Do you dream of launching your own business, product, or service, but don't have the necessary investment to get it off the ground? Well don't let go of that dream just yet, because there is another way - no loans required. We talk to Nicole Denholder, founder and CEO of crowdfunding platform Next Chapter, about the concept of crowdfunding and how to make it work for you.
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Rewards-based crowdfunding is a smart, popular, and proven way to raise money online from your network of family-members, friends, and even like-minded people you don’t know yet – aka “the crowd” – to launch your business or idea. In return for money from supporters, the project owner or business promises a reward for participating, such as a product, a thank-you postcard, or a personalised t-shirt. So how do you get started in crowdfunding? With my six top tips, you'll be up and running in no time.
1. Consider the Benefits
So why consider crowdfunding? You can
attract the funding you need to launch and build a successful business,
seek market validation for your new business, product, or service, and
bring to life ideas, products, services, or business lines, in any industry, that you passionately believe are awesome, and that you’re confident others would love to fund and connect with. Plus you can
generate market buzz for your business and utilise the timeframe a campaign creates to build your
motivation and empowerment.
2. Research Other Campaigns
Research other campaigns within a similar industry, product, or niche. Consider if they were successful, the types of rewards they offered, their funding targets, and delivery success. All of these factors will help you to craft a successful campaign.
3. Develop Your Story
Write up your initial pitch, including images, and shoot a video explaining what you want to accomplish, why you deserve funding, and what you want to offer. Speak to your target audience and let your passion shine through - remember, you want your funders to be your long-term customers. Once you're happy with your pledge, send it to your friends and family and tweak it based on their feedback.
4. Test Your Rewards
The basis of every successful campaign is a strong following. This refers to the people who believe in what you’re doing, want your product, and - most importantly - want to be a part of it. It's crucial that your rewards attract these loyal followers, so get ahead of the game by testing the success of your rewards. Turn to your personal network for feedback to make sure your rewards and price points are attractive to potential funders.
5. Secure Pre-pledges
Pre-pledges are commitments from people who support you and will fund you on the first day of your campaign. Since most crowdfunding sites provide a limited time frame for you to raise your funds, ranging from 30 to 90 days, it is crucial to start with some momentum. Aim for 20 to 30 percent of your funding goal to be secured in pre-pledges so you can launch your campaign with a boom.
Top tip! Successful crowdfunding campaigns source approximately 20 to 30 percent of their funding from people they already know.
6. Plan and Launch Your Campaign
Plan and prepare in advance as much as possible. Once you have launched your campaign, you'll be busy managing it and responding to enquiries and opportunities. Create a schedule for your campaign, which includes all aspects
such as admin tasks and responsibilities, your website, marketing, media relations, content creation, social media, and customer service, in advance. Come launch day, don’t just sit back and wait for the money to come rolling in. Market your campaign assertively and consistently, and keep in touch with your supporters to increase your chances of success.
Keen to learn more? Get in touch with Nicole to organise a one-to-one session and learn more about crowdfunding, find out if it's the right option for you, and get some more insider tips on how to build a successful campaign.
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