The ABCs of Crowdfunding: P is for The Patron-Age

So Michelangelo says to the Prince: “Whattup, Prince. It’s cool that you dig my sculptures and commission me to do one every five years or so, but I still gotta pay rent, go for brunch and pick up my art supplies in between commissions. That’s a lot o’ chedda’, and I need to make it rain!”

If only Michelangelo had a DeLorean, he could’ve taken advantage of a new philosophy of independent cultural enterprise that relies on the direct, regular and ongoing relationship between artists and their paying fans (or, as Michelangelo would’ve referred to them, patrons).

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Crowdfunding ABCs: G is for Goal Setting

We all know that proper goal-setting is a critical part of your crowdfunding campaign success strategy. There are a ton of great posts (like this one) on how to set goals, so I’m not going to belabor those basics.

On this subject, however, there are two concepts I’d like you to ponder in a bigger sense when you’re strategizing for your campaign.

(1) One goal? S T R E T C H it out. Consider the strategy of enticing contributors to reaching beyond your original goal with multiple, or stretch goals. Essentially, a stretch goal refers to any target set beyond a campaign’s original design, as described by CrowdClan’s Michael Ibberson. In other words, he says, it is not necessary for a campaign to achieve their stretch goals in order to cash-out. Some of the biggest ever crowdfunding campaigns have employed stretch goal strategies.

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Don’t try this at home, kids!

So how does it work? Continue reading

Crowdfunding ABCs: F is for Finance First

We love to jump into new things, especially when it comes to MAKING MONEY, and crowdfunding is no exception. I’m guilty of it myself.

You can be successful (and 142,647 Kickstarter projects as of today have been to the tune of $3.6 billion!), but it isn’t a slam dunk. On average, 36% of Kickstarter campaigns succeeded, and Indiegogo’s success rate is even lower: about 34%. The reasons for campaign failures vary, but one thing you CAN bet on is that if you don’t prioritize careful financial planning in advance of your campaign, you run a high risk of not achieving your campaign goal.

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Before you get too discouraged, however, let’s look at some other stats: While 10% of Kickstarter projects finished having never received a single pledge, 80% of projects that raised more than 20% of their goal were successfully funded (meaning they reached their goal, as Kickstarter is a fixed funding model, requiring you to make your goal to receive funding). And let’s not forget that one of the reasons for Indiegogo’s low percentage of successes is that they will accept any project; unlike Kickstarter projects which are curated.

Giving yourself the best chance for success in crowdfunding means making sure that crowdfunding is the best financing option for your project or company. Financial planning for your first crowdfunding campaign (whether rewards-based for a project, or equity-based for a company) starts way before the actual campaign—or at least it should.

You need to be able answer four key dollar-related questions before you even decide if CF is your best option, and if so, to design your strategy:

  1. WHERE are you going?
  2. HOW MUCH do you need?
  3. WHY do you need it?; and
  4. WHAT KIND of money do you need? Continue reading

The ABCs of Crowdfunding: A is for Ambassadors

The strength of your body is your core: a group of muscles in the center of your body that keep you healthy and moving forward. Your campaign’s “core” is your inner circle: Your family, friends, colleagues/co-workers, and anyone else to whom you are close enough to ask them to help advocate for you and your campaign (in addition to contributing, of course!)

 Here are some ways to engage your core, turning them into social media and marketing ambassadors:

Have a launch event. A launch even is a great way to collect, inspire and activate your core group for the course of the campaign. Invite your inner circle of 50 or so folks who you believe will not only want to support your crowdfunding campaign with perk purchases but will also be able to help you promote the campaign. Asking this core group to be marketing ambassadors for the campaign is your responsibility, but so is making it as easy for them to help you as possible:

  • Give them assignments. At the event, suggest some ways that they can become part of your tribe, and help you over the period of the campaign (4-6 weeks)
  • Make their tasks simple and varied (nothing that takes more than a few minutes each).
  • Put the tasks on a checklist and hand them out at the event, but also tell them they’ll each get an email version, or maybe tell them you’ll email them a task each day that will take only a few minutes. (You can do this through the platform updates tool, for example, after you’ve added them to your campaign email list.)
  • Treena Wynes offered a membership and created a tribe based on her food theme. (Indie Ink Publishing, 2013).

    Treena Wynes offered a membership and created a tribe based on her food theme. (Indie Ink Publishing, 2013).

    Give your allies a tribe name. This allows you to build a membership or subscription around a brand or entity. (We named our Eating Myself Crazy author’s tribe The Moody Foodys. Their checklist looked like a grocery shopping list. The whole event was based on healthy food. A local radio talk show host who was a friend of the author came and together they made some recipes and talked like they were on air. It was a blast and people got to eat the food. The host was hilarious.) This led to the idea of a perk that was a membership/subscription to the author’s newsletter with healthy eating tips and recipes.

  • Sharing. Tasks should include ways in which the tribe can share news of the campaign and ways others in their network can become involved. Example: “Share the campaign on FB, with a header note that says “I contributed to Joe’s awesome crowdfunding project for Mayerthorpe’s new community park project. It’s really important to him. He’s a great guy, and I hope my friends will consider contributing to it too.” This type of word-of-mouth testimonial is solid gold. Create branded content in the form of tweets and Facebook posts that you can send them on a daily basis to make it easy for them to share.
  • Reward for work. Maybe there are 10 tasks spread over the 4 weeks and those who provide evidence of doing all the tasks get some kind of special reward at the end of the campaign.
  • Incentives are GOOD. If you can offer your tribe something that nobody else gets and that doesn’t cost you much to provide, you might get even more enthusiasm.