Don’t Make These 3 Big Crowdfunding Errors

Don’t Make These 3 Big Crowdfunding Errors

I’ve outlined the biggest mistakes founders make when crowdfunding. Take a look and prepare to avoid these common pitfalls.

Crowdfunding is a form of market validation and so when a campaign fails, it is often the case that the market opportunity isn’t there. On the other hand, we often see exciting businesses fail with the crowd because they made these common errors. If you’re thinking of crowdfunding, consider how you can avoid making these mistakes.  

1. You didn’t promote your campaign before launch

Founders often assume that platform traffic and in-campaign promotion will be adequate to raise the funding needed. This is rarely the case and promoting your campaign prior to launch is fundamental to crowdfunding success. I recommend spending at least 6 weeks implementing a marketing strategy to build your crowd.

2. You didn’t secure at least 30% before launch

If you have effectively promoted your campaign, prior investment is not always required. However, I always recommend securing some investment to feed into your campaign to encourage initial pledges and demonstrate your business or product as investable. In equity crowdfunding this is called “pre-committed” investment, in rewards crowdfunding this is guaranteed investment e.g. promised pledges from friends and family.

3. You didn’t set aside time to dedicate to your campaign

Finally, I often see founders put themselves under extensive pressure as a consequence of poor planning. Successful campaigns garner a lot of attention and failing to communicate to backers could be detrimental to your success. I recommend dedicating time every day to work on your campaign and fulfill campaign demands. This can ease the stress of a crowdfunding campaign and ensure your day-to-day business activities are not significantly impacted.