Guest post by Alon Hillel Tuch
Crowdfunding is a new way to gather support for creative projects and entrepreneurial endeavors. With the advent of modern social networking (and sites like Facebook, Twitter, LinkedIn, etc.), we are more connected to our extended network of friends and supporters than ever before. At RocketHub, one of the world’s largest crowdfunding platforms, I have seen hundreds of projects raise funds and awareness via this new form of micro-patronage. What I find most exciting about a platform such as RocketHub is the variety of projects, from a one-man-band in New York to social entrepreneurs in Panama.
Crowdfunding platforms can offer the credibility and infrastructure necessary to successfully harness the financial power of the crowd, but because crowdfunding is a new trend, many people misunderstand how to effectively leverage the tools available to them. This is something I have seen consumers do on our site as well others such as Kickstarter, and IndieGogo. When undertaking a crowdfunding project of your own, be sure to avoid these common pitfalls:
- Setting an unrealistic fundraising goal: “Internet Angels” (wealthy strangers trolling the internet looking to give away large sums of money) are the exception, not the rule.
- Underestimating the importance of marketing your project: The assumption that “If You Build It, They Will Come” (simply posting to a crowdfunding platform and expecting contributions) is a conviction, as our COO would say, “best left to Kevin Costner movies.”
Crowdfunding only takes you so far. RocketHub wants to empower the people behind the projects, and leverage their social networks to get more done. For example, right now we are hosting on our LaunchPad Opportunity™ platform a unique opportunity for musicians: The Gibson Guitar Music Retreat. The retreat will be hosted at the prestigious Gibson/Baldwin New York City Showroom located in Midtown Manhattan. Once known as the Hit Factory, this historic location is where Bruce Springsteen, John Lennon, Michael Jackson, Paul Simon, Tony Bennett, Madonna, Jay-Z, Santana, Sting, Barbra Streisand, U2, and Stevie Wonder cut their hits. Next month we will be featuring a photography opportunity, followed by a gaming/app opportunity. These opportunities are available for free to anyone who has successfully crowd funded on our site; otherwise a nominal fee is charged.
Crowdfunding is hard work, but it can be very rewarding, both financially and socially.
Here are 5 Tips for Crowdfunding Success:
1. Build a Team
Crowdfunding is a team sport. Success will require help from your friends, family and wider network. Make a list of your teammates, including direct collaborators, high impact financial contributors, and broadcasters (press contacts and social leaders) who can spread your project to wider circles.
2. Create a Great Project
Make sure that your project is worthy of your time and other people’s attention. Why is your project important to you? If your answer is powerful enough it will resonate with you and others.
3. Prime the Pump
No one wants to be first on the dance floor – it’s equally true in Jr. High School and in crowdfunding. Your first wave of contributions will demonstrate that your project has the momentum necessary to reach your fundraising goal. Before your project goes live, ask your closest friends and supporters to contribute early.
4. Spiral Outward
After securing your first wave of contributions, reach out to wider circles of friends. Thank supporters publicly, via social media, and celebrate the milestones you pass. Keep your connections talking about your progress and encourage them to spread the news through their respective networks.
5. Meet the Press
Once your project has momentum, follow up with the broadcasters mentioned above. With the social proof of your network’s support, your project is ready to meet a larger audience.
For more information on how to run a successful crowdfunding project, visit RocketHub.com.
By Alon Hillel-Tuch – President & Chief Financial Officer – RocketHub
Alon grew up in The Netherlands, and speaks English, Dutch, German, and Mandarin Chinese. Prior to RocketHub, Alon worked at BCMS Corporate (an M&A Advisory firm). Alon has enjoyed working as a strategic digital consultant with a variety of startups to help get their feet off the ground. He earned a B.A. from Hamilton College in Economics, and minored in Chinese Culture & Language. Alon is currently a M.Sc. candidate at Columbia University and was the recipient of the Advanced Consortium on Cooperation, Conflict and Complexity (AC4) Graduate Fellowship from the Earth Institute at Columbia University.