Building a business is hard--no ifs, ands or buts about it.
The good news is crowdfunding's making it easier. Kickstarter's eliminating the need for upfront funding, venture backing and even massive mortgages and big risks.
But for all the improvements and previously impossible advancements crowdfunding's creating for inventors and entrepreneurs, the majority of campaigns, some 60.42% of Kickstarters and even more Indiegogos fail to fully fund.
While running Art of the Kickstart, interviewing over 100 crowdfunding creators, conducting dozens of case studies and helping tons of clients, I've seen all too unfortunate patterns of failure emerge which plague the majority of Kickstarters. So if you're looking to launch, here's what you NEED to know to overcome the inevitable hurdles of crowdfunding.
1. Failure to Plan is Planning to Fail
Yeah, you've heard this clich voiced many a time.
Thing is though, founders fail again and again to heed the warning. And it's critical to success with crowdfunding.
You've got one launch, one make-or-break shot to shoot up the Popular Page rankings and get the organic exposure necessary to fuel your campaign.
But this, this doesn't happen overnight. It takes weeks, really months of planning and preparation to come out kicking.
And that's the issue. Most creators toil for months making, testing and refining their revolutionary product.
It's an exercise in self-restraint, you just want to get it out there.
Instead lay out the entire campaign, give yourself a solid 3 months before launching to maximize your chances of making it happen.
2. So Good It'll Sell Itself
...I like to call inventor syndrome. It's the concept of build it and they shall come, the impossibility of which we all realize, yet deep down often fail to acknowledge.
And it's this stupidity which has brought ruin to many an entrepreneur.
Awesome products NEED exposure and marketing. Even the world's greatest gadgets would languish and fade in the shadows of obscurity.
Well when crowdfunding, it's even more critical. Both Kickstarter and Indiegogo are built upon YOUR success. The faster you fund, the more THEY make, the bigger your organic audience becomes...the rich get richer, here's how that could be you:
- Leverage your personal network--Hit up friends, family and loved ones several times before launching. Get your network primed for 1st day funding, shares and success. Emphasize 1st day funding and shares for maximum results.
- Get media exposure - Easier said than done. Build a target list in advance, start scouting your ideal candidates and connect as best you can to build rapport. Then personalize your pitches, begin early and often and of course bust your butt throughout the campaign.
- Supercharge social networks - Social followers share your stuff, that's critical for Kickstarter. To win, begin building out and growing your company profiles at least 3 months prior to launch. The bigger the better.
- Building a launch list-- First day funding and backers are critical to your campaign success. Shoot for 20-30% of your goals within the 1st two days. So start sharing a coming soon landing page or even running paid traffic to begin building a backer base ASAP.
3. Poorly Planned Goals
Remember, with the exception of Indiegogo's flexible funding(something I highly recommend startups explore), it's all-or-nothing--going forward or falling flat.
Yet with so much on the line, founders still come to me proposing with unnecessarily high and unlikely goals...why shoot for $50k when we could have $300k?
And sure, everyone wants to be the next Coolest Cooler, but even they, the undisputed kings of crowdfunding only sought to raise $50k.
So the takeaway for you -don't guess, calculate exactly what your business needs to go forward and DON'T ask for a ONE DOLLAR more.
On the flip side though there's low balling it, a pricing psychology strategy a bit beyond the scope of this article, but one that's making ways in the crowdfunding community. So if making the most moolah matters to you, here's a great follow-up post.
4. Botching the Benefits
Inventors almost universally are awful salesmen...at least initially. They conceive ahead of their time, can create anything under the sun and awe us mere mortals with their abilities to innovate...
...when it comes to sales though, well that's a whole other ballgame.
Why though? Where's the massive disconnect come into the equation?
Here--consider a second your favorite brands, the last thing you bought, even the stuff around you as you're reading this article.
Why? Why do you have this, why'd you buy it?
Almost inevitably some sort of emotion, some memory rises to the surface.
It's not the i7 processor, the incredibly HD camera or anything else quantifiable...it's what you can do with it.
The processor, it powers online gaming with friends and builds a sense of community and camaraderie you'd never trade.
And your webcam...it's your portal to friends and family--maintaining your all-important relationships even under tedious travel.
But the benefits, the true selling points of the product are the last thing inventors and engineers ever consider. Size, specs, if you're lucky a touch of aesthetics...that's it. The overwhelming impact, the emotional connection a product can create by merely improving somebody's life...that's the heart of sales and strategy you MUST take to succeed.
So if you're looking to build a business or do anything really that involves customers or others, always ask yourself "how's this impact, improve or transform this person's life?" Answer that, make it inherently obvious through your Kickstarter's copy, video and even testimonials and turn your inanimate product into a living, backer beloved brand.