Crowdfunding enables new start-ups whether a project or business idea to raise money from a large amount of people.  It provides a platform for small start-ups to introduce their idea into the public community, to gauge the interest and to persuade individuals to donate small amounts of money in return for exclusive rewards.  These rewards could be anything from free products, memberships or experiences.

Some business ideas that have started through crowdfunding campaigns are:

CleanersNow – An Australia online start-up that focuses on connecting cleaning and asset maintenance service providers with customers who are looking for cleaning services of any kind. An ecommerce website helps consumers to compare cleaning quotes from multiple cleaning providers, thus giving consumers the power to choose the right provider efficiently.

Exploding Kittens – a card game that quickly became a phenomenon, raised millions of dollars through a crowdfunding campaign.  The popularity saw 5 million decks of cards produced along with official merchandise consisting of t-shirts, mugs and plush toys.

Elevation Lab – a start-up that produces iPhone docks and accessories gained popularity with individuals and now has the products for sale within Apple stores.  It is the first dock to work one-handed and did not require financial support from external investors.

What you need for a successful crowdfunding campaign?

Share your passion

If you are thinking about crowdfunding your project or business idea, then chances are that you have thought about it for a while.  You need communicate this to your audience and allow them into your world, to see what you see.  If people can see someone who is passionate, they can see the potential and credibility.  You need to persuade individuals with the perfect sales pitch, why your product is a great idea and what problem will it solve.  Make them share your passion.

Exclusive rewards

Potential funders will be more likely to donate if they see a benefit.  People will not hand over their hard earned cash if it isn’t worthwhile.  Ensure you think about what exciting rewards you can offer to your funders for helping you lift your idea off the ground.  Everyone enjoys a perk and if you promise and engaging perk, it will help reach your funding goal.  Be realistic as you don’t want to be left with a promise you can’t deliver.

Promote, Promote, Promote

Crowdfunding is a full time job in itself, although friends and family will always provide support, you need to get your idea out there and gather interest and momentum.  The internet has massive pulling power so engage in social media, start networking and get the conversation started.  Everyone enjoys free food so organize an information night; it doesn’t have to be extravagant.

Provide updates

You need to keep the momentum flowing so keep your backers informed of your progress, everyone likes to be in the loop, it makes them feel a part of something, makes them feel included.  Keeping them interested ensures that people are talking about it.  Nothing ever goes to plan so don’t try to hide it, be honest with your following to earn their loyalty.