Crowdfunding is evolving into an industry all in its own. With an expected $10 billion to be raised in 2014 alone and an expectation to create more than 250,000 jobs, it is becoming an influential part of the global economy. Is it any wonder why entrepreneurs are trying to develop innovative ideas to get a piece of this ever-growing financial pie?
There are some specific trends being seen right now with crowdfunding of which you need to be aware. Not only will this help to maximize the growth you can see in your business, but the growth of your financial portfolio as well.
The Individual Entrepreneur Has More Power
Before crowdfunding, the individual entrepreneur had a difficult road to walk when it came to getting money for a good idea. They’d either have to approach backers and sell off a percentage of their idea to get money or get seed cash from family and friends. Now they can approach thousands of potential backers and determine if there’s a market for their product or idea in one step instead of several.
The individual backer can also become a fast competitor in highly competitive industries because of the feedback that comes from a crowdfunding campaign. From different colors of products to ideas for improvement, the sky is literally the limit on the feedback that can be received and when taken seriously, the individual entrepreneur can turn that feedback into some serious cash.
Existing Networks Can Be Leveraged
For the creatives out there in the world today, there is always a story that exists behind the fundraising story. It’s the motivation behind what could be a good idea and this backstory can be sold in such a way that it helps people relate to a campaign in a highly personal way. To accomplish this, an entrepreneur’s existing network can be used to kickstart any campaign on any crowdfunding platform to raise awareness of it for free.
You’ll find this quite often with musicians and writers, but entrepreneurs and businesses are jumping on board with this trend as well. It’s an easy way to outreach to strangers who fall outside of the target demographics to expand a business footprint.
Make Sure Your Product Hits Popular Categories
The trends in crowdfunding right now, across all platforms, are in technology, video production, and apparel. Two of the best fundraising campaigns to date have been the Veronica Mars movie project and the Pebble smartwatch. Even more recently, the Reading Rainbow campaign shattered the records for the amount of contributors that jumped on board with an investment.
These all have one thing in common: the average backer felt like they had a personal stake in the end product. Whether it was from sheer fathom or a desire to see children succeed, people wanted to put skin in the game. It is these trends that must be followed today for a crowdfunding campaign to truly succeed. If you can do that, no matter how big your business is, then you can be great.
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