Knowing she had many fans and her shows have been shared millions of times around the net, it was felt reaching her target to kick off the project wouldn’t be a problem.
A few weeks later, she announced to her stunned audience she’d had to cancel the project. The reason was simple: she couldn’t raise enough funds through crowdfunding.
The disappointment seeping out of the pores on her skin was all too evident.
Apparently, her fans (millions around the world) didn’t think much of her musical talents to invest money into the project.
However, many people low on funds and less popular than her have raised funds via the online crowdfunding method.
So the question is, why did she fail in spite of her popularity? First though, let’s explain what crowdfunding is to those who don’t know.
What is crowdfunding?
Traditionally, when you need money for a project, you call people to come and donate to your cause. The more people you invite, the more likely you would reach your target if majority of the invited folks donated money.
Crowdfunding works according to the same principle. While the traditional strategy involves meeting with donors physically or invite them to meet at a venue, crowdfunding utilizes the reach and ease of the Internet.
To launch a crowdfunding campaign, you have to go through a mediators or moderators. These are mostly reputable Internet-based organizations.
You pitch your idea to them. If they support or see the merit of your idea, they help you broadcast it to the wider world.
Their involvement gives donors the confidence they are not being scammed by some smart person with a convincing pitch.
Their approval is the only stamp of legitimacy Internet users need to begin making donations.
So that is how online crowdfunding works: you pitch your project to a crowdfunding site, they, in turn, let the world know you need money. Then people around the world donate money through the website.
The scale of Crowdfunding
A recent report indicated that the amount of money raised through online crowdfunding worldwide reached about $34 billion. That is a tidy sum of money.
The implication is this: if you know what you are doing, a slice of that about can be yours. But as the case of the popular YouTube star showed, you really have to be convincing to reach your target.
For instance, the new 2017 movie, The Receptionist, was produced with money raised from this method. Jenny Lu, the producer was able to attract $500,000 from people who believed in the project.
And this is not even the largest amount raised through online Crowdfunding.
From early reports about the movie, it was money well spent.
Why choose Crowdfunding?
It has been said that online Crowdfunding is the future. Though the concept is still young, the journey so far looks promising.
If it continues on this trajectory, sooner rather than later, Crowdfunding would be the way for disenfranchised people to raise money to execute projects.
Because of how easy it is to scam people online with bogus projects, acceptance of crowdfunding has been rather slow. Hopefully, once a way to vet people and their ideas easily is found, Crowdfunding would really become mainstream.
That said, one can immediately see why Crowdfunding has great appeal among some people.
First of all, sourcing for funds this way means one is not under pressure to pay back with interest like traditional loans.
Secondly, since most or all of the donations are anonymous, you execute your project without thinking of hurting your sponsors. Or stepping on the toes of your donors.
And because of that, the project gets the undivided attention it deserves. Basically, you become loyal to only your dreams. If you fail, your donors won’t be screaming for your neck.
Tips for raising money through online Crowdfunding
There are many successful online Crowdfunding drives. Reading about them gives the impression it’s just a slice of gold waiting for anyone to cut their share.
That is far from the truth. To really make it, you can start by taking a leaf from Jennifer Lu, the producer of The Receptionist. She used the Kickstarter, arguably the biggest Crowdfunding site in the world.
So you can register with them and take it from there. Then Use the following steps as a general guideline:
1. Do adequate research
You must treat your foray into online Crowdfunding just as you would any business. Research how others were able to raise funds. This would give you a fair idea of what works and what doesn’t.
No matter the site you use, explore the website thoroughly to get a feel of the ‘winning formula‘ so to speak.
2. Set your goal with a reasonable target in mind
Here’s the thing about online Crowdfunding, if you don’t meet the target, you get nothing. The money gets returned to the donors.
So make sure you know what you really want and how much it would cost. Online donors can easily do a simple research to see if your demands are reasonable. So it is hard to fool them.
3. Set a reasonable time frame
Sites like Kickstarter normally advise people to put a 30 days’ time limit to raise the money. But the final choice is at your own discretion.
Before setting the time frame, consider how long it would take to advertise your idea. And of course, understand that people would likely take their time to think about the wisdom of supporting your project.
Again, you get nothing if you fail to reach your target after the time frame set by you.
4. Your pitch
This is important. You must make it clear, concise and easily understood. Create a video of what you intend to do since people relate more to videos than just text.
The key is to make your pitch in such a way people are excited when they read or see it.
5. Promote your project
This is where social media would really be of help. Market your project aggressively on social media, friends, and family.
Don’t spare any opportunity to spread the word out, whether online or offline, about your project.
If you have to promise some rewards to potential backers, publish that and use it in your marketing drive. But make sure you don’t promise more than you are likely to get in donations.
6. Calm down and enjoy the ride
So your Crowdfunding campaign is on. This is where you learn the power of patience.
Perhaps, you are not getting the sort of response you hoped for. Don’t be dispirited. Be patient. Keep promoting your idea through more creative means.
But no matter what happens in the end, just make sure you have fun. Crowdfunding is not a ‘do or die’ thing.
You can always come back with an enhanced pitch and better projects in the future if you failed the first time.
That is the beauty of Crowdfunding. Because you spend almost nothing on your campaign, it won’t leave you bankrupt and unable to try again at a later date.
So, good luck!