How to: get the crowd to follow
By Luca Sabia for Ethos magazine: issue 15| October 2021
Crowdfunding is the perfect medium to start building an audience, proving a concept and carry out your market research — and that’s before you even get to the money, says Luca Sabia. Here’s how…
Money and people. According to business scholars, these are among the main hurdles social entrepreneurs have to overcome to succeed with their projects. The web promises to provide us with a solution. We are talking about crowdfunding, a form of digital fundraising that over the past decade has established itself as a viable strategy to raise funds online, whilst offering the chance to build your first customer base.
There are many types of crowdfunding out there. For example, people can donate to your cause or support your creative project in exchange for a gift, can take a stake in your company, or lend you money. In other words, there is no one-size-fits-all. There are many factors you might want to consider before deciding what form of crowdfunding is the right one for you and, accordingly, how to set your crowdfunding strategy.
If you think it could work for you, it’s useful to start familiarising yourself with it. These are both my tips and your first two cents, to begin with.
1. Take a look around
If you are thinking to go crowdfunding, the first thing to do is look around. There are many platforms in the market, and each one with its peculiarities. You need to understand which one fits you best. Subscribing to some newsletters is a good starting point to form your idea; backing other campaigns gives you an idea of the different ways each platform works, and what happens to your money.
2. Be inspired by other entrepreneurs
Every day there are dozens of entrepreneurs raising funds online. Not all campaigns are a success, so reflecting on the failures and successes of other people is good food for thought to think about how to set yours. Take a diary, writes your notes. You might also want to speak to other entrepreneurs and learn from them. But remember to send a thank you card if you’ve asked them to share time and insights. Everybody likes to receive a thank you card and it’s just possible that that entrepreneur you had a coffee with will help you by pledging to your project.
3. Start building your community
Three are the things you can take for granted in any crowdfunding campaign: your project, your community, and your story. If we can assume there is a project behind your campaign, at the same time, you need a community in place. Where is yours, and how will you connect with them?
Do you know that the most successful projects are the ones whose target amount has been covered for the 30% before the campaign starts? To make things easier, think about the potential for building your future with your people. As one entrepreneur told me: “We launched our inaugural crowdfunding campaign to give our community the chance to be part of the company’s future.” In other words, the unique value of crowdfunding is not the money you get (however important), it’s your community. Let’s begin to populate your mailing list.
4. It’s a conversation
As a famous novelist once said: “You’re not screwed as long as you have a good story, and someone to tell it to.” All of us need stories to make sense of the world around us. You need a story for your campaign as well. But this is only one side of the coin. One entrepreneur suggested to me: “Being a marketing campaign, crowdfunding allowed me to customise my message for the different groups of stakeholders to get them on board and to start a conversation.”
5. Plan
Like any other marketing campaign, crowdfunding does not make an exception and needs planning. That means it cannot be improvised. What is your unique selling proposition? Who are your target customers? Who are your competitors? How much money do you need? How much time will your campaign take? And so on. You could start from here to create a one-page marketing strategy, to begin with, as a sort of living document you can update as things progress.
6. Don’t forget your team
Last but not least, your team is pivotal in running a successful crowdfunding campaign. Who can be of help? Who can support you to help you win your target? Crowdfunding is not a collateral activity in between one task and the other. For sure, it’s worth looking at a consultant to navigate the complexity of this fundraising tool that is continuously evolving. But, in the end, you are the master of your fate, to paraphrase a popular movie. Another entrepreneur told me: “Crowdfunding is not an easy task (…) it is more than a full-time job and it makes our company feel like a social media company. So now, the company is split in two, with one side running our core business and the other the crowdfunding campaign.”
Luca Sabia is a lecturer in enterprise and entrepreneurship within the International Centre for Transformational Entrepreneurship, an academic think tank at Coventry University. A marketing passionate, he is a Member of the Chartered Institute of Marketing. For over a decade he has helped startups, charities, trade bodies, SMEs, and Fortune 500 companies across different sectors maximise their strategies and has enjoyed taking part in the creation of a couple of startups.
