In a crisis, small businesses often face unstable cash flow, a delay in financing or a slowdown in foot traffic that can depress sales. Crowdfunding and fundraising platforms like GoFundMe can be a good option for getting the money you need -- fast. Small businesses have, to date, raised over $120 million on GoFundMe for campaigns related to COVID-19 relief.
CO-- talked to Rachel Hollis, senior communications manager at GoFundMe to learn more about using this free fundraising platform to its fullest potential. Here are some ways to make your business stand out on GoFundMe.
Share your story
Hollis recommends that you be upfront about what you're raising funds for, and what you will use donations to achieve. Will you use the money for rent? Are you going to cover your employees' health benefits? Start with the basics and consider adding specific numbers to help donors visualize how their contribution will directly impact your business.
"Once you've covered the basics, be sure to provide donors with the backstory of your business and how it has impacted the local community. When donors can connect with your story, they'll feel more inclined to support your cause by donating or sharing with their networks," said Hollis.
Talk about why you got into this business to start. Small business owners are a passionate bunch: Tap into that drive, creativity and enthusiasm that brought you to this point and channel those qualities into your campaign.
Set a fundraising goal you can achieve
GoFundMe allows you to set flexible fundraising goals. Unlike a crowdfunding platform, which may require you to hit a certain dollar amount before you can withdraw funds, GoFundMe allows you to keep every donation you receive. That said, you'll get more traction if you set a realistic dollar goal.
"Start with an attainable goal where your donors, patrons and supporters feel they can make a direct impact. As you hit fundraising milestones, continue to increase your goal and use this as an opportunity to post an update and thank your donors," said Hollis.
While the GoFundMe platform itself is free, there is a fee of 2.9 percent, plus 3 cents per donation which goes directly to our payment processor. Donors can choose to "tip" to cover that fee, but if they do not, it will be deducted from your fundraising amount.
Get creative with your campaign
Many business owners are uncomfortable asking their loyal customers for straight cash. It may be more palatable to structure your campaign with some incentive. "While it can be challenging to ask for donations, get creative with your network on ways they can support your business. Consider offering curbside pickup, gift cards, loyalty programs or other online purchasing options," said Hollis.
Ale Industry, a brewery in the Bay Area, is running a GoFundMe campaign that provides customers with a gift card for the dollar amount they donate. Customers can then use their gift card to shop online during COVID-19 with curbside pickup available or bring their empty growler for a (sanitary) refill. It's a great example of how a local business can engage with its customers while still adhering to lockdown regulations.
Spread the word
For maximum impact, make sure to share your GoFundMe far and wide. "Leverage your personal and business social media channels by sharing on Twitter, Instagram, NextDoor, LinkedIn, Facebook and any other social platforms. If your business uses email marketing software, send an email blast letting your subscribers know that you're fundraising for your business," Hollis recommended.
A great example is I AM Books, a Boston bookstore who launched a fundraiser to pay their month's rent and employee salaries. The goal was $5,000; to date, they've nearly doubled their goal by reaching out to the community for support.
It's not enough to send out a blast once your fundraiser starts and hope for the best. Continue messaging your followers throughout the campaign with updates as you get closer to your fundraising goal. Ask your donors to share your fundraiser with their network to keep the momentum going.
Make the right "ask"
Hollis notes that people use GoFundMe to raise money for just about everything, from medical expenses to animals and pets. But for business owners, this platform is great for receiving emergency financial assistance immediately. Some of the most common expenses small business owners are covering through GoFundMe include:
- Monthly rent or mortgage payments.
- Health insurance for employees.
- Crisis pay for employees who aren't sick but are out of work.
- Employees who need time off to care for their children.
- Any other operational expenses businesses are struggling to pay.
Hollis said that when campaigns fall short of reaching their goal, it's most likely because they weren't sharing the fundraiser widely enough.
"Acquaintances are much more likely to donate if they see that you've already received donations from other people. That's why it's important to first share your fundraiser with family, friends, patrons and loyal customers," said Hollis.
Try to build a groundswell of support by starting your fundraising outreach from people you know will respond generously. From there, word of mouth will help carry you forward.
For more resources, check out the platform's The Best Fundraising Tips for Small Businesses. GoFundMe has also launched a Small Business Relief Initiative to provide small businesses with fundraising services, financial assistance, tools, and support during and after the COVID-19 crisis.