When it comes to getting a business off the ground, there will be many challenges that you encounter, the first of which is getting the funding you will need to succeed. Traditionally, aspiring business owners would have to approach investors and try to win investment that way, but things have changed a great deal in recent years. There are a variety of ways to obtain the capital you need to get your young business off the ground, one of the most popular of which is crowdfunding.
The list below offers some of the top tips you need to know in order to successfully crowdfund for your start-up.
1. Choose the Right Crowdfunding Site
The first step that you will have to take when it comes to crowdfunding for your start-up is to choose the right crowdfunding site. There are many different crowdfunding sites out there, some of the most popular of which include Kickstarter, Seeds, Indiegogo, and Crowdcube.
The majority of sites work in a similar style, but there are a few distinct differences, especially in terms of rewards and pay-outs. Think carefully about the most appropriate site before moving forward with your crowdfunding process.
2. Start Off Slow
Many crowdfunding sites, like the popular site, Kickstarter, work purely on an all-or-nothing basis, which means that if you don’t reach your target amount, then you will not receive any of the potential investment. If you are using a site like Kickstarter, it is important that you start with a small investment to ensure you are able to access the investment. Alternatively, you will need to choose a site like Indiegogo for a larger investment aim.
3. Offer Incentives
While you hope that people will invest in your business out of the goodness of their hearts or because they truly believe in your vision, it is useful not to rely on this hope alone. Offering incentives is a fantastic way to increase the investment you are able to receive from your crowdfunding campaign.
There are many incentives that you could offer for a potential investor. For example, you could offer people who invest above a certain amount an engraved brick that will be used in your business property. Alternatively, you could offer the largest investors some stock in your company or a trip around your workplace.
4. Write a Compelling Message
When it comes to successfully crowdfunding for your business you cannot assume that everyone who is investing will already know your mission for the business. To ensure you are able to achieve the investment goals, you will need to be able to persuade anyone to invest, no matter what previous knowledge they have in the subject. Toto do this, you will need to write a very compelling message to persuade a potential investor.
In your crowdfunding message, you should outline who you are and what you are doing. As with any elevator pitch, you will need to concisely explain what your vision is for the business. It is also useful to explain who you are to add a more personal touch.