One of the biggest challenges when starting a new business is access to capital. Family and friends don’t always have deep enough pockets, and banks aren’t particularly accommodating to entrepreneurs. Enter crowdfunding, which has swiftly become mainstream. It’s a great option, yes, but there are a few key things your crowdfunding strategy needs if you wish to hit your funding target.
6 – 12 Months Before Launch
* Build Social Connections: Before you fundraise, you should “friend-raise” on social media. And you must start at least 6 – 12 months before you plan to launch your campaign. If you’re aren’t already active on social media when your campaign starts you’ll have trouble with traction and credibility. The bigger your personal networks, and the personal networks of every key member of your team, the broader your reach will be as you begin your campaign.
* Build a Powerful Email List: Expect that nearly a third of all the funds you raise will come from people you know. You need to have a minimum of 2000 people on an email list that you can notify of your launch. It’s also a great idea to ask a few of your connections who have lists much larger than 2000 to share news of your campaign.
3 – 4 Months Before Launch
* Befriend Bloggers: Do your research and reach out to 15 – 20 bloggers who are popular and credible with your target market. Yes, your PR pitch will work with these guys, but also consider offering to sponsor a post on their blog.
* Develop an Effective Pitch Video: By the time you’re 3 months out from launch your pitch videos should be almost ready. Consider including a short on-camera appeal that you send out to your personal networks, but this probably shouldn’t be the only video you rely on to get the word out.
* Consumable, Sharable Information: Remember to keep the information about your product, your pitch, your entire campaign, dead-simple and easy to digest, and easy to share. Have a package of pre-written emails, posts and tweets ready before you ask someone to help you spread the word.
* PPC Advertising: You have heard the stories of the startup that blew the roof off with an incredibly successful campaign. The reality is that the average amount raised in a crowdfunding campaign is less than $10,000. Pay-per-click advertising can be a relatively inexpensive way to drive traffic to your campaign website and boost that bottom line.
* Stay Engaged: Stay engage with your audience throughout the campaign, even the ones that have already funded. Be active with updates, responses, and possibly offering new perks or bonuses.
In most equity crowdfunding campaigns, investors must be accredited. For reliable, fast and secure verification of your investors’ accredited status, turn to the pros at VerifyInvestor.com.