Monday, 04 March 2013 11:01

Why crowdfunding is far more about the crowd than the funding

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Its an interesting one, crowdfunding. And over the last few years it has both made a big impact on how entrepreneurs, bands, artists and others are funded. It has also certainly divided opinion on just how viable the model of crowdfunding is. One thing that few people are admitting is that crowdfunding can be really hard work. And – a couple of campaigns later – I’m a staunch believer that the most important part of this fund-yourself-golden-carrot is the crowd, not the funding.

A crowd funding campaign is a bit like a wedding cake; it’s all about layers, and if you leave it sitting in the freezer, it won’t get eaten. A successful campaign identifies and engages with its core audience, then moves out beyond it and eventually gathers enough speed of its own that it (you hope) becomes contagious. And secret to all of this really working, is the work that you as the project creator puts in. Over the last 7 months or so, the 7 campaigns which have been successfully funded on StartMe, had one thing in common. They all put an enormous amount of work in - and today they are better of for it.

I drove past the movies yesterday and saw a number of films there which I’ve never hear of before. – I didn’t know about how much money and time it took to make (probably for the best) or why I should have any reason to go and see it (which I haven’t). What did they do to attract an audience I wondered? Are the assuming that by showing the movie people will automatically come and see it? As I drove on, I stated realising that this is actually very similar to the world of crowdfunding today.

Allot of work and creativity goes into the creation of film. And by nature, those involved are probably fairly creative and technically skilled. But do they ever consider how the audience will be attracted to see their creation? Those working on the latest blockbuster will certainly have this covered. I see marketing messages for the lasts 3D version of whatever Steven Spielberg has now come up with, often 6 months ahead of time.

The issue here is, in order to engage anyone and turn that engagement into contribution, you have to put yourself and your project out into the world before it’s shiny and cinema-ready. You need to engage with your audience.

We’re in the middle of a range of crowdfunding campaigns right now. Some of them gathering momentum very quickly while others die a slow and uneventful death. You can view all of these on the website here. Some of these are expecting their campaigns to attract funding just by adding them to StartMe, very similar to the movies I saw that no one has heard of. Others are writing articles and blogs, investing tie on social media pages, talking to friends and colleagues about it, doing everything they can to let the world know. Some of these project creators are W emailing their existing supporters with pro-active frequency, looking for every possible opportunity and networking event to tell someone else about their idea, spending sleepless nights thinking about how to raise awareness and who else this project could matter to. - It will be these same people who get their project funded. It will be these same people who make a success of their business.

And the best part of all this hard work? They are building an audience, a dedicated and passionate community who want to see these projects succeed and those behind them become successful. Of course, we do need R50,000 to make the project possible. And we do need as many people as possible to contribute in order to make that happen. Without the funds, the projects may struggle to ever see the light of day. But the pressure of having to reach a target has forced us into being more thoughtful, effective and resourceful. Its forcing those who want to raise funds to engage with their audience in the way you will need to if you ever want to see your business being successful. And this, for me, is hands down the pot at the end of the rainbow.
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Ben

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