Financing Your College Business with Crowdfunding

StartupThis crowdfunding guest post is by Manuel Eriksen. Manuel is a business writer who specializes in marketing and public relations.

You have your class schedule, a stack of overpriced textbooks, and an unwavering conviction that 8 a.m. is a horrible time for any class. Alongside your class schedule, you’re also starting up a business that is taking up a good chunk of your time not spent on homework. You think you have something really good going on with your growing business, and you want to take it farther. The only problem is, for one reason or another, you don’t qualify for traditional financing options, such as small business association loans. Financial advisory service Deloitte predicts that crowdfunding platforms are going to raise $3 billion overall in 2013, so it’s certainly a viable option to help grow your startup.

Choosing a Crowdfunding Site

Crowdfunding is not a one-size-fits-all endeavor. Each crowdfunding site attracts a certain user demographic that has its own likes, dislikes and funding habits. Sit down, and research which site(s) your campaign has the most likely chance of getting funded on. It’s not always as simple as choosing the biggest crowdfunding site, Social Media Examiner says. Explore the culture of the sites, take a look at the most successful campaigns, and figure out exactly which site your project would do best at.

Creating Your Campaign

Your campaign lets your potential crowdfunding investors know exactly what you’re going to do with the money you receive from the campaign. You can create a broad campaign designed to help launch your entire business, or a more focused option that helps introduce new products or additional services. No matter what focus you take, make sure you define it specifically, so your core audience knows what you’re intending on doing. Social Times recommends coming off genuine in your pitch to add an air of veracity to the campaign. A quality campaign requires an investment of time and sometimes money, so you might consider selling structured settlement payments, taking out a loan or using a credit card to get the resources you need for your campaign.

Provide a list of rewards for your backers if you are crowdfunding through a site that encourages tangible rewards for investment. Don’t underestimate the generosity of your backers. Have a few flex goals ready to go if they end up exceeding the amount of money you’re looking for for funding.

Marketing Your Campaign

While some users are going to stumble across your campaign page through explorations of the crowdfunding site, in most cases, you need to go after contributors on your own. Leverage your existing marketing platforms, especially social media, to make your existing fans aware of your crowdfunding campaigns. Provide encouragement or incentive for fans who spread the word about your campaign.

Stay on Track

Once you’ve successfully funded your campaign, keep your backers up to date on where their money is going. Update the project with pictures and information on your business or product line, and explain any delays that may occur when getting the rewards ready to go. Bottom line: Keep your backers in the loop.

Image used with permission via Flickr user Lailson Bandeira.

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