1 Grow Your Network. Connect. Connect with other members by adding them to your network whether they’re investors, other entrepreneurs or experts on the community. As a startup that needs to engage the crowd and get them involved you’ll often have to make the first move and reach out to others. Do unto others as you would have them to do unto you. In other words, review other startups, comment and assist. Simply adding a new connection can get them to view your startup page go through your plan and get your startup on their radar. Only after they notice you, are they going to start to comment or express interest in what you’re up to. With every member you add to your network you’re also adding a potential fans and advocates for your startup! Bring Your Own Crowd It takes a spark to ignite a movement. The best way to light that spark is bring your own little crowd of family, friends and known supporters who can start supporting your startup, get discussions going and set the stage for others to follow suit. The more initial support you can gather from your closer internal network, the quicker you can get others to join in and gather momentum. Promote Your Startup Page & Crowdfunding Initiative The success of a crowdfunding campaign is often the result of the outreach you have and the awareness you can create. The more people you can reach out to and direct towards your crowdfunding initiative and startup page the better. Within the GrowVC community there are channels such as the discussions section, follow members options, post updates to your page and more. Outside, there are channels like Twitter, Facebook, Linkedin and your own blogs where you can talk about your crowdfunding effort, place banners, badges and draw as many people as possible. Involve Everyone Bring your investors online. Show your investors to the crowd. There is nothing quite like the confidence of a few investors in your effort to create confidence among the others. Ask for advice, consider what the feedback is, get others involved. All other things being equal, members would prefer to fund a startup they feel closer to or a part of than one they don’t connect with and feel involved in. Make Them An Offer They Can’t Refuse There is always a little extra you can afford to give away for free (or at a discount) to those who are willing to support your startup. Whether it’s a free sign up to your application, an exclusive chance for a first peek into the product, a discount voucher or something which provides incentive for others to offer their support or make that investment in your venture. Even if it’s more of a token which makes the crowd feel a little special for being a supporter, it shows that the entrepreneur and startup care about their stakeholders and those that help them in their journey. That in itself, can win you fans. With just some of these steps followed up on regularly and put into action, you’re on your way to initiating the crowd who may well be future investors in your venture! http://www.growvc.com/blog/2010/09/13/5-ways-to-initiate-the-crowd-in-crowdfunding/ 2 Keys include: 1. Great Pitch Clip 2. Creative & Unique Perks 3. A Specific & Transparent Use of Funds 4. Fun & Frequent Updates 5. Outreach to Influencers http://www.indiegogo.com/blog/2010/01/keys-to-crowdfunding-success-on-indiegogo.html 3 Know why your project matters If you're clear on why you want to complete it — and can convey this in your written description — you're likely to find a lot of supporters. "Oftentimes, the passion will be contagious," says Meece. Videos can be a great way to tell your story, he says. (The most successful fund raiser on RocketHub was an indie film maker who came away with $10,000). Give back Meece encourages those who raise money on RocketHub to offer their financial supporters something meaningful. A good example, he says, is an entrepreneur who put the names of her donors on a plaque in a tea shop that she upgraded using funds she raised on the site. "It's a matter of offering really cool, engaging things back in exchange for financial contributions," he says. Be realistic RocketHub, like some of the other crowdfunding sites, requires you to set a target date for meeting a funding goal you set. If you don't raise the total amount, you forfeit everything. As a result, it is important to set a goal that's achievable in the time frame you pick. For guidance, Rockethub offers a page to help you determine the difficulty level of various funding goals. Think hard about the length of your campaign, he advises. The optimum length for most projects is 30 to 60 days, but sometimes, a 75-day campaign will work well for bigger-budget projects, says Meece. "Any longer than that and the campaign loses its impact and urgency," he says. Ideally, they'll come away feeling like they got involved in a great project while there was still time — not ruing the day they friended you on Facebook. http://www.openforum.com/idea-hub/topics/money/article/how-to-raise-money-on-crowdfunding-sites-elaine-pofedlt 4 The Crowdfunding Manifesto consists of the three pillars of success: 1. The Project 2. The Network 3. The Rewards Each is equally yet uniquely important. When each pillar is strong, the probability for success grows. The Project Every person owes it to him or herself to build something great. Make sure your project matters - and remember it does not need to be big to be important. To truly make a dent in the universe, you need passion. Build a project that is worthy of your time and other people’s attention. Crowdfunding success comes from emotional connection – both to the project and to the individual/team leading the project. Stand for something and you will be noticed. When describing your project be sure to describe why it’s important to you. If the why is powerful enough for you, it will likely resonate with others. Be clear on the why. Make it the best project possible. A compelling project takes both emotional and intellectual effort. The Network Crowdfunding is based on trust. A Creative’s first-degree network - the family and friends - are usually the first contributors because the necessary trust has been established a long time ago. The second-degree network - the friends-of-friends and other acquaintances - jump in afterwards. They contribute after the right trust signals have been sent - i.e. after enough money is already in the tank, after a robust discussion has emerged, and after intimate communication is in place. The larger your network and the deeper your relationships, the more power you have. Most small and medium projects can succeed purely from the first and second-degree networks. You likely have enough connections take the first crowdfunding step (See Difficulty Levels). Large projects need the third-degree to fully fund. The third-degree network - essentially consisting of people who have no personal connection to you - are the most numerous and financially powerful group. Winning their trust - and thus their hard-earned money - requires work. It requires an introductory message that is personal, authentic, and that strikes an emotional chord. It requires regular updates, complete engagement, and full dedication. It is the ultimate sign of trust to give money to a (near) complete stranger. Your previous work and reputation as a Creative play a large part in that trust. It is difficult to predict how much impact the third-degree network will have. Consider it a “wildcard play” that becomes more likely if you have an exciting project or a large first and second-degree network base. The Rewards One of the key elements of a successful modern crowdfunding project is the Rewards Menu. This is a list of goods, services, and experiences that funders receive in exchange for participating in your project. The rewards serve as the foundation for the exchange – enticing people to contribute at various price points. Having the various price points is key to effectively monetizing your network. The different levels of rewards let all those who wish to be involved participate in your crowdfunding campaign - based on their financial means. The Rewards Menu should read like a good restaurant menu. Every reward should be fun to read and must contribute to your brand as a Creative. Think of what you can offer beyond the obvious – i.e. if you are a musician that can bake cookies you can tap into your culinary skills to develop original rewards. The rewards give power to your network and offer the opportunity to influence the creative process and end results. http://rockethub.org/page/manifesto-strategy 5 What is the key to crowdsourcing for money or 'crowd funding'? A focused project. I think we want to rally around things with specific goals. Making people feel like they are a part of something. This starts with a compelling story -- why I should support you -- and then a determination to spread the word. There is a great concept coined "Empowered Interactivity" by the writer Mark Hughes (from his book BuzzMarketing). Paraphrasing, "Create a mechanism where people have an observable impact, and it becomes their brand, their 15 minutes of fame, their outcome." If you already have a large social network, will it help you get funded more quickly? No question. Each person you know is an amplifier to each person they know. We all have a social network, and the key to crowd-funding is sculpting your project and presentation so that it amplifies past that first degree of your network. If it's compelling, people will forward it. What if you don't have lots of online presence before using KickStarter, how do you raise awareness and get funded? It might not be the sexiest thing, but email is still extremely powerful. Send a rallying cry to friends and family, encouraging them to forward along. Reach out to relevant blogs and organizations. Become a marketer. You can also go small. One of our first projects (and we are only starting our 2nd week) was a programmer named Dan Phiffer who raised $99 to build a Wikipedia iPhone application. The funds will go to pay the Apple's iPhone application fee. He was fully funded in a few days. What can people do to make their idea stand out overall? Video! It's not required to fund a project, but we strongly encouraged it. Doesn't need to be Kubrick, some of the best video are just people talking about their projects. Their passion comes across, we can connect. Along those same lines, offering benefits or rewards that have charm or value is a huge boost. If you just put your hand out, it's not that interesting. Everyone can offer something in return. One great example is a project by Earl Scioneaux, a musician from New Orleans, who is offering prospective backers some home-cooked gumbo and music theory lessons. His rewards really connect us to his project and make us feel like patrons. What are some of the projects currently being funded? They cover all the bases: group of New Yorkers self-publishing a book where everyone gets a page, a photographer exploring Iceland, a writer funding travel for a regional cookbook, a NYTimes crossword puzzle creator funding the release of Brooklyn-themed puzzles. The day after we launched, two projects were already completely funded. That really blew us away. Five projects have been funded in the first week. Five more are quite close. The smallest funded was $35, and another is already close to it's $3,000 goal. Several new projects are attempting to raise $10,000. Who is likely to use the site? I think projects will mostly be started by: people with particular ideas that have been burning in their hearts for awhile; those people that have ideas falling out of their heads; and people in creative industries that no longer want to wait to be tapped on the head. Then the second group are the audiences and networks of those folks. We think, eventually, that's almost everyone. http://www.huffingtonpost.com/juliette-powell/crowdfunding-how-to-kicks_b_198376.html 6 http://www.spannerfilms.net/how_to_crowd_fund_your_film 7 Five Golden rules of Crowdfunding I can not tell you if my experience of Crowdfunding is the norm, but here are a few things I have learnt from funding OpenIndie: 1. Ask for what you need Make a budget and be sure that you can do what you need for the sum you’re setting as your goal. The most important thing when Crowdfunding is being sure that you can deliver on your promises. 2. Be realistic This one takes its lead from number one. Can you actually do this? Do you have the skills? Are you sure? Don’t promise what you can’t deliver and never under deliver on your promises. 3. Set a unit price and set a total unit goal People really respond to A) being part of an exclusive group and B) the need to reach a goal which isn’t financial. We asked for 100 filmmakers to donate $100. You could ask for 100 Magicians or 50 Accountants or 200 used car salesmen. Whatever your niche, focus upon it and ask yourself what appeals to that niche. 4. Pre-sell your product Presumably your business has a product. Ours is film profiles, yours might be perfume, books or bookkeeping. Whatever it is, offer those people buying into your exclusive club that product if the campaign successfully funds. Everyone who donates $100 or more gets our exclusive funders special edition perfume, for example. 5. Be open Transparency is straight out of the Web Business 101 classroom but it really can’t be said enough. Be open and honest with those giving you money and nothing will creep up and bite you on the ass. http://thinkvitamin.com/web-industry/how-to-crowdfund-your-startup/ 8 http://www.ehow.com/how_6935134_compare-crowdfunding-websites.html