You've had that next billion dollar idea and you're going to raise your first $25k via Kickstarter, Indiegogo or another crowd funding site to make it a reality.
Simply put, crowdfunding is the process of asking the general public for donations that provide startup capital for new ventures. Using the technique, entrepreneurs and small business owners can bypass venture capitalists and angel investors entirely and instead pitch ideas straight to everyday Internet users, who provide financial backing.
Competition for crowdfunding dollars is already high, and destined to become even more competitive as time passes. Launching a project on a crowd funding site is far from a guaranteed success – less than half of the Kickstarter projects reach their funding goal, and around 12% don't receive a single pledge, therefore no matter how great your product is you're going to need to get web traffic to your funding page or you are going to struggle to raise the necessary capital to get your project off the ground.
Phase 1: Build your audience
The most successful entrepreneurs know the power of leveraging other people's money to get to where they want to be. Well the best marketers know how to leverage other people's audiences to do that too. You want to start this phase at least 3-4 months before you plan to launch your funding campaign.
It’s important to write down who your ideal customer is and who your ideal funder will be. I like to create personas based on real data about customer demographics and online behaviour, along with educated guesses about their personal histories, motivations, and potential concerns.
Try to answer the following questions while you write out your personas:
- What are the biggest problems they are trying to solve?
- What do they need most?
- What information are they typically searching for?
- What trends are influencing their business or personal success?
Next, develop a profile of each persona’s typical online activities. You know who they are and what their needs are, now think about all the ways they research a potential purchase on your site or on others.
- What do they do online? Do they read blogs? Are they active on social media?
- What kind of search terms do they use? Are they on email lists or RSS subscribers?
- What kind of information do they tend to consume online? Infographics? Videos? Podcasts?
Start a blog – and I’m not talking about some shoddy free website such as Weebly or Blogspot. At the end of the day you want people to trust you enough to hand over their money so invest some of your money in a domain, web hosting, premium theme or custom web design. I would highly recommend that you create a self hosted WordPress website for your blog and if you need help setting this up then read this guide on how to create a blog or this one
Create a landing page you need a page on your new website that will encourage people to sign up to join your email list. There are lots of free and premium WordPress plugins that can do this for you. I also recommend using MailChimp as it’s free for your first 2,000 subscribers. I would offer something for free in order to encourage people to sign up to your list such as an eBook or auto-responder series related to your product.
Create a paid e-book & offer 100% commissions to big email list owners. You probably think I am crazy suggesting that a) you charge for something you would normally give away and b) you give all the money to someone else.
Remember, we’re not trying to make money: we’re trying to get them to hand over their traffic. You have to remember your motives, first and foremost. You need to offer someone with a large list a huge carrot to do you the favour of emailing their list and 100% commissions will really stand out from the crowd.
Secondly, we want people who will be happy to invest in your campaign at launch on your email list and thirdly people will prefer to pay for something than get it for free. We also want to make a product that’s cheap enough to convert very highly with their list.
Now that you have the emails of these people, it is time to deliver value, and really wow them with your brand.
Join the online communities of your target audience, I would highly recommend that you sign up to sites such as Facebook, Twitter, Pinterest and Google+ as the bare minimum. Find out who the key influencers in your niche are by using tools such as Followerwonk, Klout or Find People on Plus. You want to develop relationships on your social media platforms with the key influencers as you want to use their audiences as springboards to bring more traffic to your blog. I would also look into joining a couple of niche related forums and community sites such as Hacker News and Reddit..
Create useful blog content based upon your persona research. Write articles relating to their pain points, frustrations or concerns and offer helpful tips or advice. Make sure your blog post’s have a call to action to encourage your visitor to share it or to sign up to your email list. Spend time crafting awesome titles as this will increase the likelihood of your content going viral.
Create an infographic (or an instructographic). Visual content is a great way to get the attention of bloggers and Pinterest users, which means more traffic, links and brand opportunities for your campaign. If you create something truly remarkable with a great hook you will see a high return on your investment.
Guest Blog, Guest Blog, Guest Blog, this is truly a great way to get your project in front of new audiences. Buffer built up a user base of 100,000 users by guest blogging on popular social media websites for 9 months. I’m not saying that you have to commit to Leo’s 3 guest blogs a day schedule but aiming to write content for other blogs on a regular basis will help your campaign.
source: Success Nexus
A tactic I like to use when guest blogging is to let my prospect know about the volumes of traffic and social shares I was able to generate the last time I wrote about that particular topic. This gives them an assurance that I only write quality content and know what I am doing when it comes to promoting it.
Build an outreach list, now that you have an understanding of the online behaviour of your potential customer base you want to begin to research blogs, newspapers and other websites that will be able to send a large volume of traffic to your own web properties.
Use journalisted to find the contact information for bloggers and journalists
Insert the keywords related to your product into Google Reader and find the blogs with the largest RSS subscriptions and then input them into Buzzstream’s free Blogroll tool to find who they link to as well.
Once you have your master list of blogs, I like to use the contact finder from Citation Labs. You have to pay for the amount of bandwidth that you require but I can run a list of 600-700 blogs through the site for about $20 – and considering the amount of mind numbing time it will save you its well worth it. If you want to find some more outreach tools to help you find contact information then I recommend this article by Adam Connell.
It’s also worth your time to sign up to guest blogging and blogger outreach communities such as MyBlogGuest or any of the other sites in order to find places that might be interested in writing about you or publishing your content. You can also use tools such as Open site explorer, SEO Spyglass or ahrefs to find out who is already linking to your competitors.
Promote your content on your social media channels and contact some of the bloggers and key social media users to help you share your content with their audiences. I would recommend that you spend at least 4 times the amount of time you spent creating your blog post or infographic in promoting it. I like to use Buffer to schedule my posts to go out 4-5 times on the day I publish them. You can also use paid traffic to promote your content such as Stumbleupon paid discovery or Reddit ads.
If you have carried out all (even most) of the above tactics above you will have created an highly engaged audience and a set of influential fans who will be ready to support you once your launch goes live.
Phase 2: Setting up your Funding Campaign
It’s important to set a realistic target for your project, very few projects with funding targets over $100k have ever been successful on Kickstarter. It’s important to think long and hard about how much you need to raise to fund your project and to pay for all the incentives that you plan to offer your backers.
Offer unique rewards to your backers. A Crowd funding community donates because each member wants to feel like he or she is part of the project, therefore if you decide to offer t-shirts or stickers include the words backer or supporter. Offer once in a lifetime opportunities such as including your backers names in the credits or on your website, and for larger donors why offer them the opportunity to come to see the project in development or exclusive access to the launch event.
If you try to launch a crowd funding project by just asking for contributions and not offering anything of tangible value in return, you’ll very quickly discover that crowd funding isn’t like running a political campaign or charity fundraiser. Few people will give you money just because they like your project. Some generous souls might, but the majority of people you want to attract expect something in return – hence the need to incentivise potential backers by offering goods or services in return for their contributions.
To date the most popular pledge amount is $25 and the average pledge is around $70. Small amounts are where it’s at: projects without a reward of $20 or less succeed 28% of the time, while projects with a reward of $20 or less succeed 45% of the time.
And if you are feeling generous why not consider offering a link to your generous donors in return for a payment?
Set a realistic deadline Kickstarter campaigns lasting for 30 days have a 35% chance of meeting their funding goals where as campaigns lasting for 60 days only have a 29% chance of success. It’s important to take this into consideration when you are planning your campaign launch.
Create a Press release and video, once you have your launch date planned in it’s time to craft a press release. It’s advantageous to create a video, screenshots or any other rich data that can be bundled into your press release and make it stand out from the crowd.
Have a video on your landing page – MWP Digital carried out research on over 7,000 Kickstarter projects and found that you were 85% more likely to reach your funding goals with a video than without.
Obviously there are many aspects to consider when creating a video for your crowdfunding campaign but clearly an up front investment of time, money and research is going to have a considerable impact on whether or not you reach your goals.
Decide upon your funding goals – if your target is $10,000 then you need to be achieving $2,500 per week. It’s much easier to raise funds in the first few days of the campaign so you may set a goal of $4,000 for the first week and split the other $6,000 over the next 3 weeks.
Phase 3: The Campaign is Live
So, you’ve made it to launch day! This means you’ve been promoting for a few months and have amassed a sizable and engaged audience.
Guest Blog some more; reach out to the people who sent you the most referral traffic to your email list and write another guest blog for them. This time instead of them linking traffic to your website landing page, ask them to link to your crowd funding campaign. Don’t forget to promote your guest posts.
Let your audience know. Email your list, tweet your followers, announce it on your forums and blog. Let everyone know your campaign is now live.
Send out your press release, remember that outreach list you created, now is the time to email everyone on that list. If your prospect rejects you or does not respond to a pitch it is in your best interest to follow-up once and let it go. It’s a good idea as you carry out your outreach to offer larger blogs the opportunity to interview you or to use other good press as social proof of your campaign. It’s unbelievably tacky to use a template email for blogger outreach.
Provide regular updates to keep your audience informed of what is going on. Be enthusiastic and let people know how much money you have raised every couple of days, highlight any positive press you have received as this may encourage people to share it with their networks.
Praise your big backers publicly. A little bit of ego rubbing never hurt anyone, plus it may encourage your other big backers to donate more or encourage those who are sat on the fence to donate. Only reserve your public praise for the big backers as it will become the norm and will not stand out as much.
Monitor your performance versus your goals. If your campaign begins to fall behind your goals then you could be in trouble. Many crowd funding sites are all or nothing so all that hard work could mean that you end up with nothing. The best thing to do is to increase the frequency of your communications and offer extra incentives to increase traffic and funding to your campaign. If you are running a Kickstarter campaign then you can use a service like Kicktraq to monitor your project and get more in depth insights.
Ready to get started? I sincerely hope that you’ve found this guide to be of use. Now fasten your seat belt and get ready to go to work.