting us

Equity crowdfunding and venture capitalism: Why it matters?

Equity crowdfunding and venture capitalism

The United States government has approved a landmark law for entrepreneurs, especially those involved in the small and medium enterprises sector, in 2012. Known as the Jumpstart Our Business Startup – or JOBS – Act of 2012, the legislation enables startups to raise as much as one million dollars through various websites that will be established following the implementation of the law.

There are a number of people, both supporters and critics of JOBS Act, who argue that the law will affect the more traditional venture capitalists. They say that by providing support to crowd funding – or raising funds that come from different people to finance a business – the government essentially removed venture capitalists from the picture.

A number of people are happy with this possibility, but a whole lot more are shaking their heads. After all, venture capitalists, over a period of time, have made it possible for a lot of major businesses to flourish.

The reality, however, is that JOBS Act does not diminish the relevance of venture capitalism in the field of entrepreneurship. In fact, it can be argued that the law will strengthen the system and would enable more businesses to enter the arena. Here’s why:

Crowd funding and venture capitalism may end up having different clients

According to the law, the legislation will enable businesses to raise as much as one million dollars in capital through crowd funding that will be assisted by dedicated online portals. This in itself shows a major difference between the two funding sources.

Based on latest studies, the median of venture capitalist investments in the country in the past three months is at four million. This means that the clients of crowd funding and venture capitalism will come from different backgrounds as they will need different amounts of money.

Instead of “killing” venture capitalists, the law may have just given them the opportunity to find better deals as businesses that need smaller funding will have another platform for them to look for investments.


Crowd funding and venture capitalism are made for each other

These two are in fact a perfect match. With the existence of an established system of funding (i.e. crowd funding for smaller businesses and venture capitalism for slightly bigger ones), entrepreneurs will have an assurance that there will be support as their business grows.

Moreover, the existence of crowd funding system should not threaten or drive away venture capitalists as there are always businesses looking for investments. In fact, they can even use the portals to take part in crowd funding initiatives or scout possible partners that are looking for investments.

The nature of the legislation is to provide entrepreneurs – especially business startup owners – with an equal opportunity to look for people who may help them in establishing their businesses. While it is true that the law will create ripples and affect the already established system of funding in the United States, it is imperative for everyone to understand its objectives and see to it that it achieves its goals.

More detailed information and useful advice can be found at Created by Mark Favre, it offers expertise and assistance with developing and funding your concept, including a private forum for queries and discussions. If you need access to investors and funding providers, please do check our


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