Lessons Learned In Crowdfunding

Two months ago I launched my first ever crowdfunding campaign. It was, to say the least, an adventure. It was also a big learning experience in both communications, outreach, community building and fundraising.

I thought I was pretty good with at least 2 of those 4 categories, and I did learn new things in each of them. Since crowdfunding has become a more common approach to fundraising and project creation for both entrepreneurs, startups, and musicians, I wanted to share the lessons I learned in crowdfunding with you, so that you can have even more success with your projects.

What I’m going to share here in no way makes me an expert on crowdfunding. There are plenty of people who have run campaigns that raised 100s of 1000s of dollars and more. Our campaign was relatively small, but we did fund it successfully, while several similar projects have had a rough go at getting funded. Here is what I learned that you can and lessons you can take with you to make your campaign run successfully.

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  1. Do a lot of research BEFORE you start your campaign.

I did a lot of reading and asked friends who have done crowdfunders before how their campaigns worked, what they did right and what they would do differently if they could do it over again. I also read a ton of articles before we started the campaign. I did a lot of research before I picked which crowdfunding platform to use. Regarding tactics and strategies used, Amanda Palmer is one of my biggest mentors for this by way of her book The Art Of Asking.

I’m a big fan of PledgeMusic (even beyond having interviewed Benji Rogers for a kickass conversation) and what kind of connection-building platform they have, but the project we did was not something that we could necessarily bring our audience into the making of. Our biggest challenge on which crowdfunding platform to use came down to Indiegogo, Go Fund Me or Kickstarter.

Kickstarter has a more robust set of tools and more funders use it, which leads to a greater overall contribution total than all other crowdfunding platforms. However, there’s only 1 way you can raise money and that’s if you raise 100% of your goal. Indiegogo gives you to option to keep a portion of your goal, or whatever you raise. Initially, that was the deciding factor in picking Indiegogo, except that we ended up selecting the Fund All option (more on that in a bit).

2. Get a commitment for 20-30% of your goal total before you launch your campaign.

This was something that came up consistently in the research. Before you kick off your campaign, have some commitment from your fans, followers, audience, email list or family and friends who pledge to fund a portion of your campaign. I got this commitment via email 2-3 weeks before we started the campaign, with suggested pledge levels and a few insights into possible perks.

Suggested contribution amounts in that introductory email are important. Some people will contribute at the suggested level, while others will give a different amount. When we kicked off the campaign, we had a solid first few days where we eclipsed 30% of the goal in no time. It was a great launch to the campaign itself.

3. Be patient with the process.

The solid start led me to a little fear after the first week when we hit this lull and the contributions virtually stopped for a few days. It was agonizing. I mentioned getting a solid commitment from folks via email but there were several people who didn’t respond to the initial email message and I wondered if my message had been lost. The lull in campaign support and the lack of response to messages in those days made me question a lot about my ability to communicate effectively, the value of our project (the creation of The Appetizer Radio App, which will debut before the end of 2015).

Fear is common in fundraising but you have to remember that it is a 30 days process and not something that happens overnight. I was reminded of this fact when we had a final surge towards the end of the campaign and eclipsed our total goal well before the campaign end date.

Crowdfunding isn’t an overnight fundraising event, or even a week long pledge campaign. It takes 30 days (60 if you elect to run that long). My fundraising experience in public radio pledge drives lasted 7 days on end, and there were usually 1-3 days in the middle of those drives where the pledges and contributions were stagnant. I had to recall those experiences in the midst of this crowdfunder as a reminder that the beginning and the end of the campaign is when the majority of your fundraising contributions come int.

4. Crowdfunding is sales and it takes a sales strategy to be successful.

Like I wrote about last week, we are all in sales no matter what industry or career we’re in. Crowdfunding is a sales process too, even though the setup is different. The core sales aspect is that you’re campaigning to get people to buy into your idea, your project, and the benefits that funding the campaign will provide for them. You have to sell people on the campaign, the project, and above all on you. None of the process is a given and nothing is guaranteed (more on that later).

Sales strategy is very much a matter of clear communication, which has to be a commitment from everyone on your team. I had 3 people working with me on our campaign so that it wasn’t all on me to take care of. The other responsibilities included marketing and promotions on our blog and social channels, outreach to new people, followup on contributions, email marketing messages, and updates to the campaign.

I also added videos and images periodically through the campaign to show more of what the value of the project is to existing and new funders. These videos helped to strengthen the connection to the project and provide more incentive to give. The videos were easily produced using iMovie. Production time took about 1 hour per video.

5. Don’t buy the promotion pitches you’ll receive after you start.

This was a big mistake I avoided and am very relieved we did. Almost immediately after the campaign began, we started getting private messages on Twitter and through Indiegogo from all of these companies who claim to be able to put your campaign in front of millions of crowdfunding supporters.

We already had the campaign shared on every social platform a whole lot and had some other media talking about the campaign. We weren’t at a loss of publicity or people talking about it. Chances are you will have a lot of people talking up your campaign too. If you follow my previous advice you’ll be in good shape. None of the contributors to our campaign were from random people who just saw our campaign and thought “Hey that looks cool. I’ll give them $5 to help out.”

That’s not the way crowdfunding works. There are hundreds of campaigns going on at any given time. People don’t part with their money easily. You have to build a connection with them and give them a reason to support your project. The so-called social media promotion companies all charge $25-$150 or more to put your campaign out to their list of people. They will message you throughout your campaign with solicitations to buy their promotions. Save your money and focus your energies on connecting with the people you know and the communities you’re in to get support.

6. Followup is key before and after the campaign ends.

This is one of the biggest lessons you can learn in community building. Followup and strong communication pave the way for better connections and more fruitful collaborations. I’ve seen crowdfunding projects that are funded successfully and then spend months without contacting the supporters to let them know updates or news about the project. How detrimental to your success is that!

We’ve made it a point to not only post updates to our Indiegogo campaign through their site but also email our funder list periodically to inform them on the status of the app, questions about particulars for perk items, deliverables and new connection information. And we’ve made it possible to continue to support the campaign after it ended (what Indiegogo uses is In Demand). These people are not just your funders, they’re your strongest community members. Keep them in the know for ongoing success and connections.

In conclusion

Crowdfunding is not a guaranteed way to fund your next recording project or make up for the money you already invested in your big idea. It is a way to really connect with the people in your community and garner their trust. Crowdfunding is about relationships and networking, and it requires a strong skill set in relationship management to be successful. If you want to just make money, pick a different method. If you want to build connection with your community and expand your network for a project that you don’t have the funds for on your own, consider crowdfunding as a viable option.

If you need any help, tell me how I can serve you.

 

 

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