Crowdfunding: how to raise €1 million in 10 steps
Click. You did it. You just clicked publish on your crowd funding campaign. After years of brainstorming, months of planning, and long hours perfecting the campaign, you are on your way to making your idea a reality. However hours pass and no one comes. No dollars arrive. And the dreams of changing the world fade away.
This is too often the story of crowdfunding gone awry. While there are plenty of tidbits of advice on the internet from people who have never launched a campaign before, here are 10 tips I followed to raise over 1.2 million dollars (1 million euro) in our crowdfunding campaign for TrackR bravo.
Video is one piece
The video demo of your product is the most important piece of content for your campaign. However, the video is only one piece of the campaign and there are lots of other things to focus on.
Focus on story not quality
I have seen far too many great looking crowd funding videos that don’t sell at all. Take a look at some of the best crowd funding campaigns don’t necessarily have the highest quality cinematography but they all tell an amazing story. Check out the ii earphones snap for an example of a very simple but compelling video: https://www.indiegogo.com/projects/ii-earphones-snap-strap/x/1677032#/
Make sure mum buys
Do not be the crowd funding campaign with zero backers. It’s pathetic because it means that not only did your mother not buy one, you didn’t even buy one. The first backers will be your friends and family. If you are scared to sell to friends and family, I suggest you stay away from crowd funding.
Reason to share
Campaigns don’t get shared all over the Internet by accident. There is a strategy to enable people to share. A reliable way to get people to share the campaign is to give them something in exchange for sharing. A discount off, an extra device, anything is great. And remember that the more valuable item you give your backers, the more likely they are to share your campaign!
Price to win
The pricing of your packages is essential. On mobile, potential backers will only see your video and the prices (Your well designed page won’t even be seen!). It makes sense to be strategic in your pricing to push people to bigger packs.
Success brings more success. By setting a reasonable goal that you can quickly reach enables you to set a tone of success to your backers. This is essential for gaining and maintaining campaign momentum. Set the goal to something that you can reach within 24 hours if possible!
Don’t update your backers once or twice during the campaign. Data shows that more frequent campaign updates directly correlate to a higher percentage of campaign success! People want to hear from you so plan updates in advance.
Most of the money contributed to your campaign will come from people who find out about you via email. Start well in advance to build a large email list. The larger the list, the bigger the campaign!
PR is overrated
PR is excellent for creating brand trust and getting people excited but it will not drive millions of people to your campaign. The news cycle has sped up and news sites are less concentrated for this to be an effective customer acquisition method. Focus on PR to create brand trust rather than customer acquisition.
Failure is not failing
Remember that crowd funding can be used to validate markets and ideas. If you don’t reach your goal, use the opportunity to learn from your customers and find out why it did not meet your expectations. This is what the Coolest Cooler did when they were unable to meet their initial crowd funding goal. Six months later, they relaunched as one of the biggest Kickstarter campaigns of all time.
By Chris Herbert, CEO & Co-Founder at TrackR
Read the May 2016 issue of Business Review Europe magazine.