Here is a great read by Chris Wayne, Contributing Writer at the Atlanta Business Chronicle. He shares some insights on the use of crowdfunding which frequently comes up in class. Veterans need to constantly seek out sources of funding. Crowdfunding has become more and more popular over time. It is a mainstream form of financing. New crowdfunding options become available on a regular basis.
Wayne writes---Since 2003, crowdfunding has promoted community involvement by attracting millions of potential investors and funding tens of thousands of projects nationwide.
In 2014, Kickstarter, the largest crowdfunding online platform, boasted 22,252 projects backed by $529 million from 3.3 million people. But can crowdfunding work for your business or nonprofit organization?
Businesses employ reward crowdfunding through the pre-launch sale of products or services to avoid incurring debt or leveraging equity.
From research and development to promotion, reward crowdfunding generates funds and builds a sense of ownership among project backers. This translates into positive buzz, improved trust equity and increased brand loyalty.
Some tips on how to successfully employ reward crowdfunding include:
~ Use an "all-or-nothing'' style: In this model, the business or nonprofit doesn't collect funds until the goal is reached. By crowdfunding this way, an enterprise or organization builds trust and strengthens loyalty.
~ Specify the goal: Concrete, detailed plans and goals generate better responses from potential backers. They commit only when they know and understand what they're backing.
~ Respect your backers: Be honest with the people who are willing to invest in you, your idea and your plan. Share as much information as you can regarding your project. Thank your backers every chance you get, and deliver what you've promised.
As a Tom Coughlin Jay Fund Foundation staffer, [ have personally seen crowdfunding's impact. Through several individual and business crowdfunding efforts, we've been able to help families tackle childhood cancer by raising thousands of dollars.
Additionally, we've seen businesses benefit from building community trust by using charity crowdfunding as a cause-marketing tool. Some insights on making your charity crowdfunding efforts successful include:
~ Choose a local charity: By choosing a local organization, you create a triple win for all of those involved: the local community benefits from the funds generated, the local organization gains community exposure and you build additional local trust equity.
~ Specify the goal: Again, specificity is paramount. Work with the organization to raise funds for a specific item or program for which they need assistance.