Kickstarter might be the poster child of crowdfunding, but the space is vastly larger than you might imagine. And according to a recent report, it's ballooning like crazy.
If you're not familiar with the concept, crowdsourcing is a means to raise capital, usually over the Internet from people who believe in what you're trying to accomplish.
Research firm Massolution, a crowdsourcing consultancy, polled 308 crowdfunding platforms (who knew there were so many?). It found that in 2012 more than 1 million successful campaigns were held, raising $2.7 billion worldwide. Globally, crowdfunding grew 81 percent in 2012, compared with 61 percent growth in 2011. What's more, Massolution predicts that this year global crowdfunding volumes will reach $5.1 billion.
It's all great news for startups and small businesses looking for dollars, but hitting a crowdfunding home run is far from a sure thing. In fact, untold numbers of campaigns wind up flopping.
Brad Damphousse, CEO of GoFundMe.com, sees examples on both ends of the spectrum. His nearly three-year-old bootstrapped platform, which he expects to gross $150 million in donations this year, helps people raise money for everything from entrepreneurial projects, personal crises, creative endeavors, funerals and more.
Here's his advice for a successful crowdsourcing campaign.
1. Communicate clearly
Don't write a novel, but it's important to clearly define your goal. "Your visitors should have a clear understanding of why you need the amount of money you say you need," Damphousse says. If your project is important but writing isn't your thing, find a ghostwriter, English major, PR firm or someone otherwise gifted as a wordsmith.
2. Use compelling photos and videos
Videos give potential funders more to chew on.
If photos are good, video is better-but only if you have the talent and resources to create something people are going to enjoy.
"Videos can be more compelling, but they're also a lot more labor intensive to do well," Damphousse says. "Having a video is one thing, [but] having a video that someone is going to sit there for two, three, four minutes and actually watch the whole thing is quite another challenge. If you've got the skillset or somebody in your life with some simple video editing skills... it's not terribly difficult to put together a video, but it does take quite a bit more time than simply posting a photo."
Don't think you have the creative chops to pull off a convincing pitch? Find someone to help who does, either for free from a friend or for hire-it just depends on how badly your project needs the funds.
3. Leverage your social sphere
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