by Michelle Delio
Crowdfunding competition is fierce. There are thousands of great projects, all clamoring for the attention and financial backing that you need to launch your own project. To meet your funding goal, you need to set yourself apart from the pack. Here’s how:
1. Tell a great story
Project pitches that include videos (preferably featuring you and your team) are much more likely to be successful. But don’t stop there. Think about other ways to delight and inform your audience. You might want to use infographics, offer downloadable project plans, customized maps, e-books, or do a presentation with sock puppets – whatever helps you tell your story.
2. Make it personal
Tell a story that people can identify with and love. Make it about them. Funding someone’s innovative product isn’t as inspiring as supporting a cherished community, cause, or concept. Center your pitch on the big picture benefits you’re offering to potential backers. Help people understand how funding you will help them achieve their own goals. Crowdfunding depends on the crowd, so please the crowd that you’re targeting.
3. Build belief
Convince your potential benefactors that you are the perfect person to do this project. Tell them about the time and effort you’ve already expended. Share your market research, a bit of your business plan. Have you won any awards, are you a proven expert in this field, do you have a successful track record of bringing products to market? If your resume isn’t likely to bolster confidence, scale back your expectations and your pitch. For example, rather than asking for $50,000 to fund the entire project you could request $5,000 to help you to promote the finished project. Give them a champion to believe in and support.
4. Provide an experience
Great rewards drive the success of many crowdfunded ventures. Offering your backers something of real value that that money can’t buy will spark interest. You could invite sponsors to join you on your road trip, give them a cameo role in your creation, provide an opportunity to collaborate with you, or offer access to your team’s expertise. (Check the rules on your crowdfunding site first, some types of rewards are prohibited.)
5. Be everywhere
Give your project its own dedicated website, Twitter feed, Tumblr, YouTube channel, Facebook page, and Instagram feed. Don’t just post progress reports. Share information of interest to your project’s target audience. Document what you’re learning to help others successfully fund their own projects. And don’t restrict your marketing efforts to the digital world. Give a party or a free workshop. And never leave your house without a pocketful of business cards sporting your project’s crowdfunding site URL.
6. Don’t forget to verify
If you’re taking advantage of the Rule 506(c) laws that allow you to offer equity interests or upside in your company or project to investors, remember that you can only accept “accredited investors” into your crowdfunding campaign. Accepting investors without verifying them is illegal, and your company or project could be heavily fined or even banned from advertising for investors in the future if you don’t abide by the regulations.
You have to take “reasonable steps” to verify your investors, which you can do by using a third-party service like VerifyInvestor.com. You’ll also want to talk to an attorney in order to make sure you fulfill some of the other requirements that Rule 506(c) imposes.