Training

How to start in crowdfunding?

A crowdfunding campaign requires an important preparation and follow-up work. Creating an account on a platform is not enough to raise funds.

The project author will have to commit totally to reach this objective. They can also ask the help of a “crowdfunding coach”, an expert who will support them in the preparation and the promotion of the campaign.

Steps of a crowdfunding campaign

Choosing one’s type of crowdfunding
The project author has to choose a funding mode. The form that the fundraising will take will depend on the type of project: charitable form, remunerated funding, non-remunerated funding.
The charitable form concerns fundraisings such as donation or patronage.
Remunerated funding included financial compensations (usually interests, but also participation with dividends or capital gain when shares are sold,
Non-remunerated funding included material compensations (the produced object, coupon, service, thank-you message, contributor’s name on the website...).

Setting one’s crowdfunding objective
The project author has to identify the amount to, be reached making sure not to set the bar too high and not to have too long a campaign.
If the announced objective is reached within the set period, the money is received.
If the objective is not reached, the campaign is cancelled and the investors are reimbursed. I this case the project author receives nothing (about 1/3 of the projects).
Some platforms still grant the amount even when it is below the objective.

Choosing one’s platform
There are many platforms. The project authors needs to sort it out and choose the one that matches best the nature of the project and of the targeted investors. The choice of platform is thus related to the adopted funding form.

Creating one’s crowdfunding file
The project author has to define their project in detail, gather proves that it is viable, the same way a business plan is presented to an investor.
Usually, the file includes a detailed business model, a market study, a strategic and financial analysis.
The file has to be validated by the platform to be the object of a fundraising campaign.

Preparing one’s page on the platform
The project author must be able to promote their project, make it attractive for investors, stand out from the competition.
A good crowdfunding campaign is often animated by a story (storytelling). The project author tells how they came up with the idea, the difficulties they encountered, how investors could help overcome them…
The tone and communication tools need to be adapted to the targeted investors (videos, photos, texts, tables, charts…).
Skipping the meticulous preparation of the campaign is the main cause of failures.

Giving life to the campaign
The project author has to set the length of the campaign and give life to it once it is launched.
It is observed that short campaigns (+/- 1 months) have a higher rate of success.
The more dynamic and lively the page (updates, thank-you messages, replies to comments, games and contests…) the more the campaign will be talked about among acquaintances (first circle), then on social networks and among influent bloggers (second circle) and finally by the media (third circle), the higher the chances to reach the objectives.

Online Resources

• Fiches pratiquesPractical sheets for heads for companies [in French].
• Réussir sa campagne de crowdfunding How to make a crowdfunding campaign successful [in French].
• La check-list à suivre pour réussir sa campagne de crowdfunding Checklist to make one’s crowdfunding platform successful [in French].
• Dix manières de rater sa campagne de Crowdfunding Ten ways to fail a crowdfunding campaign [in French].