One of the keys to an effective crowdfunding setup is to choose your funding site carefully, unless of course you choose the other option of building your own crowdfunding website.
Considering the fact that each of the major crowdfunding websites has its own set of rules and fee structures (you can avoid all fee costs if you set up your own WordPress website using a special crowdfunding plugin) , there are five basic steps to setting up your project.
5 steps to set up your campaign
1. The first step in setting up your project is to include detailed information about yourself, what your project is about, and how much capital you will need to complete it. Another tip is that it’s a great idea to include detailed information about what you’ll be using the money for.
2. You will need to set a time limit for your project. This limit can be from 1 to 90 days. Bearing in mind that the longer your project lasts, the more money you are likely to receive.
3. It is always a good practice to start promoting your crowdfunding project early to get as many backers as possible.
4. As sponsors donate funds, your money will be placed in an escrow account until the end of your project date.
5. As soon as your project reaches the deadline, the funds will be released to you. The exception to this is (with some crowdfunding sites), if you don’t hit your goal, you won’t receive any funding. That’s why it’s always advisable to look at all options, including getting your own crowdsourcing software plugin.
The best crowdfunding sites
There are many different crowdfunding sites available, the best way to find the latest and most popular ones is to do a search for ‘top ten crowdfunding sites’ this way you will find the most current sites available.
Main points to consider
As you have read above, there are many different points to consider when choosing the right financing site, I will explain a little more:
1. One of the main points to consider is the fees that the website will charge your project once it is finished. This can vary from site to site, but a general rule of thumb is that you will lose between 5% and 8% in fees. It’s always a good idea to keep this in mind before setting up your initial campaign.
2. Another important point to consider is whether the crowdfunding website will in fact not give you any of the funds in case you do not reach your goal. One idea here is to go with the site that will have slightly higher fees but will actually give you all the funds you raised, even if you don’t hit your goal (my preference).
3. It’s always good to consider payment options, definitely a plus if the website will accept PayPal payments and even better if they’ll also pay you your funds in PayPal.
4. My favorite option of course is to look for some software that can easily set up your own crowdfunding website with a few clicks of the mouse. This type of system will not charge any fees, you keep the lot!
I hope A Guide to Crowdfunding has been helpful to you.