Five Things I Learned About Crowd Funding for a Small Business
This past weekend, my first foray into the world of crowd funding came to a happy, successful conclusion. Posting my project on IndieGoGo.com, I managed not only to meet, but to exceed the target funding goal for my project to add high quality videos to my website. And I learned some valuable lessons along the way.
1. Crowd Funding Requires Proper Attention, Care and Feeding.
Imagine planting a tomato seed in a pot full of rich soil, with all the potential it holds for producing juicy, delicious tomatoes. And then walk away. Don’t water it, don’t give it proper light, don’t fertilize it. I guarantee you will not be having tomato salads any time soon. Crowd funding projects are the exact same way. The sites are littered with projects that never get promoted and never get any contributions. Taking that lesson to heart, I promoted the heck out of my project via emails, Facebook, Twitter, LinkedIn and Foursquare. I asked people not only to contribute if they could, but also to share the link with their networks, which is incredibly valuable for spreading the word and getting people to go to my project’s site.
2. There’s no accounting for human behavior – thank goodness!
Getting people to click the button and make a contribution is an art, not a science. Some of my nearests and dearests apparently couldn’t be bothered to help me out (you know who you are – I’m not bitter). On the other hand, some people who I know are in difficult financial situations these days made wonderful contributions, shared my link, reposted my posts. Some people contributed at the very beginning of the project to help validate it, while others waited until the very last minute to make sure I made it over the top. Others contributed some amazing VIP perks to my cause, which quickly got snapped up by other contributors. I was so moved by the generosity of everyone who participated in my project (one person in particular – you know who you are). I could probably write a thesis about the complex psychology behind each individual’s decision about how much and when to contribute.
3. Don’t worry about communicating too much. Trust me on this one.
To be honest, I felt self-conscious at first about asking for contributions to my project. But as the time passed, and the momentum picked up, I got bolder. I realized that my concern about over-communicating was pretty much unfounded. People kept right on reading my emails and reposting my project link, even at the very end when I did a bit of a blitz. The fact is that people appreciated what I was doing. They either supported me or bleeped over my Facebook postings, but nobody ever said, “Hey – we’re sick of hearing from you.” So the lesson here is that to keep on tweeting and posting your little heart out. It’s not spam – it’s passion.
4. It ain’t over till it’s over, so stay the course and don’t lose your mind.
Contributions come in waves. At the beginning of my project, there was a lot of activity. I can tell you that it is awesome when those email contribution notifications pop into your inbox. And then they stopped. Then a few trickled in here and there. Some contributions came in after every email, or after someone shared my link with their larger networks. And then, with just hours to go, people came through and clicked that button to help me meet my goal. Face it: the contributions are probably going to be sporadic, but your communications and promotions must be consistent.
5. You got your money. Now go do what you said you were going to do!
OK – The project is over, and you got your funding. This is no time to sit back and relax. People made their contributions based on what you told them you were going to do. So hop to it! I’ve ordered my camera, and I cannot wait to get out and start shooting fun, informative videos, to promote the markets of New York City, to drive traffic to my site, and to provide the best information I can to my readers. I am remiss in sending out the VIP perks, which is unforgivable, especially for a person who writes thank you notes the minute I get home from a party. But I’ll get it done this week. I promise.
Since my project ended, I have looked at the list of contributors, and it makes me feel great. These individuals cared enough about what I do with Markets of New York City to help me make it even better. It’s a validation of my business, my writing, and the value I hope I’ve provided along the way. I have also become a bit of a crowd funding junkie. I’ve seen some great projects get posted by entrepreneurs in the market community, and I’ve contributed to all of them, as well as to several projects that I simply found compelling. I cannot wait to see who posts the next project and what kind of VIP perks they’re giving out. Hopefully it will be you!
And so I have become an evangelist for IndieGoGo.com. As such, I need to tell you about another wonderful small business project being conducted right now by two incredibly nice, talented, and brilliant people, Anton Nocito and Erica Rothchild of P&H Soda Co. They want to build out a commercial kitchen so that they can bring their handmade, all natural soda syrup to the market. It’s a company even Mayor Bloomberg could support. Please share the love and help them meet fund their small business – it’s ambitious, and if anyone can do it, it’s Anton and Erica!
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