The five Cs of a successful crowdfunding campaign
Tuesday, 27th August 2019 at 8:16 am
In the last few years crowdfunding platforms have raised billions of dollars worldwide, so it’s no surprise that social enterprises, not for profits and changemakers are turning to crowdfunding to raise money for their initiative or cause. But what makes a campaign successful?
Speaking at the Social Traders conference in Melbourne, Tom Dawkins, CEO and co-founder of crowdfunding platform StartSomeGood, shared his top tips for launching a successful crowdfunding campaign.
He says where people often get confused is in thinking it requires a niche skill, that is only relevant for the particular act of launching a fundraising campaign.
In fact, it is a core skill for all social entrepreneurs based on articulating your vision and impact, identifying your audience, mapping the channels and conveying the right credibility.
“In other words it is all the things you need to do to successfully launch anything,” Dawkins says.
It can be broken down into five easy to understand Cs.
Clarity is the ability to convey really powerfully what is the impact you are creating and the value you are offering.
It is what allows people to understand your vision. Without it, it can be hard to bring people with you.
If clarity is what helps people understand you, credibility is what allows them to believe you.
“This is often the piece that is lacking for a lot of people,” Dawkins says.
The good news is, if you don’t have that credibility in and of yourself, there are ways you can engineer that.
Dawkins sums these up with five Ps: progress, people, partners, promises and past.
In a crowdfunding sense, one of the most credible things you can have is money already pledged – if you have $30,000 on the board, people are going to take you seriously.
Connected to both clarity and credibility, Dawkins says his personal bugbear is that people often choose the wrong model of crowdfunding.
There are two main models: keep what you raise or all or nothing. The majority of people choose “keep what you raise”.
But Dawkins says it is an ineffective way to raise money, because it prevents you from having clarity around what it is you are going to do and it prevents you from having credibility.
“If you are telling me you are taking my money irrespective of your ability to deliver, I don’t want to give you my money in the first place,” he says.
“That’s why even the worst performing ‘all or nothing’ platforms outperform the best performing ‘keep what you raise’ platforms. While everyone wants to keep what they raise, you should be focused on what’s going to help you raise in the first place.”
This means carefully chosen communities. In other words, thinking about your audience, and who is the right person to deliver your story to.
“If I ask you ‘who is this for’ and you tell me ‘everyone’, what I’m hearing is ‘noone’,” Dawkins says.
He says one of the key mistakes people make is acting as if the crowdfunding platforms are the source of their supporters, rather than the toolset their using to engage supporters.
“You have to figure out who your supporters are for yourself,” he says.
“That’s true across any fundraising platform. People don’t wake up in the morning and proactively decide to go looking for things to give money to.”
The key is to engineer different hooks to connect with people around things they already care about.
Dawkins uses the example of a social enterprise food truck creating employment opportunities for homeless people. While you might be passionate about creating pathways out of homelessness, your audience doesn’t need to be passionate about that to want to support you. They might be excited about food trucks, or North African cuisine or social enterprise.
“It is about finding the right hook for the right audience to connect them and bring them back to your overall story,” Dawkins says.
Put simply, this is mapping the specific delivery tactics to get your story to your chosen community.
The last C is for courage. Dawkins says it is always the most heartbreaking thing when people have the other Cs but lack the ability to put themselves out there and share their story.
“Sometimes that’s because they’re wonderful, humble people who don’t want to make it about themselves, they want to make it about the beneficiaries, they want to make it about the cause, but you don’t get to do that in crowdfunding,” he says.
“It is about you. Because we’re putting our faith in you to deliver the outcomes that we’re giving you money for.”
One final tip
If you’re wondering about the perfect length of campaign, Dawkins recommends 30 days.
The reason being that in any campaign nearly all the funds are raised in the first week (building on the energy of the launch) and the last week (people love a deadline).
“If you add more time… you don’t get any more launch week, you don’t get anymore deadline week, you just create this massive trough between those points which will burn you out, more so than your community,” Dawkins says.