Contents
- What is crowdfunding?
- Benefits of crowdfunding for business
- Participants in crowdfunding
- How to create a project on a crowdfunding platform
What is crowdfunding?
Crowdfunding is a mechanism of collective financing, where a group of people pools their resources to implement various projects. These projects can be creative, scientific, social, or entrepreneurial. Special online platforms are used to raise funds, allowing project authors to seek support from a wide audience. In business, crowdfunding becomes an important tool that helps not only attract financial resources but also promote products and increase brand awareness.
An example of successful crowdfunding is the coffee cooperative "Black," which raised over 1.3 million rubles on the Planeta.ru platform to open a roasting workshop, exceeding the originally planned amount by 300,000 rubles. This indicates that crowdfunding can not only address financial challenges but also open new horizons for business.
Benefits of crowdfunding for business
Crowdfunding allows solving several key tasks that can be useful for businesses:
- Attracting financial resources. When entrepreneurs face a lack of funds, they can turn to the community for support. This allows projects to be implemented even if their own resources are insufficient. If the required amount is not raised, the invested funds are returned to the sponsors.
- Diversity of reward forms. Depending on the amount invested, backers can receive various bonuses. These can be material gifts, such as products, or intangible ones, such as participation in workshops or exclusive events. For example, the "Black" cooperative offered investors the opportunity to attend a coffee brewing masterclass in exchange for their contributions.
- Attracting attention and PR. Crowdfunding allows businesses to announce themselves in the market and draw attention to their offerings. Successful projects can become a topic of discussion in the media, increasing visibility and interest in the company. For instance, the crowdfunding project "24 Lessons from Amazon CEO Jeff Bezos" became an interesting news hook for the business publication RB.ru.
- Assessment of public opinion. Crowdfunding serves as a sort of market research, allowing one to understand how interesting the project is to potential sponsors. If fundraising is going poorly, it may signal a lack of interest in the idea.
Participants in crowdfunding
There are three main parties involved in crowdfunding projects:
- Founders. These are the project authors who initiate the fundraising for its implementation.
- Backers. These are individuals or companies that support the project by contributing their money. They are also referred to as sponsors or investors.
- Crowdfunding platforms. These are online services that act as intermediaries between founders and backers, facilitating the fundraising process.
How to create a project on a crowdfunding platform
Before registering on a crowdfunding platform, it is essential to prepare thoroughly for the implementation of your idea:
- Set a clear goal. Define exactly why you need the funds. Specify what the collected money will be used for, whether it's purchasing equipment or making repairs.
- Determine the necessary amount. Calculate how much money you need to raise, considering all possible expenses, including platform fees and taxes.
- Establish a fundraising period. Typically, fundraising takes from one to two months. It is important to inform your audience about your project in advance.
- Consider promotion. Identify channels for promoting your idea, including social media, the press, and offline events.
- Choose a crowdfunding platform. Familiarize yourself with the terms of different platforms and select one that fits your project.
- Create the project. Post information about your project on the chosen platform, taking into account all nuances and requirements.
- Think of bonuses for supporters. These could be souvenirs, postcards, or a meeting with you, to encourage everyone who decides to support you.