Sometimes it seems that online communication is so easy. It doesn’t cost a thing if we’re just posting. Anyone can do it. And we can reach the whole wide world! And because of that, it seems that crowdfunding is an easy way to generate a lot of money for your nonprofit. It’s true, crowdfunding is definitely a good way to generate income for your organisation. But here are 5 reasons why crowdfunding isn’t easy money – and why it isn’t the easy way. Keep these in mind when you’re planning your campaign and it will make all the difference for your success!
1. For crowdfunding you need a crowd.
The Internet will get you anywhere in the world with your message. And yet, it’s not easy to reach people online. Not everything you post gets seen by all of your followers. (In fact, as little as 2% gets seen, they say). And if your post gets into your fans’ feed, they may not really notice it. And if they see it – they may not take action straightaway…
If you break it down that way, it’s not that easy to really mobilise people. It will be much easier if your message is amplified. For instance by followers with a whole lot of warm and active connections. So – with a crowd, you can reach a crowd.
So the first thing you need to do is make sure you have a crowd. And then you need to mobilise it to help you spread your campaign message.
2.For crowdfunding you need to be very good at your messaging.
You need to stand out in the sea of online posts. And your posts need to be good enough to instantly mobilise people to donate. That means you’ll need to have a very powerful and clear message. And you’ll need to package it in a way that speaks to your future supporters.
You need to know your people well. What’s important to them? How do they speak about that themselves? What words do they use?
Invite a group of people who are like the people you want to target with your campaign for a coffee and a chat. Tell them what you want to do and how you plan to present that. You’ll see that what you thought is a good message needs tweaking. Do it – and you’ll see it’ll work better!
Crowdfunding requires very constant engagement online.
Sending something out online is easy. Making it a good message that makes people want to take action is something you can work on and learn. But key in sharing things online, especially for crowdfunding, is your presence.
People don’t like the feel of a PO Box, an anonymous address where they cannot picture a house. They like to feel they’re dealing with a living person who responds to questions, likes comments, asks for ideas and cracks a joke now and then.
This type of engagement is also helpful to get more eyeballs on your posts, by the way.
So you’ll need to have people available to be active on your social media during the campaign. People who like to engage and converse. And who can translate feedback and questions received into new updates and posts for anyone to see and share.
This is really time consuming and often underestimated. If you plan this right, that’s going to help your campaign move forward so much better!
Crowdfunding requires extreme planning.
As you can see from the first three points: you need to start planning quite long before you want to launch your campaign. You need to identify your crowd and activate them. You’ll need to develop a powerful message for your crowdfunding page and for your starter posts.
Crowdfunding campaigns are usually a few days to a few weeks long. So it’s also helpful if you have an idea of actions and communications you want to do after the start. Maybe you can give each week a specific focus and prepare content around that aspect of what you’re campaigning for. It’s very helpful if you can write and create visuals in advance, so that your social media team can focus on creating a buzz and responding to what’s happening instead of on the sending.
These are just a few elements that require careful planning ahead of time. You’ll also need to think about rewards you might give to your sponsors. What are they? Who’s going to send them out? When? Who will check the incoming money? Who will look at the costs for the campaign and make sure you’re not spending all your money on the campaign?
Crowdfunding requires great transparency.
Talking about money. Crowdfunding campaigns are usually quite specific and clear about how much money is needed and what you’ll use it for. Donors expect that you’ll use the money as promised, and they like to be kept up-to-date on that, too. Crowdfunding money isn’t free money. It has a very clear earmark and is restricted to that purpose. If anything goes wrong in that respect, you’ll break the trust with your donors. And it’s not easy to win back broken trust.
Make sure you have a clear idea of how you’ll use the money. What will you do if you generate less than you target? What if you’ll generate more? Make a plan for how you can monitor use of the money. And for how you can update your sponsors and donors on that. Set up your systems for that monitoring and accountability before you open the campaign. That way, you can also share this with your crowd and that will make it easier for them to promote you, too.
How I can help
Check out my free resource Ten Tips to Make Clever Project Budgets: https://www.changingtides.eu/10-tips-to-make-clever-project-budgets/
If you want to be sure you’re handling your crowdfunding money properly, you can get my
- workshop Donation Received – Now What. A practical workshop that helps you develop your own policies for handling data and money related to donations properly and smoothly. It’s available on demand so you can jump right in and get it done today!
- bundle of 6 finance & admin foundations workshops. A practical bundle to help you set up basic finance and admin foundations for your nonprofit, such as financial processes, bookkeeping logic, documentation standards, cash flow projections, time sheets and fee calculations. It’s available on demand so you can jump right in and get started straightaway!
You’re also welcome to join my open Nonprofit Management Confidence Club and ask me anything – any time. Find out more here.
You can also check out my YouTube channel here, and find a collection of videos on fundraising and other nonprofit operations topics. Click here to watch 6 tips I learned from my crowdfunding campaign.
Want to know more and ask questions?
If you want to discuss this more and maybe share your donor outreach plans – jump into my nonprofit support community and get input from a wide range of peers and from myself!
Here is how you can join my free nonprofit support community
You can join my free nonprofit support community on the Heartbeat platform here. This group is a safe space for open exchange and discussion on potentially sensitive topics like boards, nonprofit management, fundraising, etc.
You can visit the community via a browser or via an app. Here is the link to download the Heartbeat chat app in the Google Play store.
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