Business & Finance

Getting Started with Crowd Funding

Getting Started with Crowd Funding
September 30th, 2015
Author: Economic Voice Staff

One of the most innovative ways to build a business in today's world is to leverage the power of the community through crowd funding.

Crowd funding is a way to allow potential customers, backers, and other supporters to directly fund your desired project instead of going through traditional funding methods to get your project off the ground.  Best of all, if your project is a success, you have an audience already in place to receive your products or services.

The first thing that needs to be done is a crowd funding website needs to be selected. Plumfund is a great place to go to get started, since they don't charge any fees to join the website. There is a nominal fee for processing funds from sources such as credit cards, but aside from that there are no fees to use the service. Plumfund also supports crowd funding for non-business purposes such as helping a relative who is ill or allowing friends and family to band together to help to buy a car for a college student.

Sterling 6 (PD)

After you have created your account, it is time to determine what you are trying to fund.  This will vary from person to person, but it is important to have a pitch that showcases what you are trying to do and why it will be beneficial to the donor to help you achieve your goal.  It doesn't matter if you are trying to write a novel or plan a wedding – it is important to make your prospective donor feel like they are a part of the project.  This is what will convince the backer that they are getting something out of the project in most cases, which is what will convince them to fund you instead of someone else.

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Once you have decided on the project you will be crowd funding, it is time to utilize the internet as a tool to attract potential donors to the project so that they can get it off the ground.  For almost all projects, Twitter and Facebook will be useful tools that you will want to leverage, and for other projects Pinterest and Instagram will be useful to add to your mix as well (ex. Photography projects).  If you are trying to start a business, LinkedIn is a useful social media channel to utilize as well.

Most crowd funding websites have tools baked into the platform to do this from a single pane of glass.  From your project page you can access the more common social media channels to send posts, and your backers can use these buttons to share among their own social channels as well.  If you really want to get deep into managing social, Hootsuite is a great tool to consider, but for most the dashboard will be sufficient.  Managing your project page is going to be how you bring success to your project, so be sure to give it your all!

This is a great way to get started, and once you are off and running, be sure to work with friends and family to act as the starting point to spread your campaign.  Be sure to take advantage of your crowd funding platform, and don't forget to use the tools at your disposal to communicate to your backers.  Remember, that without your backers, your project won't have the funds needed to get off the ground, so always think of the people that you are reaching out to assist you with your project.  Only by thinking backers first will your project be able to be successful.

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