Lately, Tahoe Production House has been helping clients with their Kickstarter videos for crowdfunding their ideas. It’s a neat concept and allows ideas that would normally have a hard time getting off the ground financially become a reality.
So what is crowdfunding exactly? It builds on the idea of crowdsourcing: “The act of outsourcing tasks, traditionally performed by an employee or contractor, to an undefined, large group of people or community (a “crowd”), through an open call.” (Wikipedia). In short, crowdfunding pulls together people to fund a project, business, or cause, over the Internet.
Crowdfunding websites are growing in popularity and are allowing entrepreneurs with an idea to get funding from investors, producers, and causes with contributors. Also, social media is changing more than the way we market and communicate, it’s also changing the way we raise money. The way these websites work are fairly simple enough, generally people, businesses, or charities pitch an idea, set a fundraising goal and set a deadline for raising funds. Potential investors can review the pitches and decide if the idea is worth supporting. On many sites investors or funders, are rewarded if the project hits it funding goal.
So how can you be successful at “Crowdfunding”? To catch people’s attention and get potential funders or investors, you need to stand out, and engage your community and close the sale. The first step would be to choose the right crowdfunding site for your project. Each type of site caters to a specific audience. More creative endeavors like video production projects do well on sites like Kickstarter or IndieGoGo. Do you have a more traditional business model? Look to ProFounder. Non-Profits can raise money on sites like CauseVox or FirstGiving. Choosing the right site can make all the difference.
Also, know your target audience and plan ahead. Focusing on a passionate niche to target a specific narrow audience will set you up for success. A target audience might be focused in a geographic area; religious group or share a common background. Planning ahead can help out a lot. The bulk of funding tends to happen at the very beginning and end of a project. That’s why it helps to have things like e-mails or video responses planed out for the launch, middle, and end of a project.
One of the best things you can do is make a great first impression passionately and pitch your project. Get people as excited as you are about your project, but also be informative. Your project name, graphics, and description all are very important to stand out from the others. Once you have the money, have a plan to spend it. Tell people a detailed explanation of how exactly you’ll be using their money and keep all information transparent. People like to invest in a solid plan.
Lastly utilize your social networks. Crowdfunding is different, and people may not be familiar with it, so use what you are already doing to promote your campaign. Also, create some compelling rewards to get people excited about investing or funding your project. People love to be acknowledged. Anywhere you can do this is a great reward.