Last week we talked about 7 reasons to launch a crowdfunding campaign. This week we’re going to change it up and get rid of some of the myths and thoughts into running a crowdfunding campaign with 7 reasons you should not launch a crowdfunding campaign.
- #1 No Crowdfunding video
By now you’ve hopefully done some research into crowdfunding. Maybe viewed a few Indiegogo or Kickstarter campaign pages. The first thing you would’ve noticed. A VIDEO!
I’m always being asked if you need a crowdfunding video for your crowdfunding campaign page. Absolutely yes. That Q&A is usually followed by can I use my cell phone. Yes and No. You can’t have a selfie video of you explaining your product for 8-10 minutes. You still need to think of a creative way to shoot your crowdfunding video. And keep it under 3 minutes. You’re 50% more likely to have a successful campaign if you use a crowdfunding video.
Here are 3 of our favorite crowdfunding videos.
- #2 No Following
A good friend of mine use to call this “Inventors Syndrome”. If you build it they will come. NOPE! That is almost never the case. You have to try and build a following, whether that’s collecting or building your email list, building a following on social media or whatever. You must have a following of some sorts.
It’s also very important that your following is not just Mom & Dad. As you build your following you should be asking them what can be better, what colors, etc…
You can build a following for your crowdfunding campaign several different ways. Paid ads probably perform the best in a short amount of time. But you can expect to pay $5-$10 a lead through Facebook or Google Ads. If you have more time (+2 months) you can try just using Twitter or Facebook to target people who would benefit from your product. Giveaways and promotions are another great way to build that early following.
- #3 You don’t have time
If you haven’t heard it takes a TON of time to run and manage a successful crowdfunding campaign. If you have a day job it is doable, but I hope you have some help if it goes viral. If you don’t put forth the time and effort that is needed for each crowdfunding campaign you might want to think about hiring someone to assist.
You can hire a firm like ours or you can even go out and hire Virtual Assistants to handle certain jobs for your crowdfunding campaign. Upwork.com is a good source for finding virtual assistants. Depending on their country of origin and the tasks you can usually find a good VA for $5 an hour.
Make sure you plan most of your time off from your day job during the first week of your campaign as these weeks are often vital to success. Start staying up an hour later to work on your campaign and waking up an hour early to do so as well.
- #4 You don’t know your shipping costs
#1 reasons campaigns fail to make money. A lot of creators don’t take the time to figure shipping costs. They guesstimate. If you’ve taken the time to contact manufacturers, take quality photos, make an awesome crowdfunding video. Why wouldn’t you take the time to figure shipping costs?
If you’re planning to ship internationally then decide which countries. Call the post office, call around and find a price. Weigh your product and make a list of locations around the U.S. (don’t forget Alaska / Hawaii) and get pricing for how much it will cost to ship.
Don’t forget about returns. In theory, you will get all your products from your manufacturer working and 100%. But that’s just a theory. You will have a defect rate so make sure you know the prices to return and re-ship a working product.
- #5 You’re Lazy
This is pretty much self-explanatory. If you’re lazy, you don’t hustle and don’t like to wake up early and get shit done. Then you probably shouldn’t be running a crowdfunding campaign. The amount of hustle and work involved is ridiculous. Ask any creator what’s the one thing they didn’t expect. They will say the amount of work involved.
- #6 Afraid to ask for $$$$
This is my biggest complaint about crowdfunding creators. A lot of times they’re too scared to tap into their network or even let their network know they’re running a crowdfunding campaign until they’re funded.
That’s not how this works. For you smaller campaigns, majority of the funding is coming from your network. If your network isn’t onboard with your campaign how are they going to share? Where will the “free” promotion come from? Testimonials, etc….
You can’t be afraid to ask for money. In fact, you should be drafting up messages to send to all your friends (individually) on Facebook and other social media channels.
Not messaging your network is a huge mistake. You’re an entrepreneur now, accept your fate and if you fail. Who cares, learn from it and re-launch. Your success rate goes up greatly with a 2nd campaign.
- #7 Get Rich Quick Scheme
Majority of crowdfunding creators fail to make any real money off their first campaign. Miscalculated shipping costs, expensive minimum purchase orders, and many other factors lead to this. You might’ve heard that if you’re doing it for the money, you’re doing it for the wrong reasons. YES!
You should be running a crowdfunding campaign to A launch a business or B launch a product. Not to get rich. Coolest Cooler was one of the biggest Kickstarter campaigns in the history of the Kickstarter platform. They’ve run into several problems since they received 66,000 backers. Shipping problems, and not to mention they went broke! That’s why they’re now selling their product for cheaper on Amazon in order to fulfill their Kickstarter backers orders.
Crowdfunding is a hard grind, not a get rich quick scheme. So if you’re running a campaign with thoughts and dreams of buying a new car with the winnings…. Think again.