For the last couple of years, crowdfunding has been the funding method of choice for many small businesses and entrepreneurs. It is a very low-risk way to generate liquidity for businesses and projects.
It is low-risk for the investors (as most will invest small amounts), and it is low-risk for the creators of the project, as their time will be the biggest investment made. Not only is it a good way to generate funds, but it is also a fantastic way to measure interest in a potential product.
Like everything, there is a right way and a wrong way to crowdfund, and there are a lot of ideas that start off strong but lose momentum and never reach their goal funding.
Joseph Jedlowski is an entrepreneur that has experience with every form of fundraising, traditional and modern alike. He has seen and done it all, so he knows what works and what doesn’t.
We talked to Joseph Jedlowski and asked for his opinion on the best ways to have a successful crowdfunding campaign and launch your next project with this modern method of investment.
There are a lot of crowdfunding campaigns, with many more being added every single day. Because of the oversaturation of campaigns, yours has to stand out from the crowd if you want investors to choose it.
One way to do this is by having a detailed plan of action for your project. Let your investors know how you plan to make the project succeed and why you need their money to do so.
This will give them the confidence to invest in your project.
According to Joseph Jedlowski, you need to communicate with your funders every step of the way. Communicate with them as they are investing, and after you have reached your goals.
Tell them how your project is going, what milestones you have set, and whether or not you’re reaching those milestones. Just like before, this will instill confidence and legitimize your project.
Jedlowski says that you have to invest in a website. If you do not have a website, your project will not seem legitimate and it will turn potential investors away.
There are many crowdfunding campaigns that burn their investors and do not deliver on promises. These campaigns have left crowdfunding investors wary and have given them cold feet.
A professionally made website shows investors that you are serious about your product and willing to invest your own time and money into its success.
You should offer incentives to those who fund your campaign. Joseph Jedlowski recommends having the incentives scale based on the amount donated to your project.
Make sure that your awards are something that will interest your potential investors. Put time and effort into thinking about these rewards so that your investors know you care about them and appreciate their funding.
If you offer something small and bland then you may even insult your investors and will turn them off of your project.
Jedlowski insists that going viral is the easiest path to a successful crowdfunding campaign. Creating a viral video isn’t as impossible as it may seem. You may look at this Jimmy John Shark video here as an example.
You just need a quality video that provokes a real emotional response from the viewers. Then you can work with influencers and other big names in your target audience and have them share your video around. While it can be difficult, going viral will definitely make your campaign a success.