It wasn't that long ago that Parrot Dog raised 1 million dollars in 7 hours crowdfunding on Pledgeme, and as they ready for their next crowdfunded equity raise Kate Drane, Senior Director of Outreach for Tech and Hardware at crowdfunding giant Indiegogo hit town.
The natural choice to spread the word about all things crowdfunding, Kate joined Indiegogo after successfully launching a mobile beer canning business "The Can Van", itself funded by the crowd. Thanks to The Project and the U.S Embassy Kate arrived on our fair shores ready to deliver master-classes on the art of crowdfunding, and we managed to wrangle some time with her to share her secrets not only with our residents but as it turns out - with you.
Kate's visit comes at the perfect time, in 2015, crowdfunding generated US$34Billion and was predicted to surpass Venture Capital by 2016. And with the rise of equity funding on sites like Indiegogo, 2017 is set to be a watershed. By 2025, the World Bank Report estimates that global investment through crowdfunding will reach $93 billion.
Top 5 crowdfunding tips
Connect with an audience that cares
Your first 30% of pledges are likely to come from your tight-knit network so get them ready and excited. As well as your friends, family and coworkers Kate suggests building out qualified lead-lists in advance that will enable you to make the most of that first push. You can do this by running low-spend facebook advertising enticing people who are interested in learning more to sign up to a database, by talking to local business groups and creating engaging organic content through social media.
Keep conversation rates front of mind when building databases
A qualified lead list or email database converts on average at a rate of 5% - 10%, so approaching your campaign with this in mind is useful. This may mean you delay your campaign to build an excellent lead list, or that you work harder on your earned media and adverts. For more on that head over to Indiegogo blog.
Strategise, plan and then push play
Crowdfunding campaigns that raise 50% of their funding goal in the first 48 hours go on to raise more money than those that do not. A connected, and engaged audience will help here, but so will putting time and effort in before your funding campaign goes live. On average, successful campaigns involve six months of forward planning. Approached like a typical launch program, these include everything from teaser messaging through to press and how updates can and will be handled. The more organised, and the more effort you put into getting people on-side and then keeping them there with ongoing comms the better you will fare.
Communicate in a way that engages multiple kinds of people
Building out campaign pages? Keep in mind that some people love video, some people love graphics and images, and some people love copy. Try not to forgo one way of communicating, and instead work in broader strokes that incorporate all of the above so that all your bases are covered.
Think about your audience when crafting your copy, or selecting the music for your video. What would appeal to them, what would entice them to say yes? And don't be afraid to spend time or money in creating this video content "many people see this as a strategic piece of communications they can use on an ongoing basis", making a larger video that can then be cut up in various ways for different parts of the campaign.
Do not just ball-park the money element of this
Build out a campaign based on what you need to make your dream possible, knowing full well that "if you make that value too high, it will be hard". Kate pointed out that the goal amount is so critical, and it needs to be created with the ability for your business to say with confidence that you can deliver what you promise on that amount, while also keeping it low enough that the barrier to reaching that funding goal it is not too high. On average, campaigns that do not reach 30% of funding within the first days will struggle to complete their round.