02 Mar How Social Media Helps You to Start a Business Through Crowdfunding
One of the major things the Internet has given to business in recent years is the ability to crowdfund a startup or project, mostly thanks to the power of social media. Instead of pitching your ideas to investors and venture capitalists, most of whom may not take to your business ideas like you’d initially expect, you can pitch to the online public and have them donate to your cause in exchange for bringing something desirable to the table.
This method of raising capital has become a favorite way for startups to get funds, and even for established companies to gauge interest and raise additional funds for a new concept or product. You too can harness this power, and social media is the primary tool for the job.
However, it’s more than just putting up a crowdfunding page and begging for people to donate on social media. Most likely, you will be ignored or may even be reported as scam. A solid plan is needed for your startup crowdfunding campaign to go smoothly. Proceed through the following steps.
Setting Your Goals
Before you get into crowdfunding, you must plan carefully. If you’re starting from scratch as an entrepreneur, then you will have to find ways to network and partner with known entities.
You must also set realistic goals. You don’t want to promise too much during your crowdfunding campaign and potentially come up short later on. It is better to promise conservatively, and then exceed those promises later by executing everything perfectly and leaving enough room to do a bit more.
These goals must be neither vague nor intangible, but specific and known. Goals need be attention grabbing, and measurable through empirical terms that the public can easily understand. They also need to be reasonably attainable….with effort. Your goals must be relevant with the times, and in-demand as a business.
Finally, there has to be a due date so people know when to expect them. If they are neither relevant nor expected within a reasonable time frame, no individual or entity will want to give you their time and money.
Identifying Your Audience
Initially, you will not have much of an audience, in spite of your social media accounts. Your audience may be limited to mostly your family and friends. They become your first tier audience. When they tell their friends about you, those friends become your second tier audience – that is, if you catch their attention.
If word spreads even further, you then gain a third tier audience consisting of the general public and any sort of media. That’s how it works with any business and all crowdfunding campaigns. Family and friends who are willing to contribute to your startup can be encouraging, but it is another thing to get funds from strangers who are expecting you to deliver on your promises.
Not everyone will look at your business and immediately be interested. Whatever niche or category your business is in, you should target a particular audience. You should consult with your target audience regarding your business. You can get feedback, both encouraging and critical, and they may even offer better project management ideas on your current campaign. When you have earned their trust and confidence, hopefully, monetary contributions will then follow.
Looking Beyond Your Own Network
This is an extension of the previous step. Not only should you expand your audience, but also your personal network in order to spread your business and crowdfunding campaign further. Reaching out to new potential contacts, who can be added to your personal and/or business network, is a big part of the process, and you can start doing this online.
Seek online outlets related to your particular niche or category of interest and participate in their discussions, answer questions, help whoever asks for assistance, and share your project with them. Do this creatively and interestingly and you may have people who will contribute to your crowdfunding campaign, help you with other pertinent matters, and/or provide you with additional contacts who may become invaluable later on.
Do not post a request for support right off the bat, because you will most likely get rebuffed. Instead, become a valuable part of their community. To receive value and respect, you must give first. Prove yourself to be someone who is genuinely interested in the niche, rather than just someone looking to gain from them for nothing.
Promoting Your Campaign on Social Media
Sharing a post on Facebook with a link to your crowdfunding campaign page is not enough to bring people in. Few people will feel compelled to click on it unless you give them a good reason to. There are a few good ways to do that. It is a good idea to hedge your bets and stack up whatever promotion methods you do for best results.
One of the best ways is to create a compelling video that conveys your message. To get the message across and make it sticks, tell a story while keeping the video as succinct as possible.
You can also have good photos of whatever you are trying to accomplish with your startup, such as a product. It must be something that is tangible and attainable so that the audience can believe that you can fulfill that goal with your crowdfunding campaign.
Your crowdfunding campaign page must have an FAQ section that addresses key questions from prospective investors. This may help convince people to contribute. Continue to convey your core message as thoroughly and convincingly as possible. Do the same in social media, where you answer questions and further promote your campaign.
While you’re at it, do what you can to promote your business. Do so with a hunger that must feed on success at every turn. A thirst that can seldom be quenched. Do it before, during, and after the launch of your business. Don’t spam, but do have regular updates of what’s going on. A blog is good for this. A VLOG (Video blog) may be even better if you have visuals to show. However, a simple social media status update should suffice for the most part.
Checking Results and Improving Content
As with any sort of marketing campaign, you need to be able to track your progress. This allows you to adjust your content to make it more appealing and readable. You may even need to adjust your entire campaign! The best way to do this is by creating a week’s worth of content for all social media channels and tracking their progress upon publishing. It is important to look specifically at their reach and engagement.
You can then figure out which ones are doing well, and what can be done better. You can either work to improve the content that is ineffective, or concentrate on the types that perform well.
Take note that crowdfunding is not a cure-all solution to startup woes. Some people may not have the slightest interest in your business. On the other hand, for those who have shown interest and excitement in your business, it is essential that they are in no way disappointed – regardless of the amount of money they contribute. With careful planning and precise execution, social media can be both the catalyst and purveyor of your business’ success through crowdfunding.