There’s no doubt that raising capital as a startup can be challenging at the best of times, but doing so in the midst of a pandemic is another story. That said, if we’ve learned one thing over the past few months, it’s that humans have an innate ability to adapt. The millions of individuals who are successfully working from home having never done so before the pandemic hit are a prime example. Similarly, startups have adapted. They’ve identified the best ways to go about funding their businesses during this tumultuous time. One such method which I’ve noticed many startups pursuing over the past few months is crowdfunding.
There’s no doubt that raising capital as a startup can be challenging at the best of times, but doing so in the midst of a pandemic is another story.
That said, if we’ve learned one thing over the past few months, it’s that humans have an innate ability to adapt. The millions of individuals who are successfully working from home having never done so before the pandemic hit are a prime example.
Similarly, startups have adapted. They’ve identified the best ways to go about funding their businesses during this tumultuous time. One such method which I’ve noticed many startups pursuing over the past few months is crowdfunding.
The advantages of crowdfunding during a global recession are plentiful and with the world in a reflective mood, could this approach be the best way to raise funds over the coming months?
Crowdfunding has always been an effective way to increase brand awareness and build a community. It also enables people to easily support projects and causes that they really believe in. Over the past few months many people have reevaluated what’s important to them. They’ve had time to reassess where they want to focus their energy and in many cases, their finances. Therefore, one could argue that launching a crowdfunding campaign at the moment could be very worthwhile.
We’ve picked through a range of strategies and come up with three key actions that startups can take to ensure that their crowdfunding campaign is a success.
1. Establish a decent brand following before crowdfunding
When you launch a crowdfunding campaign, you’ll want as many people as possible to know about it, right? So, don’t jump the gun. Take the time to build up a reasonable following on your startup’s social media platforms (LinkedIn, Instagram, Twitter etc.), mailing list and other community platforms before starting a campaign. Think in tens, not tens of thousands and invite a few people you know will be vocal, honest and proactive.
A Facebook group is a great way to jump start your community. Insider tip: get everyone in your team involved so that there are multiple voices keeping the conversation going. If you’re a solopreneur or short on staff, hire a freelance engagement manager to inject some life into your group and keep the conversation going.
When it comes to community building on social, make sure that your content is consistently on brand and engaging from the moment you set up your pages and in the lead up to the launch date of your crowdfunding campaign. This will help to ensure that social media followers notice, trust and want to find out more about your brand. Freelance graphic designers and copywriters can help you create eye catching content that social media users will want to engage with when scrolling through their social feeds.
Remember this: Engaging content leads to page visits and page visits lead to page follows.
2. Create a persuasive and engaging narrative on your crowdfunding page
To maximise your crowdfunding campaign, you’ll need to carefully curate an engaging and inspiring crowdfunding page to convince people to donate funds to your startup. Yup, I said convince. Think of your crowdfunding donors as mini investors. You need to be persuasive and passionate in your pitch in order to win their support.
You’ll need a strong, compelling narrative which highlights your startup’s unique selling points. Simply stating facts, figures and founding dates won’t cut it. The copy on your crowdfunding page should inspire people to want to be a part of your startup’s success. Simple as. In the current climate, stories with meaning and authenticity will drive action more than ever and your ability to tell that story is paramount.
If you’re not a strong writer, don’t be afraid to ask for help from freelance copywriters. They have experience writing for a range of clients, so they know what works and what doesn’t work when it comes to writing intriguing, persuasive narratives. This is not an area to skimp on.
In addition to well written copy, many startups also include short videos on their crowdfunding pages. These videos typically give the viewer further insights into a particular startup, it’s product or service, the team involved in bringing it to market etc. It tends to humanise the startup to a certain extent, as these videos often feature the founders themselves appealing for financial support.
As people only engage with high quality content these days, poor quality, grainy videos won’t cut it on crowdfunding pages. If you don’t have experience making or editing videos, it might be worth onboarding a freelance videographer to help you create a short video for your campaign page to complement your strong written narrative. You have the ability to record your brand story using your phone camera, a bedside lamp and a stack of books as a tripod but that doesn’t make it a good idea! To really give your video punch, a videographer, video editor or creative director is a must.
3. Promote your crowdfunding campaign
Remember that engaged, passionate following you built up? Now’s the time to tell them all about your crowdfunding campaign. You don’t get many shots at this so make the first one count.
Build up to the launch date, generate tension and excitement. Create content that gets your followers pumped about your upcoming campaign - think countdown graphics (you can also repurpose these when the campaign is live) and exclusive early-access links that will help to create some hype and anticipation among your followers.
Many startups like to line up donors before they open the doors to the public. These big spenders will put a good amount in the pot and set a precedent. When you officially launch your campaign, share the link with your followers in a way that encourages them to click on the link and donate. The initial launch is critical and you should have multiple campaigns running on a range of channels spreading the word. A high concentration of volume will help get things moving.
It’s also worth sending out press releases to both print and online publications about your crowdfunding launch. Freelance photographers and copywriters can help to ensure that your press materials are clear, concise and engaging.
The increasing popularity of crowdfunding platforms in recent times is a testament to the success that many startups and individuals alike have had from this method of fundraising.
You’ve most likely researched the big-hitters - KickStarter, Indiegogo and GoFundMe but you may not have discovered lesser known crowdfunding platforms like WeFunder, Fundly and Crowdfunder.
At a time when many funding avenues have been hindered by the pandemic, crowdfunding is a really effective and inclusive way for startups to raise capital.
If you need help sourcing suitable freelancers for your upcoming crowdfunding campaign, we’d love to hear from you.