There are many ways to take an idea and grow it into a thriving small business. A lucky few can get their concepts off and running with the backing of family and friends, while others work with professional finance companies like Dealstruck Small Business Loans to research lending options. There’s another approach some industrious entrepreneurs are taking to reach out to the public before their business has even moved beyond the planning stage. Thanks to the Internet, it’s known as crowdfunding. While it may seem like an intimidating process, the extra work put into a crowdfunding campaign is a proven tactic that can keep you on course and help your business to hit the ground running.
Just like any other phase required to establish a business, it isn’t going to be easy and will necessitate a significant amount of time spent on effective marketing. You need people to trust that your brand holds water, and you’re not running some fly-by-night scheme. This is the opportunity to showcase all the hard work you’ve invested to date and how their valued contribution will be rewarded once your business is fully funded and operational.
A major struggle for many businesses when they are first starting out is establishing brand recognition. Even then, most consumers will hesitate before conducting business with a company that hasn’t managed to garner any reviews yet. With crowdfunding, you can solve these problems by putting your product name in the marketplace and building up a potential customer base upfront. Reviews rack up and legitimize your business early on.
When you invest time and money into a crowdfunding ad campaign, it’s imperative that you formulate a responsible business plan. It’s easy to get caught up in the buzz and excitement that your idea generates. However, crowdfunded businesses aren’t immune to poor financial planning and practices, ending up bankrupt even when they have had hugely successful crowdfund backing. Business owners must be committed to deliver on the promises made to those who funded them. Crowdfunding injects additional pressure into the process, but if your business is confident in what it can produce, then the faith people bestow in you should fuel your motivation.
Know you’ll also have to be prepared to offer more than just your base product when it comes to crowdfunding. You should consider a limited time reward for those who contributed and believed in your vision early on. If you’re only willing to give them what any other customer can ultimately buy, then there’s less incentive for crowdfunding investors to contribute when they can just wait to make the same purchase as the general public. Offer exclusives such as early access, additional items commensurate with the size of their donation, or even the opportunity to see the inner workings of your fledgling company.
Setting out on your own to build a business isn’t for the faint of heart, but you’ll find that there are large segments of the Internet population rooting for you. Many of those cheering you on are willing to go a step beyond to support deserving self-starters who exhibit the entrepreneurial spirit that’s driving the economy. Crowdfunding is a phenomenon you can leverage to help realize your vision while taking Internet strangers along for the ride. It’s a massive amount of added responsibility and accountability, but crowdfunding may just be the glue that keeps your plan on track.
About Carson Derrow
