Crowdfunding is a way of raising finance by asking a large number of people each for a small amount of money. Until recently, financing a business, project or venture involved asking a few people for large sums of money. Crowdfunding switches this idea around, using the internet to talk to thousands – if not millions – of potential funders. Typically, those seeking funds will set up a profile of their project on a website such as those run by our members. They can then use social media, alongside traditional networks of friends, family and work acquaintances, to raise money.
How do you set up a crowdfunding project?
There are many ways to set up a crowdfunding project.
- Choose a platform – There are a lot of different crowdfunding sites to choose from, such as
Choose the platform that is right for you and create your project.
- If you are looking to fund a civic project that helps the local community in Hull and East Riding then Spacehive specialises in civic crowdfunding.
- Make your idea enticing – In order to get the attention of potential investors, be sure to have a short and snappy sales pitch and some great imagery or video content related to your idea. This will help you stand out.
- Offer good rewards for investment – With all projects, the rewards for investing are based on how much someone chooses to invest, but make sure the rewards are good. Don’t just expect a ‘thank you’ to be enough of a reward. Consider early access to the product or service, discounts and extra goodies that will show people they will actually get something back for their money.
- Have an appropriate range of investment levels – Some people will only want to invest a small amount, whereas others will be happy to provide a lot more (providing the reward is appropriate to their investment) so make sure you offer a few different levels of investment.
- Make it easy to share your project – Successful crowdfunding projects often do so well because investors are excited about the idea they have contributed to and want to tell others, so make sure they can share it on social media easily.
- Let people know about it – No matter how good your idea is, if you don’t tell anyone, how can they invest? Be sure to think about how you are going to get the word out, utilise social media, give networking a try, and definitely keep your investors updated on the progress of your campaign. Got some great news or reached a milestone? Let them know and there’s a good chance they’ll share the news, doing your marketing for you!