Crowdfunding is an increasingly popular type of alternative finance, giving businesses a route to raise money through contributions from general and professional investors. It’s ideal for those who don’t wish to pursue traditional funding or have previously struggled in this area.
However, crowdfunding relies on people wanting to support your business. If you stand any chance of raising your head above the other offerings and raise your funding target, you need a whole host of people to feel compelled to invest and help you hit that target.
With more people cottoning onto the trend of crowdfunding, it’s tricky to stand out. This is especially difficult on online crowdfunding platforms, where businesses and projects are vying for users’ attention.
This makes it crucial for your campaign to generate a buzz and convince people to support you. Below, we have explained what this entails.
- Identify your brand presence
- Highlight the problem you’re tackling
- Showcase your solution
- Demonstrate the impact
- Ensure your story flows
- Share on social media
- Utilise incentives
Identify your brand presence
The first step to creating a compelling crowdfunding campaign is to emulate professionalism, coherency and a clear vision of your business. The best way to do so is to utilise branding, such as your logo, font choices and colours.
Incorporate your branding into your crowdfunding page, so people are immediately drawn to you. You will also want to have a set tone of voice that showcases your brand personality. The most crucial factor here is that the branding and language you use reflect how you want to be seen and the mission you are fighting. It should also make your business likeable.
This will create instant recognition and allow users to set expectations about your campaign, which should dictate whether they want to fund you or not.
Highlight the problem you’re tackling
Crowdfunding campaigns work best when they serve a greater good, such as filling a gap in demand, providing to a niche audience or helping a charitable cause. Due to this, the problem you are aiming to tackle through your crowdfunding will be instrumental in attracting funding.
The problem you are tackling may vary. If it’s a charitable cause, you will want to spend time describing the issue. If it’s filling a gap in the market, you need to highlight the repercussions of that gap and why it should be filled.
Whatever the issue is, you need to explain it clearly and highlight why it’s crucial – such as who it affects and the emotional impact. People will be more likely to fund you if the problem being tackled aligns with them – such as directly affecting them or aligning with their moral code – so aim to lean into their passion and make them genuinely care.
Showcase your solution
Once you have outlined the problem, you need to present your business idea as the solution. This is the focus of your crowdfunding campaign, so you need to clarify the value that will be created and why it is effective at tackling the problem at hand.
You will need to detail what you aim to do and how this correlates to the issue. This might include anecdotal evidence or industry research, especially if others have followed a similar route in other areas and experienced success.
Remember, your aim is to make people want to be part of your mission to overcome the challenge you face, so you need to instill them with confidence that your solution will work and drive long-term value so people will part with their money.
Demonstrate the impact
To strengthen your solution and why it matters, you need to demonstrate the rewards and impact you expect to see. This should directly relate to the problem you are tackling, such as how the people affected will benefit.
Include research, data, forecasts and statistics to prove the potential rewards and convince potential funders that their support will genuinely help to rectify an issue.
Remember that the impact and rewards you list should not just relate to your business but to the audience too. A benefit such as “this will help us increase profit by 20%” probably won’t make someone want to support you, but something like “decreasing carbon emissions by 10%” will appeal to those who want to do their bit to protect the environment. So, identify consequences that will most appeal to your audience.
Ensure your story flows
Above, we have listed the integral components of a great crowdfunding campaign: a problem, solution and impact. However, once these parts are put together, you need to make sure it creates a consistent, engaging story with a long-lasting effect.
Spend time ensuring your story flows and reads well, with the aim of convincing people to fund you.
It may be worth asking someone independent from your business – such as a trusted friend or business acquaintance – to proofread your campaign in advance so you can gauge their reaction and get feedback.
Share on social media
Once you have finalised your campaign and published it to your platform of choice, the next most significant step is getting it seen. The more people you reach, the more people that could become supporters. This may include sharing videos relating to your campaign.
One way to secure exposure for your campaign is to share it on social media. Social media platforms usually have substantial audiences, so by sharing your funding campaign on the proper channels, you can attract a larger audience and improve awareness.
As your campaign grows in popularity, more people will want to get involved to help fund you. When doing so, they may share their involvement on social media – especially if they are proud of the cause or solution they are supporting – which will generate further exposure.
You may also choose to share the campaign on your business website or relevant forums to attract more people.
Utilise incentives
A common obstacle in crowdfunding is making people want to fund your business. While a strong story and mission can help achieve this, some people may need an additional incentive to encourage them.
Utilising incentives is common in crowdfunding. In many cases, you many cases in exchange for their funds, they will own shares in your firm. In others, alternative rewards could include the likes of free products, exclusive discounts or even content in the form of supporter newsletters or social media spotlights.
As well as giving them more of a reason to fund you, this will help you build a valuable relationship with your funders and they will become loyal ambassadors who promote your business to others.
Conclusion
Crowdfunding can – and has been proven to – bring great success for businesses in the form of awareness and substantial funding. It can pair brands with interested supporters, allowing them to work together to tackle issues and reach mutually beneficial goals.
However, not every business will succeed. You need to have a reason that drives potential investors to want to contribute, and you need to make sure your campaign captures their attention.
By following the tips detailed in this guide, you will create a compelling campaign that stands out from the crowd and helps you meet your funding target.
If you want to learn more about crowdfunding and whether it’s the right fit for your business, including how to increase your chances of success, we can take you through the process.