Crowdfunding Your Business
Johanna Baker-Dowdell tells her story of successfully publishing her book, Business & Baby on Board, using crowd funding.
Remember when people used to pass around the hat and ask others to pitch in for a cause, like a friend's operation or the local school's sport equipment? 'Crowdfunding' works in much the same way, with start-up businesses and creative industries using online funding platforms like Pozible, Kickstarter or Indiegogo in place of the hat.
So how could crowdfunding work for your business or project? Essentially, you are asking your network, or 'the crowd', to pledge their support for your project, usually in exchange for rewards.
This time last year, I ran a crowdfunding campaign on Australian platform Pozible to raise the money I needed to self publish my book Business & Baby on Board. My campaign covered editing, cover design and printing costs, and I contributed the rest.
My campaign was overfunded, but it was actually the second campaign I ran to publish Business & Baby on Board (the first missed the target by just $320 so I made a few tweaks and ran it again). After learning from a failed campaign and then running a successful one, I have a few pointers to make crowdfunding a success for you.
Share your story
While most campaigns offer some sort of reward in exchange for a pledge, not all do. You need to have a compelling reason for people to hand over their money. This is where your story comes into it, so speak from the heart and help your supporters understand why the project is important to you and why they should pledge to it. Use words, videos, photos and whatever else you can think of to share your story.
Entice pledges with rewards
As I mentioned above, most crowdfunding campaigns offer rewards for pledges, so it pays to think about who is likely to support your project and what they would like in return. I had a mix of rewards, from a bookmark for a $5 pledge, to a signed copy of Business & Baby on Board for $25, right through to coupon ads in the back of the book for $200 and a one-day personal public relations consult with me anywhere in Australia for $1 000.
Crowdfunding takes time
While your campaign is running you will be forever encouraging people to pledge, thanking them for pledging and making sure you reach your target, so don't expect it's a 'set and forget' funding strategy. A small campaign might make its target in two weeks, whereas a large campaign might need a full three months to reach the funding amount. Be prepared for the long haul.
With some crowdfunding platforms, like Pozible, if you don't make the target, you won't get the money. Others allow you to keep whatever you raise, but it costs you more in fees if you don't hit your target.
Support other crowdfunders
Before going down the route of crowdfunding yourself, it's a good idea to support other projects. This way you will know how the process works and supporting others shows you believe in the system.
Do your sums
You often hear stories about crowdfunders reaching their target, but falling short on what they needed because they forgot to add the platform's fees (usually around five per cent) or PayPal fees into their amount. When working out your target include everything your project entails, plus fees and itemise all this in your project spiel.
The biggest buzz in running a crowdfunding campaign is watching a community develop around your project in front of your eyes. It is an incredible experience that is both exciting and nerve wracking, but I highly recommend it.
About Johanna An author, journalist, blogger and public relations consultant, Johanna Baker-Dowdell tells stories through her business Strawberry Communications. Johanna writes for newspapers, magazines, websites, blogs and social media and works with SMEs across Tasmania, nationally and internationally to generate publicity. Connect with Johanna
An author, journalist, blogger and public relations consultant, Johanna Baker-Dowdell tells stories through her business Strawberry Communications. Johanna writes for newspapers, magazines, websites, blogs and social media and works with SMEs across Tasmania, nationally and internationally to generate publicity.
Connect with Johanna