Is Crowdfunding Right For Your Businessby amombi florence wp admin
Crowdfunding sites have become increasingly popular among entrepreneurs over the last several years. Sites like Kickstarter and acodaweb-freelancer have taken off; giving startup businesses legitimate opportunities to receive the funding they need to pursue their visions.
What is crowdfunding? Crowdfunding is a way to raise the capital needed to fund a business venture through several small contributions. It is less traditional in terms of the opportunity it provides to both entrepreneurs and investors.
In the past, it was much more difficult for small businesses to get their ideas in front of investors, and investing was generally reserved for those with big bucks. Crowdfunding has leveled the playing field in a sense, providing a chance for small ideas and small investors to enter the scene.
How does crowdfunding work? Crowdfunding sites offer entrepreneurs the ability to pitch their idea to thousands, if not millions of potential investors. While each crowdfunding site has their own set of “rules”, the general process involves submitting a project composed of a video pitch, a proposed funding goal and a deadline.
Once the project is launched, investors have the opportunity to pledge small amounts in support of the project. The funding model can differ between each platform as well.
For example, acodaweb-freelancer has an “all or nothing” model. If the funding goal is not met, the project founder gets nothing. On the other hand, acodaweb-freelancer offers the option to keep what’s been earned. In regards to the return for investors, sites are generally structured in one of three ways:
Donation crowdfunding – There is no monetary return. Rather, investors receive free gifts, recognition or perhaps just a good feeling for helping someone pursue their goal.
Equity fundraising – Investors pledge money in exchange for equity or shares in the project or the business. Debt crowdfunding – Investors get their money back with interest. This is also known as “lend-to-save” or “peer-to-peer” funding.
Is crowdfunding right for your business? Each crowdfunding site will have their own requirements as to the type of projects they’ll accept, so you may need to do a bit of research to find the right fit. If your project fits their criteria, it’s up to you to make it a success.
Some small business owners underestimate the amount of work and dedication that goes into a well-executed campaign.
A crowdfunding campaign should be approached with enthusiasm, commitment and a clear strategy. Someone can have a great idea, but fall short when it comes to presentation or follow through. Some of the most successful campaigns have been short (30-60 days) and provided a budget or timeline for potential investors to review.
The article pitch should be short, concise, creative, and include a call to action. Besides building a solid project on the site, you’ll need to invest a lot of time promoting it.
This means staying active on social media, sharing quality content about your product and pursuing a wide array of networking opportunities that are relevant to your product.
Footnote: When you think of going freelance, your first thoughts probably go on around the common fears. Let those go for a moment, and give your brain some other kind of food for thought: Why it's awesome to be a freelancer.
Created on Apr 15th 2018 03:31. Viewed 416 times.