How to run a successful crowdfunding campaign

You have identified a need in an audience, and you came up with the best concept for a business endeavor, but you are struggling to make ends meet and have no idea how to finance it? That is OK. If you convince enough people that your idea is fabulous, they may give you money! This is a step-by-step tutorial on how to run a successful crowdfunding campaign.

Trying to figure out if you have what it takes to run a business may start when you need to make things happen, but you have no resources to do so. Is the problem all you can see? Or is that just the first stage on a path towards success, which means that you stay focused on finding solutions? And do you find the solutions?

OK. We have established that you have no money. Here is the big secret, though: that never prevented real entrepreneurs from starting a business. If the idea and/or the person behind it is interesting enough, the money will show. Trust me on this.

I am starting my own art studio and art prints business and not so long ago this idea was just that: a vague concept, a dream. I had no money. I had lost my job to Covid-19. My unemployment check did not even get to end of the month. It took me 90 days to raise enough money to register my brand internationally, using that wonderful tool called a crowdfunding campaign.

Crowdfund your way into your dream

Do not try to finance your whole start up with a crowdfunding campaign when you still have too little to go on. Figure out what is urgent. What do you absolutely need to do right now to get you going?

After you have thought about it for a while, you need to start figuring out in what platform you are going to run your crowdfunding campaign in. There are quite a few. Some of the oldest and better known are Indiegogo, Kickstarter and GoFundMe.

All of them work in a similar way. All of them are reward based, but there are some differences in the fees they charge, which are usually only collected if the campaign is successful. Each one is embedded within certain communities, whether for geographic reasons or depending on your area of expertise. Do your homework and figure out which one works better for your business/potential audience. I am Portuguese, so my campaign ran in PPL | Crowdfunding Portugal, at https://ppl.pt/giselacruz.

Reward based

By now, you have chosen your goal, read the rules of the platform you prefer, pondered over the fees, and started looking at some crowdfunding campaign examples. Right? It is time to think about what you can give back to your contributors.

A crowdfunding campaign is not charity. It is reward based. People do not just give you money. They give you a certain amount of it in return for something you will give them. These are probably your first customers. You must be nice to them and figure out what you have to offer. If you can start developing and testing your product right away it is even better right. These people are going to believe in you when no one else yet does. They are the perfect test subjects. Most of them will answer you, support you… They will care.

Is there a reward that makes sense to present as an example of your business? Can you start producing it right away, even in a small and tentative way? Can that one reward become not just one, but several similar rewards of different sizes or different finishes or whatever other difference you can come up with? Make a list of rewards, with several scales of value.

To reward the lowest amounts previewed you can get away with just sending a personal thank you note and scale up to a public thank you note in your social media for the next reward of higher value. From then on you must offer something more meaningful.

From my example:

1. to those who would give me from 5 to 10 euros I would thank them privately (via SMS or Direct Message);
   
2. to those who would decide to contribute with 10 to 20 euros I would thank them publicly (in social media and in the platform);
   
3. to those who would be generous enough to give me from 20 to 40 euros, besides the public thank you note, I would give them a small (A5) print of an original random artwork;
   
4. to those who would contribute from 40 to 100 euros, besides the public thank you note, I would send them a medium size (A4) print of an original random artwork;
   
5. to those who would choose to help my project with more than 100 euros, besides the public thank you note, I would send them a big (A3) print of an original random artwork;
   
6. and, finally, to those who would be brave enough to choose the reward above 200 euros, besides the public thank you note, I would personally deliver a big (A3) print of an original artwork of their choice.

At the end I ended up sending every contributor a catalog of my work so they could choose their favorite to print. And most of the prints were delivered in person.

So name the amounts and the sizes/varieties of your rewards and figure out how you will deliver them. You can “overprice” those rewards a little bit, because these are people who will be available to invest in you and believe in you and they are willing to give a little bit more than what they are getting to help you out, but do not be greedy.

Math is your friend

The concept of your crowdfunding campaign should start coming together by now. So this is the perfect moment to start laying down some numbers. You cannot do “an estimate” of how much you will be asking for or figure out a “ballpark figure”. You really need to seat down and run those numbers thoroughly.

Which are they? Well, have you figured out how much you are really going to need to accomplish your goal? To the result you came up with, ad the cost of the production of the rewards and of their shipping. Now, this is the only thing that actually is an estimate, because you do not know how many people will give you what amount. To do this estimate, you must have in mind how many people it would take to fund your goal if everyone chose the lowest valued reward, and how many it would take if they all chose the highest valued reward. The right answer should be somewhere in the middle of those numbers, tending more to the first scenario. Finally, ad the platform fees. So, rewinding:

1. what you need to fund your goal;

2. what you need to produce the rewards;

3. what you need to deliver or ship the rewards;

4. the platform fees.

Sum it all up. And there you have it: the full amount you will be asking for in your crowdfunding campaign. You will have to explain all this very openly to your crowdfunding campaign audience.

You can do it

Time to scrap up a cheerful video. Even if, like me, your skills as an editor are not your best feature, you CAN make a video. It does not have to be perfect. It just needs to have the right tone and the right details.

Tell people what you need the money for. Be detailed in your plan. Talk about how you came up with the idea and where you intend to take it. Tell them exactly how much you need and why – you do not have to hide the fees and the production costs. Be forthcoming with everything. Show them your art or whatever legitimates your talent and the campaign. Tell them what you can do and why they absolutely need to back you up.

Do NOT beg. Do NOT plea. Do NOT apologize. Do NOT doubt yourself. Leave the victim, the cry baby, the neurotic version of you at home. People like winners. People want you to be a winner. They will only stand behind people that have decided to be winners. Humble, down to earth, honest winners. But also… Do not go over to the dark side and come off as an arrogant dumb *ss either.

Do it in one take talking straight to the camera. Do a super creative artsy movie. Do a stand-up comedy show. It does not matter as long as you follow “the rules”. Rewinding:

1. be forthcoming about your goal and how you intend to accomplish it;

2. explain your plan in detail;

3. make sure you come across as someone who is going to make things happen.

People need to know they are betting on “the right horse”. Now, go on. Post your crowdfunding campaign and let the countdown begin.

Human to human marketing

Are you active in social media? Are you a people’s person? Do you answer all your messages and comments? Well, you do now.

There is no successful crowdfunding campaign if you are not present and active in your social media throughout the whole thing. Get ready to find out how that friend whose profile you have not visited since that wild night out is. Keep in mind you will have to answer that strange neighbor if he asks you what you are up to. Even old girlfriends or boyfriends may come back to haunt you once your campaign start showing up in their feed because all your friends are liking your posts.

Yes, that is right. Once you start a campaign, you have a very defined period to make it work, so you better draw up a plan of cheerful and wining posts to divulge it and be present to answer everyone and about everything.

If you can make sure you gather a somewhat generous contribution right in the first few days, that would be perfect, because it would set the right (winning) tone for the rest of the campaign. Ask your mother shamelessly if you must. (Breaking your piggy bank is the very last resort!)

Broadcast your news

Every Monday (or Tuesday if you prefer, or Wednesday… it does not matter, just keep it steady and frequent) you will have to come up with “news” about your campaign. And then post that news in the crowdfunding platform (so you can send it to your backers) and in your social media.

Tell everyone how surprised you are with the success you are having (find a way to see a form of success in whatever is happening!). Or talk about how you are feeling with all the support you are getting. Or confess what dream you have already accomplished just by being in this process. What mark was just reached? A third of the funding? A half? Do you have a month of campaign? Did someone just give you a sh*t load of money? Celebrate all victories with your audience, no matter how small. It does not matter what it is as long as it has a positive spin (and is not a cold blunt lie, obviously!). It is all wonderful or, at least, you are seeing the silver lining in everything all the way to the end.

Remember: Do NOT beg, do NOT plea, do NOT apologize, do NOT doubt yourself. And, also, do not talk or act like an *ss. Ever.

Keep your promises and deadlines

Did you thank everyone who contributed right after they have contributed? Keep lists of who to thank. You can thank people more than once and in several platforms. Just make sure that list is up to date. And never forget to post it on the crowdfunding platform update page and send those updates to all the contributors you have already gathered.

Send e-mails and private messages. Tell friends and acquaintances what is going on in your life, why you are doing this and how important it is to you, even if they have already seen or liked your posts. Do not be pushy but be present. Remind them. Go through your contact list and choose a group a week to send those private messages to. Send them!

Do not be impersonal in those notes. Make sure you tell people how you feel and how important their contribution is to you, both financially and emotionally. Answer all questions truthfully, but never pathetically. Be you, but in a winner version, because you will not only need that attitude throughout the crowdfunding campaign, you will also need it throughout the rest of the lifespan of your project – that is if you want to have one.

Whatever you do, keep your word. Do what you said you would do when you said you would do it. Do everything exactly how your said you would do it unless you have a super good reason not to (that you will have to explain) or you are giving back even more than what you promised (which you will also have to explain).

Wrapping it up

If the campaign is close to the end, tell your audience how little there is to go and how it is now or never. Go back to those people who believed in you the most or the earliest and tell them that your goal is still within reach… Remind them again of how important it is to you to accomplish it.

If you can meet the difference to reach your goal wait until the very last few hours to do so. You can contribute to your own campaign, remember? Obviously, that is not the goal. Exhaust all your possibilities before you take matters into your own hands.

If you have already reached the goal, but the campaign is not yet over, do a round of posts and private messages telling everyone what going over the budget allows you to do extra. Explain that this or that is now – surprisingly! – within reach as well. Tell everyone how incredible it would be if you reached that new goal! Be exited. Explain to them how out of this world this new possibility is and how grateful you are. (It worked for me!) Keep the promotion schedule no matter what.

Throughout this whole process remember three things:

1. The crowdfunding campaign platform managers are your friends. They want you to succeed and are always there to help you with your doubts and to give you suggestions. Use them.

2. Your contributors are the first people who believed in you, so chances are they will stay in your life. Treat them accordingly.

3. This is just the beginning, and the success of a crowdfunding campaign is not indicative of the success of your business.

Winner either way

It does not matter if the goal was reached or not, at the end of the campaign you will send a personal message with a final thank you note to each and every one of your contributors. You will tell them what happens next and when it will happen.

If you did not reach your goal, you will most likely be telling them that they will get their money back. Inform them of how that will happen according to the crowdfunding campaign platform. If you did reach your goal, you will be telling them when and how they will be getting their rewards and how and when you will be putting your plan into action. Keep them updated always, but do not send them 10 emails a week (one, tops, is enough).

Keep your newfound audience in the loop even after the campaign has ended. These nice people are your first mailing list. Ask them if they would mind being the founders of your future company’s mailing list. Tell them you will reward them for that (with a discount, for instance) as soon as possible (you will have to keep that promise too!).

Whatever the result of the campaign, just keep going. This is just a steppingstone, and you will always have gained more than you could possibility have lost. Keep the people, keep the lessons, and keep the winning attitude moving forward.

Does this make sense to you? If you need help planning a crowdfunding campaign let me know. I can help. I believe in you. 😉