Last week, I attended the success party of UnderTheDoormat, a London-based sharing economy start-up, which manages Londoners' homes when they go away, earning them money and giving guests an authentic experience.
Many things – including a great idea: UnderTheDoormat manages the whole process of short-term letting people’s homes while they’re out of town, providing a hassle-free additional source of income from their most important asset, and looking after their home while they’re away. Of course, crowdfunding success also relies on a great team and a compelling pitch, all of which UnderTheDoormat has!
What makes a crowdfunding campaign work?
There are many variables to a crowdfunding campaign, but if I were to share one takeaway it’s this: crowdfunding is all about momentum.
The campaigns that don’t work, no matter how credible they first appear, haven’t established momentum. And they neglect to create small successes that lead to bigger successes. Successes that lead to a tipping point. That lead to getting fully funded. That lead to overfunding.
When you lose momentum in a crowdfunding campaign it’s very hard to get it back. I’ve often been asked to revive a flagging campaign that limped along on a crowdfunding platform. My usual advice is to quit and start again. It's already too late.
How do you create and sustain momentum?
1. Before you do anything else, assemble your core fans. That includes family, friends, employees, customers and any interested investors, however small. Ask them: Will you back me on my crowdfunding campaign? If so, how much will you commit?
2. From there, you can gauge what your starting point is and how many people have put their hands up.
3. Now check whether the amount committed by your fans makes up at least 40% of what you really need.
Once your crowdfunding campaign is launched, keep up that initial momentum: building, updating, connecting, pitching, responding, entertaining – and don't stop until the money hits your bank account.
I’m pleased to have guided many successful crowdfunding campaigns. Each one has created massive momentum from very small beginnings. It can be done. It’s hard work, but it can also be fun and highly rewarding as well.
So, if you’re thinking about your own crowdfunding campaign, first ask yourself:
“How do I build and sustain momentum?”