The 10 most common crowdfunding mistakes (and how to avoid them)
1. NOT SUFFICIENTLY REFLECTING ON IDEAS IN ADVANCE 💡
Every successful crowdfunding project’s driving force is a good idea. That’s why it’s important to reflect on it critically within your network early on. Is your idea really as good as you think it is? Is my idea a potential crowdfunding project? Is there demand and support for my plan? Are the goodies appealing? Does the video make sense? When it comes to crowdfunding, it’s essential that you get your closest circle involved: They are your first supporters, whether through contributions or by sharing and promoting your project. If you can’t convince those closest to you that your idea is a good one, you might need to go back to the drawing board.
2. (TOO LITTLE) PREPARATION ⏱️
“A goal without a plan is just a wish”. Good preparation is indispensable for all crowdfunding projects (including their subsequent implementation). Allow yourself enough time! We recommend at least 2 months of preparation, plus an hour each day during the campaign. Plan out your communications in advance and really calculate how much money you will need. Think about how long it will take to complete your project, so that your supporters can receive their promised goodies in time. Your project will be even more convincing if you can show exactly how you will use the money.
3. CROWDFUNDING ≠ CASH COW 💰
If you think that crowdfunding is a simple cash cow, you’ll soon come back down to earth. A lot of hard work goes into successful crowdfunding projects. Nobody was just waiting for your project. And, unfortunately, you shouldn’t think that you can simply upload your project and wait for wealthy supporters to offer large donations either. But if you want them to hear about your project, you need to work on persuasion continuously, and ensure communication and that your project is spoken about and reported on.
4. NOT KNOWING YOUR OWN TARGET GROUP 👨👨👧👦
Make sure you know exactly who your target group is, and who your project will address. This will also help you with all the other steps: choosing the right goodies and their prices, as well as the right means of communication. Not everyone was just waiting for your project. Generally, money comes from 3 sources: from family, friends and acquaintances (your closest crowd), from distant acquaintances and acquaintances of acquaintances (your network) and from somewhere else (magic). Choose the right channels and places to reach your target group. The handbook contains a list of 6 groups that can help you think of all your potential supporters.
5. THE WRONG GOODIES 🎁
Goodies are rewards as thanks for financial support. Not everything is suitable for every project: social projects have a different logic to someone raising money for their own business. It’s worth putting in a bit more time to offer the most attractive and creative goodies possible. If you need some ideas, you can find a whole range of creative ideas for goodies in our handbook. Or why not take inspiration from other successful crowdfunding projects?
6. (A LACK OF) COMMUNICATION 🔇
If you want lots of people to support your project, you need to reach lots of people. We don’t want to kid you, crowdfunding takes a lot of hard work. This means it’s essential that you plan enough time to keep communicating throughout the project’s entire duration. Once you know your target group and have decided on suitable goodies, we recommend defining an action plan in advance of how you will communicate with your potential supporters throughout its duration.
7. THE WRONG GOAL ️🏋️♂️
Deciding on the right crowdfunding goal may not seem easy at first glance. It shouldn’t be too high, because if you fail to raise the amount within the specified period, all the money raised will be returned to your supporters. At the same time, don’t set it too low, because once the goal is reached, there’s no pressure on raising every extra penny. Make sure your target amount is realistic. Crowdify also offers a stage funding option, allowing you to split your target amount into several smaller targets, reducing the risk of your project failing.
8. UNDERESTIMATING THE VIDEO 📹
A video helps bring your project to life: viewers can see the person and the passion behind your project, and you will seem more trustworthy. From experience, we know that projects with videos are much more successful than those without. Plus, let’s be honest, hardly anyone takes the time to read the whole text from start to finish. You don’t need to be an Oscar winner to make a successful project video: you just need a mobile phone, and maybe an external microphone (sound is important!). Make sure you film in landscape mode. Show yourself as you are and introduce your project – show why it’s important. It’s best to keep it short and concise so viewers don’t get bored. By the way: you can find all our Crowdify video tips, including tips for video editing software, in our handbook.
9. NOT SEEING THE DEADLINE AS AN OPPORTUNITY 🚀
Crowdify uses an “all-or-nothing” approach to crowdfunding the project that’s close to your heart. We chose this setup to help give your promise to the crowd credibility. For example, if we can raise £10,000 in 30 days, the open-air concert can take place. Use this wisely – and communicate. As the deadline approaches, it means that there are fewer days left to gather support – it also means that it really is a question of NOW or never. This ticking clock really increases the chances of gaining support. Your remaining concert tickets are more likely to be sold on days 28 to 30, rather than day 15. So, use these rules to your advantage and keep your crowd up to date with your progress, and with your missing target amount.
10. PROMISING TOO MUCH 🤹♀️
The most valuable currency in crowdfunding is trust in you as an initiator – you absolutely mustn’t gamble this trust away. Give boosters a little insight into your realistic budget, which includes the costs of implementing the project, any shipping fees for goodies, and a small contingency fund. Think about the time you’ll need to implement your project, and make realistic estimates of how long it will take to implement the project and ship your goodies.
11. BEING PUT OFF (BONUS)
However, the biggest mistake in all that would be if you were to let yourself get deterred. We all know that no one is born a master, you have to put the work in, and that’s what we’re here for. We’ll be happy to help you raise funds for your project. You’ll find tips on all these points (and much more) in our Crowdify handbook. It is only available to project initiators. Plus, we’re always here to help and share our wealth of experience with you. So, what are you waiting for?