Crowdfunding

Crowdfunding

Times have changed. Nowadays the world of entrepreneurship is no longer the same world that used to be few years ago. Different phenomena such as crowdfunding have affected the ecosystem of entrepreneurship in diverse ways. Crowdfunding has been a key element of support focused in entrepreneurs with great ideas who also want to be in front of a particular business.

Crowdfunding is a method of fundraising for small amounts and numerous contributors to fund a purpose, both profitable and free. Furthermore, it is becoming very common for being a method of easily access and fast results through internet platforms, both to implement ideas from entrepreneurs to finance social and charitable projects.

Crowdfunding also overcomes the alleged “clash” between new digital technologies and musical space (piracy, copying, downloading, etc.) showing that they are entities that can generate synergies and cooperation.

The importance of crowdfunding is that not all companies have access to the enough capital for the development of their projects (65% according to figures from Venture Partners); therefore the collective funding represents a solution to this problem (and also an input) capital aims to be used in the project.

In my opinion it's a different way to get help without going through dense filters in other entities. The crowdfunding is a much easier way to get economic support having only a good idea, development or project. Anyone can donate a small amount of money for it if they like the idea. At the same time, it could entail the generation of employment bringing benefits to the development of society.

There are several components to keep in mind before creating a crowdfunding campaign. For example: Presentation, How you present your idea and the way that you use to do it on your campaign page is likely more important than the idea itself. You have just seconds to grab the attention of your potential supporters. Other components are Innovation, quality, the right time, rewards.

But the most important components to have a successful campaign (key success factors) are:

- Clarify objectives, targets and time frame

It might sound obvious but it is important to clarify early on exactly what it is that you are seeking to achieve and share it amongst the team tasked with delivering the project. This is an important step because it should encourage you to come to an agreed position and also help bound the scope of your aims. It should make you realistic, and consider if this is a single project or perhaps a multiple project process, making the targets more manageable. As they say, eat the elephant bite by bite.

- Choose the right rewards

Another key element of operating in the online environment is the idea of lowering barriers to entry. You must be able to allow a diversity of funders to step in with opportunities for even very small donations being possible.

- Pitch and communication strategy

Having a well thought-through pitch is essential. Potential investors need to understand what they are involved with and why they should care. Being able to communicate and reiterate those key messages throughout the campaign is fundamental

- Video and other media

A video to promote a project is very valuable. In a rich media world people are readily attuned to rich visual prompts. We will get only limited attention time so video can convey more in a short space of time: one will say more in terms of message

...