What makes crowdfunding work?


As an entrepreneur, I have no doubt that by now you have heard about crowdfunding and are most likely considering it for your own start-up or even the next set of business growth finance that you may need. The great thing about this source of finance is of course that you don't have to go hat in hand to the bank manager and explain to them just how you will pay them back over the next 10 years.

But crowdfunding in itself is not without its challenges. Its certainly not a case of simply adding your project to a crowdfunding platform and waiting for the money to start rolling in. Today we have a look at a few of the enormously successful crowdfunding campaigns we have seen globally and look at what has made them just so successful. Here are a handful of campaigns worth looking at:

Elevation Doc Elevation Dock is a simple idea; it is made out of aluminum, has rubber feet and is designed in proportions that allow it to be used with or without a case. This adds an element of flexibility that was simply not present before it became available. In addition to this, everything else about the product is designed to be of the highest quality possible. Its minimalistic aesthetics make it a suitable choice to go along with the iPhone. 

Penny Arcade Penny Arcade is an Internet comic site that used crowdfunding to improve what it offers to its visitors. Like many other sites on the Internet, Penny Arcade had to convert to an advertiser funded model, which the creators were not quite happy with.

LunaTik LunaTik is a project that started on Kickstarter with a relatively simple, but really quite brilliant, idea. The project involved marketing products that allowed people to turn their iPod Nano devices into watches. Not only did this project utilize a product that was already on the market – and very popular – it also combined that product with an already well-known product – wristwatches – to create something new and that has a natural, built in fan base.

I Draw Comics I Draw Comics was originally started on Kickstarter with a funding goal of $10,000. By the time the project closed, it had raised $245,870. The product, despite the tremendous amount of funding it managed to attract is a relatively simple one but is also one that would be eminently useful to people who are trying to break into the comic book world. 

Righteous Salad Dressing Righteous had quite a few things going in its favor from the start. The company already had a good reputation for its salad dressings and it was a realistic proposition that, with funding, the company could expand successfully into new markets. In addition to this, the salad dressing was already sold in several popular chains, showing that the company already enjoyed some success, which does help with persuading investors to put their money down for a project. 

South Africa's own crowdfunding platform Startme has also already seen a number of success stories in its first few months of operation. If you are keen to use this source of finance, be sure to read the abive cases and make sure your project is engaging enough for the crowd to invest.

All the best with this.


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