For startups, one of the most challenging aspects to really getting the ball rolling is raising enough capital to open the doors and begin winning clients. Venture firms want you to prove traction – or gain some clients – to prove that your concept really is a potential hit. But for some, you may need that capital in order to simply open the doors and gain your first few clients. It’s like the chicken and the egg: what comes first? The clients or the funding to get those clients?
Don’t let this struggle keep you from opening your doors – follow these simple pieces of advice to gain both traction and funding for your project through crowdfunding.
Compare a Variety of Crowdfunding Platforms
Don’t just do a Google search and pick one. A crowdfunding campaign represents the first, major public introduction of your company or brand to the world. You need to first make sure that the audience you’re presenting to is your target demographic for raising potential investment. If a site is geared towards product launches, and you’re a service company, then you’re going to run into unnecessary difficulty raising the necessary capital.
To best gauge the success of a potential crowdfunding offering, reach out to the team behind the crowdfunding platform. Ask questions via email and read their knowledgeable resources available online. You’d be surprised how much information is available to those willing to do due diligence.
Develop the Perfect Sweetener
To get traction on a crowdfunding platform, you have to offer your investors something tangible. Whether that’s a stress relief ball with your company’s logo, or a discounted price on the first round of products your company produces, the investor needs something in return for their investment. After all, they’re making a massive risk. Some crowdfunding sites don’t even offer equity in your company. If an “investor” doesn’t have the potential to see their “investment” grow as your company flourishes, then what you’re really dealing with is a pre-sale customer. Don’t be afraid to turn the investment pitch into a pre-sales pitch!
Focus on Your Team
Your team’s story is going to be one of the most important aspects of your pitch. After all, anyone can make a new product and bring it to market. What makes your team of founders special and unique? Have you overcome some incredible hurdles in your life? Do you have a background that makes the likelihood of future success higher?
Take the time to develop a true narrative about your journey, and how your team ended up on a crowdfunding site. Get professional photos taken and market yourself as the next big thing. Who wouldn’t want to support the next Steve Jobs?
The Perfect Product
If you’re developing a product for sale, then you have to have done your research already in order to know what the market is looking for. If potential investors don’t feel like this is a product they desperately need, convincing them others will feel that way is an uphill battle. Take the gloves off, do your research, and pitch the perfect product to fill an existing need in the marketplace; hopefully it’s a need your potential investors have themselves.