The Crowdfunding sector now growing at a rate of 30 per cent a year, increasing numbers of schools, colleges and students are turning to crowdfunding as a viable source of funds. But if you’re thinking about raising money in this way during 2020, don’t assume that the platforms’ continuing expansion means you’re guaranteed to achieve your ambitions. Successful pitches require hard work – both to secure a platform listing in the first place and to persuade donors to back you with their money. Here’s seven tips for making crowdfunding work.
1. Pick the right platform
Start with the basics. Are you planning to borrow money from investors, ask them to buy an equity stake in your business or just raising money for education costs? The first option may suit more developed companies with reliable cash flows – you’ll need to be able to make regular repayments, including interest. Equity fundraisings, on the other hand, ask investors to buy into future potential with no immediate commitment to pay them a return on their money. And of course if you’re just looking to help pay education fees then a specialist site like Feesable.co would be your go to answer.
2. Set out your funding plan
Going down the crowdfunding route is not an excuse for a poor-quality funding plan. You’ll need a properly constructed plan to get your campaign listed on a platform – and donors will want to see it too. Your plan should include realistic forecasts for what you’ll be spending their money on, as well as detail of how you will achieve success. You will also need to explain exactly what you’re raising money for. If in doubt, use examples of other people’s funding plans so you can see what’s required.
3. Get the pitch right
Your pitch to potential donors is crucial – it represents your one chance to convince them to hand over their money to people they don’t know from Adam. Spend as much time as possible as you can on the pitch, taking advice and feedback wherever it is available. Look at successful pitches on your platform of choice and learn the lessons of these examples. Aim to build a story – what’s your background, what are your aspirations, and how donors can share in your success along the way. Video is particularly powerful.
4. Spice up your offer with tax breaks
Check to see whether your pitch qualifies donors to claim a tax break in your country. There are different rules all around the world which make the subject complex, but if you can offer the opportunity for donors to claim their contribution as a tax deduction – that makes giving so much less painful for your donors.
5. Rewards can help too
You don’t have to offer rewards alongside a crowdfunding pitch – and donors should be putting money up because they believe in your education rather than simply get a freebie – but the right offer can be a big help in persuading people to back you. Not only do you build goodwill but also rewards are a way to give back to your community. You can also persuade donors to put up more cash by offering regular rewards in return for more long term agreements.
6. Keep talking
Once your pitch is uploaded, the hard work really starts. Look for every opportunity to drive traffic to the pitch, whether through social media, traditional press coverage or anything else. Aim to create a buzz around the pitch right from the start, keep people updated on your progress, and be prepared to answer questions from potential donors. The more fresh content you can get out there to keep the story alive, the better.
Good luck and remember once you fundraise successfully everything will be Feesable!