Crowdfunding projects have one truth: you will either be completely funded or you won’t get the funding you need. Some companies are able to make millions of dollars. The potato salad crowdfunding effort showed what could happen with viral activity. Most campaigns won’t have this at all. They only have one advantage: knowing what they need before they start the campaign.
To make sure your next campaign has the greatest chance for success, here are the ways that you can get the information you need to make the best choices possible.
1. Know What the Minimum Amount is That you Need
You have specific costs that you’re looking to take care of through crowdfunding, but there are fees and other funding issues of which to be aware as well. How much of a take does the crowdfunding site take? What will your ongoing administrative costs be? Get everything into the bottom line and then raise that amount instead of the initial cost.
2. Be Happy When You Make it Inside the Ballpark
You don’t have to necessarily raise all of the money you need. As long as you get close, then you can often find alternative sources of funding to round out the budget. On Kickstarter, for example, most projects find success when they have a financial target that is $20k or less. Once you go above that amount, the chances of success can drop very dramatically.
3. Be Honest With Yourself
It’s easy to have rose-colored glasses on when you’re looking at your own project. Be honest with yourself, take those glasses off, and give your idea an outsider’s look. How good is the idea when you compare it to the ideas of others who are within your industry? If your idea doesn’t stand up as one of the best, then you are going to raise money like the best.
4. See Where People Stand Before You Even Start
Take your idea to the streets. See what the average person would be willing to invest into your project. On Kickstarter, the average pledge is about $25 if you take all industries into account. For some niche industries, however, the best donation point may be as high as $500. Find the sweet spot, put your best reward there, and then watch as the cash begins to start flowing in.
5. Go Beyond the Break Even Point
There is a real sense of urgency in many crowdfunding campaigns because it is a make it or break it ordeal. If you know what your break even point happens to be, you can take away a lot of the stress that can start to show up. Set your goals to go beyond the break even point, but don’t set them up in the stratosphere. Make them realistic and if you’ve done your research, you’ll pretty much know what to expect.
Crowdfunding is still in its early stages. Even so, if you treat it like a business opportunity using these 5 ideas, then you can experience a greater potential for success.
Strong proponent of individual liberty and free speech. My goal is to present information that expands our awareness of crucial issues and exposes the manufactured illusion of freedom that we are sold in America. Question everything because nothing is what it seems.