Crowdfunding is a fantastic solution for entrepreneurs seeking much-needed cash.
No idea is worth a grain of salt if it lacks the financials to get it off the ground. That’s where crowdfunding comes into play. Before testing the waters, though, you’ll want to make sure you know these three things:
- First: Crowdfunding is a viable alternative to traditional banking. Do you lack the necessary underwriting criteria to qualify for a business loan? Not being an attractive candidate for a standard funding model does not mean your dream has to end. Instead, seek the capital you need by utilizing a crowdfunding approach. Investors are searching for folks with good ideas to back and support financially.
- Second: Once you’ve determined that crowdfunding is for you, research the various platforms available and choose one that suits your needs. The field is widening as newcomers such as StartEngine, Gigmor, CrowdBoarders, and SeedInvest, naming a few, are joining the ranks of more established and familiar platforms like GoFundMe, Indiegogo, Kickstarter, and AngelList. Each has pros and cons, and some even have niche audiences. For example, Gigmor caters to the musician and band market.
- Third: Anyone can launch a successful crowdfinancing campaign. But, to do so, you should avoid the major pitfalls associated with those that don’t succeed. Primarily, and, perhaps, most importantly, you have to articulate your vision clearly and specifically address your wants and needs. Potential investors would like to make informed decisions. To elaborate, see what Paul Resnikoff says in his piece from Digital Music News that appeared June 2nd, 2016. In it, he outlines the biggest mistakes of failed campaigns from his vantage point as a crowdfunding employee. Future crowdfunders would do well to heed his warnings for the best chance of success.
Your dream is closer than you think. Let crowdfunding help you realize it.
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