Crowdfunding 101

Fund Local Biz | Crowdfunding Platform

Crowdfunding is an alternative, legal method of raising money that continues to grow in popularity. In a nutshell, it involves soliciting small amounts of money from a large group of people via the Internet using social media. The best part about FundLocalBiz crowdfunding is that unlike a bank loan, there is no interest and you don't have to pay back the funds. People crowdfund for just about any purpose, be it for business, charitable or personal. Businesses can use crowdfund to pay for expenses associated with a new venture, or to generate additional revenue. While funding isn’t guaranteed, there are important best practices that you should know which can significantly increase your chance for success. For example, posting a video and including great rewards will increase you chance of reaching your goal by over 50%.

We created this guide to help you succeed at crowdfunding. Now it is time to take a deep dive into the specifics of a successful crowdfunding campaign.

Here’s What We’ll Cover:

The Crowdfunding Life Cycle
7 attributes of a great campaign / essential to winning.
The Crowdfunding outline / your check list to succeed.
7 Steps to a Winning ‘Pitch.’
Power points / focus your pitch.
The video pitch / why you need it.
Set your timeframe / timing is everything.
Marketing to the crowd / publicize it!
Social Media Strategy / Build and grow your Fanbase.
Good salesmanship / & the first impression.
Rewards / what you need to know.
Budgeting / how much will you need?
Assess your crowd’s worth / how much can you raise now?
How to determine your funding goal and funding option.
How to handle objections.
Power points to close the deal.

1. The Crowdfunding Life Cycle

To succeed at crowdfunding you need a strategy. Understanding the three critical phases of a crowdfunding campaign is key to success. Each phase requires proper planning, execution and management. To take advantage of your unique crowdfunding opportunity, you need to understand each phase, and develop an action plan for each one.

To better your odds for realizing your funding goal, take phase one—research, planning and development—seriously. Do your home work and take the necessary time to plan your strategies before you go live in phase two. Let us begin by looking at a snapshot of a well planned crowdfunding campaign.

Phase One. The Pre-launch: Research, planning and development. The most important phase. Develop a clear vision about who you are and what your campaign is all about. Identify your target audience. Develop creative marketing components with your target audience in mind (campaign tone, sales pitch, copy writing, images, video, and rewards).

Research and compare similar projects. Compare funding goals, rewards, copy written elements, video pitch, contribution price points and online marketing tactics. Based on your research findings, develop your unique selling points and strategies.

Establish a start date and end date for your campaign. Setup your marketing channels (social media channels, web site, email list of potential contributors, publicity, and local and / national media contacts). Make the initial contact to introduce yourself and upcoming campaign to your audience and media contacts. Include your crowdfunding campaign start date on all your marketing communications. Fortify your campaign by establishing credibility—expert interviews, expert / celebrity endorsement and testimonials, affiliation with a known brand or organization; don’t forget to highlight your personal expertise and legitimacy too. Lots of homework at this very important stage. Time frame from 30 days to six months.

Phase Two. Implementation, Communication & Management. Follow up on the contacts you’ve made in phase one. Let them know your crowdfunding campaign is live! Invite them to be a part of this fantastic journey via their support. Continue your marketing communications efforts stressing the urgency, and unique nature of your project and / or practical value of supporting your campaign. Set aside ample time each day to manage your campaign. Activities should include finding new leads, managing your social media channels, answering questions in your comment section, and thanking supporters. Constantly update people on your progress on FundLocalBiz "Update" page, and by other means, e.g., Twitter, Facebook, LinkedIn, email, YouTube, etc. Evaluate the results of your efforts. Make changes if necessary to achieve better results. Average time from 30 days to 45 days.

Phase Three. End of campaign: Closing, Evaluation & Transition. Follow-through with all your promises. Publicly acknowledge supporters on your web properties. Personally thank them via a hand signed letter, and / or phone call. If successful, we hope that you'll realize your dream. The end of your campaign should naturally transition into the beginning of your actual business. The buzz and exposure from your campaign, combined with your new capital, will enable you to grow your business.

If you were not able to reach your funding goal, evaluate your efforts. Ask your supporters for their feed back. In the process, you might discover where you went wrong. Perhaps you can revise your strategies and start another crowd funding campaign in the near future.

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2. 7 attributes of a great campaign / essential to winning.

The former campaign snapshot is a macro look at all the tactical elements involved in operating a crowdfunding campaign from start to finish. Now lets take a closer look at a winning campaign. There are seven important attributes common in all successful campaigns. When planning your campaign, try to incorporate as many of these attributes as possible.

The Big Idea. Your big idea should be simple and easy to communicate. An uncomplicated yet clever idea for a cause, product, service, or artistic endeavor is essential. If you have an ordinary project, you will need to do something extraordinary to stand out. Be creative and think outside of the box. Look at successful campaigns for inspiration.
Create Awareness. Develop a media strategy based on your “big Idea” to create awareness. A strong marketing communication plan which emphasizes social media at its core is essential. But don’t leave out traditional media.
Credibility. Establish integrity and credibility. Let potential supporters know about your credentials. This will establish the credibility and confidence needed to gain their trust. For example, explain and showcase your expertise, or if you are affiliated with an established organization let them know about it. Solicit experts in your field. If you can get an industry expert, celebrity, or political leader to support your idea it will enhance your credibility. Include testimonials, endorsements, interviews, and petitions if available. Cite credible sources. Conduct research to support your cause; this can be published research or surveys you’ve conducted or both. The Internet is a great place to start. The more data and facts you have to support your idea the better your argument. But don’t bore them with too much information. Stay on point. Cite a few credible sources that will prove your main point and strengthen your case.
Market Knowledge. Know your audience and industry. This is your target market. You should know their likes, dislikes and what makes them tick. For example, are they young city hipsters; new adapters to the latest technological gadget; hardcore video gamers; suburban moms; avid foodies; or ultra conservative couples living in the Midwest. Tailor your message accordingly so that it will appeal to your target audience. As important, knowledge of your industry is vital. You should know who the main competitors are; your industry’s growth potential; current market opportunities you plan to take advantages of; and government regulations and other legal concerns.
Value Proposition. You must answer the question “what’s in it for me?” The answer to this question could be some sort of reward or perk. It might be something intangible that will appeal to your audience’s sensibilities. For example, like contributing money to a social or environmental movement. In either case, your value proposition should be unique and perceived as a valuable thing to your target audience. It should also differentiate you from other similar campaigns.
Broad Appeal. Go for that mass appeal. A surefire way to reach your funding goal and go beyond is by appealing to a mass audience. A large audience means a greater number of potential supporters. A catchy YouTube video will do the trick at spreading the word so to speak. It’s a numbers game, the more people that hear your sales pitch the better your odds.
Time-Sensitive. Have a sense of urgency about your campaign. You need to answer the question “why now?” Convincing people (friends & strangers) to contribute to your campaign now is key. Your campaign’s sales pitch and copy written elements should answer the "why now" question.

3. The Crowdfunding outline / your check list to succeed.

With the above groundwork covered, lets exam the specifics of your campaign. The outline. Your outline will be the blueprint to a perfect campaign. Answers the following questions to create your outline.

What—is the name of your project? The name you include for your project when setting up your FundLocalBiz site will appear in your crowdfunding site’s web address. For example, if you name your project “Eco-Friendly Food Truck”, your web address will be fundlocalbiz.com/campaign/eco-friendly-food-truck Keep it short, make it memorable and to the point. In your ‘Project Description’ area that follows your project’s name you can add a catchy tagline, give more information and address questions 2 to 12 that follow.
What—is your project. You’ll need a short, medium, and long description of your project: a) a creative catchy tagline that’s one to two lines long; b) a short and compelling summary of your project that’s about one paragraph long; and c) an informative description of your entire project.
Who—are you. Briefly introduce yourself and your team (if there are more people involved), and describe the main points of your campaign in as few sentences as possible. Also, mention where your project is located if applicable. Share some relevant information about yourself and team as it relates to the success of your project. You want to share relevant, credible information that will earn your backers’ trust.
Why—the need? Convince people as to why they should support your cause? Think like a backer. What would make you support this campaign?
What—makes your campaign unique? What sets it apart from other similar projects. Let them know what makes your campaign special.
What—is your timeframe? a) In what timeframe do you wish to achieve your fundraising goal, i.e., the start and expiration date. Also, b) explain how much time you need to complete the actual project you are raising funds for.
What—is your project’s funding goal? How much money do you need to complete the project? You will enter this amount as your ‘Project Goal’ when you set up your account. Make this goal achievable. Don’t ask for more than your social networks can afford.
How—will you spend the money? Make a realistic itemized budget for how you will spend your new funds.
What—are you offering in exchange for their money. Create your rewards menu. Make an attractive list of all the rewards and perks you wish to give backers. Rewards are things that entice people to donate money. Offer great, must have rewards. Feature exclusive, unique things that will be meaningful to your audience.
How—you plan to keep in touch with supporters. Let them know how you intend to keep them informed. The easiest and best way to keep backers up to date is from your crowdfunding site. Use the blog feature on your FundLocalBiz crowdfunding site. Other methods could include email updates, newsletters, and social media sites such as Facebook.
Other elements a campaign should include: Images, a video, product specs, diagrams, charts, a project blog, and an FAQ (Answers to frequently asked questions).

Your outline will help you create your FundLocalBiz crowdfunding site. It will guide you when writing your campaign’s title, description, highlights, FAQs, and fine print. The outline will also help you create the all important sales pitch.

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4. 7 Steps to a Winning ‘Pitch.’

The Sales Message, aka the ‘Pitch’. The icing for your cake. The sales pitch will make or break your fifteen minutes of fame. It should address the questions and concerns in your campaign outline. Your sales pitch is an intriguing introduction that makes one want to cotinine reading. It's an enticing summery of your campaign. It should inform, excite, and persuade your audience to contribute to your cause….NOW! Your pitch must grab and retain their attention from start to finish. This will be the first impression you’ll make on prospective contributors. You have to get this right.

Your pitch should clearly explain the most important details of your campaign, albeit in a compelling way, within a short time frame. Don’t assume that your audience will be interested in your campaign just because you are interested in it. You have to demonstrate its practical value, as in why they need to support your campaign. Rather what's in it for them. If you fail to do this, you will not hold their interest. Take the information you’ve composed during the ‘Campaign outline’ and Attributes of a great campaign’ section and fine-tune them with the following tips.

Grab their attention. Write your pitch with the objective of getting the already taxed attention of potential contributors, especially those outside your personal network. You will only have a few seconds to do this. Grab their attention from the start. Your opening statement should be provocative, irresistible to your target audience. It should be something so clever and true that your audience will want to learn all about it. What would they want to hear? What problems does your campaign solve? How will your product make life more enjoyable? What practical value is your campaign proposing? Talk to your target audience, i.e., friends and family, for their feedback to see the situation from the customers’ and contributors’ perspective. I’m sure with a little research and brainstorming you’ll come up with a spectacular creative angle.

Keep their attention. Keep on point, and don’t stray from the subject. You don’t want to bore your audience. Keep it short but interesting. Support your opening statement with the relevant facts, benefits and features about your product and campaign. Use an illustration, dramatization, or real life experiences. Make mention of any endorsements, testimonials, and letters of commitment. Incorporating these elements will help keep their attention, enhance your credibility, positioning you as an expert on your subject.
Quick and convincing. The pitch should clearly, cleverly, and quickly persuade your listener with reasoning and facts. It should answer the Who, Why, How and What’s in it for them questions. It should address common concerns and overcome objections to donating.
Communicate in everyday language. The typical crowdfunding contributor is not a professional venture capitalist; they are regular folks that want to get involved and make a difference. A campaign that can easily described “what it is, wants, and what’s in it for the contributor” to the general public will have a good chance of appealing to a broad audience.
Target your message to the right audience. Your sales pitch should be composed with a specific audience in mine–one that cares for your type of campaign. Once you’ve gone through the people you know, your second most receptive group will be your campaign’s actual target audience. For example, If it’s a creative project, e.g., movie, theater arts, tailored your message to the specific creative community; Technology to its unique community; A food service venture should be targeted to the local community. Concentrate your marketing efforts to reach your campaign’s target audience for mass appeal.
Have a sense of urgency. You need to convince people (friends & strangers) to contribute to your campaign NOW, and that by doing so, they will be part of something big, and receive great rewards in return. The main goal of your pitch is to persuade your listener to join your cause by giving their financial support.
Ask for the contribution. Close your sales pitch with a call to action; tell them what you want them to do now.

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5. Power points / focus your pitch.

We cant tell you what to write, but just remember the above tips, and continue to be passionate about your cause. Keep it short and simple. Write, practice, and refine your pitch. Test the strength of your sales pitch. Try it out on friends and family for their feedback.

The pitch is your sales message with a call to action. You are calling on your personal network to take action, e.g., to contribute and ‘join’ your cause. Change your pitch if necessary to achieve the desired result. Make your personality, or unique brand image resonate. Your pitch will be in written copy, and should also be composed into a video pitch.

Most importantly, if you can convince people that they’ll directly play a part in helping you do something special, this is the essence of a successful crowdfunding campaign.

6. The video pitch / why you need it.

We all know that a picture is worth a thousand words, well imagine the impact from a typical 2 minutes by 60 still images per second video. Crowdfunding campaigns with a video pitch raise more money—Like 2 to 4 times more over non-video campaigns. That’s a big deal! A YouTube video or slide show from flickr can easily be embedded into your crowdfunding page. As a general rule a video pitch should be no longer than two minutes; if however, you need more time to explain a complex campaign, a longer video will be necessary, but be cautious. The video pitch could be a personal video, animation, a chalkboard write up, a flickr.com slideshow presentation, PowerPoint, scrolling text with a voice over, or full on Pixar like production.

You don’t have to produce an expensive professional video, but it must not be poorly lit, choppy, shaky, and difficult to hear or view. Regardless of your production points, a good video pitch should adhere to the guidelines mention in the above Sales Message, aka Pitch section.

Unlike a static text sales pitch, a video gives you several advantages at making an appeal:

You can get personal. And you should. Personal videos with you talking directly to your audience raise more money than non-personal crowdfunding video.
Audio and visual aid. Your audience can see and hear how passionate you are about your campaign. You can look them in the eye and make your case. Take your audience on a tour, tell your story, show your product, show rewards, and create a mock-up of your idea. Show rather than tell—that’s what sell.
Demonstrate. Perform a product demonstration; do before and after shots; do interviews. Demonstrate your professionalism and expertise.
Entertain. Take advantage of the most important feature of video. Create an effective yet entertaining sales message. If you want your campaign to appeal to the masses, and go viral, you have to come up with a unique, fresh, and kick #$!!*&@ video. This holds true regardless of how unique, and special your product, service or cause is. Time invested in the creation of a dynamite video will have a positive lasting impact on your campaign plus future ventures.

Power points / focus your video pitch.

Before you develop your video, write a script and create a storyboard for the video. The storyboard is the blueprint for your video script. The video script should describe and illustrate the problem, the proposed solution, and how the money you’ll raise will be spent. Your video should illustrate all the elements your crowd funding outline and pitch in a clear, compelling, and hopefully entertaining manor, depending on the fundraising campaign criteria.

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7. Set your timeframe / timing is everything.

We can’t tell you what your timeframe should be. It all depends on if you want to create a sense of urgency, need ample time to raise awareness, or your actual ‘project’ is one time only. Campaigns range from short—30 to 90 days—to long—90 to 120 days or more. The shorter the time fame it seems the more successful the campaign is at reaching and / or surpassing their funding goal. The short timeframe can create a sense of urgency, e.g., get in now before the campaign ends. A short campaign can work, albeit with one big caveat. It works well when marketing efforts begin well before the launch of a crowdfunding site. (More reason to have a strong pre-launch strategy). The pre-launch phase is where you can create awareness for your upcoming campaign. This buzz builds once the crowdfunding site is launched. If you have not started to promote your cause, and don’t have potential contributors lined up, we advise having a longer campaign. It will give you enough time to get your sales message in front of as many people as possible. More people hear your message, the better your odds of reaching or surpassing your funding goal.

8. Marketing to the crowd / publicize it!

Start immediately by making a list of all the people you know that might be interested in your campaign. Don’t exclude anyone, everyone you know is a potential backer. Spread the word. Let everyone know about your fund raising need during your pre-launch and especially when your campaign is live. You’ll be surprised at the amount of people you know. According to a Reader’s Digest survey the average American knows over 400 people. Starting with your family and close associates and not stopping there. Be prepared to contact them asap once you’ve prepared your crowdfunding campaign. The majority of your first contributors will come from the people in your “center of influence”. This is your ‘fanbase.’ These are the people you know and see everyday (in person or on online), groups to which you belong; family, friends, neighbors, classmates, co-workers, religious affiliates, people who work at businesses and places you frequent. They will be your biggest fans helping to publicize your campaign to their friends and fanbase. You know them well, e.g.—what they like and dislike. This knowledge will help you determine your campaign’s style (serious, humorous, tong-and-cheek, edgy, etc.). Use this insight to determine comfortable monetary pledge amounts and suitable gifts.

Publicize Your Campaign! Selling your campaign should be your number one priority. Use every public relations, marketing and sales tactic and tool. Get started right away by doing the following:

Email. Emails are the key to an effective campaign. According to The Direct Marketing Association an email list has the highest rate of return among all direct response methods, and it is twice as effective as search engines. So collect as many emails as possible, via in person, and online thru your web site properties. Email your contact list regularly: first for your pre-launch (introduction and reminder of actual launch date to gauge level of interest), at the launch of your campaign (special invitation to visit your crowdfunding site and be an early contributor–consider giving a special gift for early supporters); regular up-dates about your accomplishments with an urgent message to help find more contributors; and at end of campaign acknowledge and thank your supporters. Continue to stay in touch with your new fanbase.

A powerful branding and marketing tool is to add a signature link at the bottom of your email that directs recipients to your crowd funding site and your other web properties. Think how many emails you send out and receive each day. You can even add your logo, banner, an opt in link to your newsletter or blog, and a compelling tagline for your crowd funding campaign.

Internet & Social Media. Use social media to the max: Post your Crowdfunding URL on Facebook, MySpace, Twitter, LinkedIn, YouTube, Trip Adviser, Yelp, and any other social media platform. Put a link to your campaign on the homepage of your web site and on your email signature. Post your campaign info. with links to your crowdfunding site on free online forums, especially local sites and the forums pertaining to your type of campaign. Contact popular web bloggers who write about your type of project. Send them your press release.

Search Engine Marketing. Millions of people search the Internet for products and services daily via search engines. With the hundreds of search engines online, however, 98% of all traffic comes from the top ten search engines. Submit your crowd funding URL and all your other web properties to the top search engines. Also, make sure your web properties are optimized (with great descriptive content, well placed key words, title pages, and tags) to achieve a high search page rank.

The Media Press kit. Don’t leave out traditional media such as local news papers, magazines, radio, local TV / cable stations. If its newsworthy don’t hesitate to go to the press. Local news channels and newspapers are always looking for great local stories to feature. Contact popular Bloggers and tell them your story idea. Your press kit is a collection of pre-packaged materials you send to members of the media, including beat writers, and journalist.

A press kit includes a fact sheet, bios, product pictures, and any other supporting information. The most important element in a press kit is the news release. A news release is an efficient way to announce news about your crowdfunding campaign to a large audience. It is a newsworthy statement written by an individual or organization to grab the attention of an audience. A release can be targeted at potential buyers, journalists (mainstream media or industry specific editors / writers), ordinary consumers, investors (professional or everyday ‘crowd-funder’ / project backers). In any course, you will be sending your news release to a member of the media that represents a particular audience. Your goal is to make your story stand out amidst all others. Your challenge is to persuade the media to cover your story. Your news release is a great way to generate free press, both online and off. A journalist takes information from your press release to create a news story about you, your product or crowd funding campaign. You can also submit your news release to an online press release service to instantly deliver your release to the media. Some are free, others are fee based. For a list of free and fee based places to promote your crowd funding web site, including news release delivery services go to Free Publicity for more information. Form more information on how to write and distribute a press release.

Marketing collateral. Print business cards, flyers, car magnets, and bumper stickers. If you have a physical location create a poster or banner to display your crowdfunding campaign. You don’t need to go crazy here, focus more on online marketing activities.

Power points on marketing communications:

Compose your campaign message in a manner that is professional, honest, clear, compelling, practical and interesting. Try not to sound desperate (like you’re begging); And leave gimmicks to the used car salesmen.

Use an IMC (Integrated Marketing Communication) strategy for maximum impact. In other words, make sure your message is consistent across all your communications. The quality, coloring, style, tagline, logo, imagery, pitch, tone and sales message should be consistent in the variety of mediums you use to communicate with your audience. This includes social media, email, public relations (press kit, new release, PR events), your crowd funding site, blogs, and offline promotions (post cards, stickers, posters, events, etc.). Keeping your marketing communications consistent also applies to how you present yourself and personally interact with fans / supporters. For example, the way you answer questions or concerns; the way you engage your fans on social media, and how you thank your supporters.

With consistency comes recognition. With recognition comes familiarity. Familiarity creates credibility that leads to trust and ultimately support for your project. A good IMC strategy is crucial to creating a positive brand image. If you are crowd funding to start a business or organization, building a strong brand image is your ultimate goal. A consistent, repetitive marketing communications strategy will create maximum impact for your marketing budget and effort.

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9. Social Media Strategy / Build and grow your Fanbase.

It’s called crowd funding for a reason. You need a crowd to fund your project. If you don’t have a fanbase start building one immediately! This is very essential to having a successful crowdfunding event. If you already have a fanbase, keep on growing it. The fastest growing marketing medium for Small Businesses and organizations is Social Media. It is also the most efficient and cost-effective way to publicize a message to a large audience. Here are some basic tips for establishing and managing an online fanbase:

Setup your Social Media presence. Set up a personal Facebook page and invite friends (old & new), family, customers, business and associates to befriend you. Now set up a business fan page on Facebook and ask your Facebook friends to “Like” your business or campaign. Do the same with other social media services such as Twitter.
Market your presence. Email invites to your collection of business card contacts, Facebook addresses and personal email to everyone you know and meet. Make networking a apart of your daily routine. Send new contact a personalized email note with an invitation with links to your Facebook and crowdfunding page.
Engage your fan base. Once you’ve established a fanbase, you must keep them interested. The term engage in the world of Social Media mean to interact with your visitor and encourage them to respond back to you. There are several ways to keep your fans engaged on Facebook alone:

Fans can talk back. With a Facebook Fan Pages visitors respond to your Fan Page activates when they “Comment”, “Share” or “Like” something on your Facebook Page. It is important that you get visitors to “Like” your Page. Facebook users that “Like” your Fan Page will be able to receive your News Feed.
You can talk to fans. News Feed is a constantly updating list of stories from people and pages that a user follow on Facebook. Research show that most Facebook’s users engage with a Facebook Fan Page through their News Feed. Provide up-to-the-minute information about your campaign. For example, publicize your milestones, i.e., funds raised, ground breaking, the different phases of product production, and other accomplishments. Provide valuable information such as useful tips, product instructions, advise, coupons, discounts, contest, surveys, articles, videos, special deal, etc.
Build rapport with fans.Talk to your fans frequently: post questions for fans to respond to; follow-up and keep the conversation going, and evolving. Respond to comments and “Likes” on your page immediately. Doing so will show fans that you are sincere and appreciate them. This will create loyalty and perhaps turn a fan into a campaign supporter and brand promoter–one that will send you more customers. Be entertaining–give good humor; post videos, music, and great pictures.

Power points on engaging your fanbase:

The sole purpose of a Facebook page is to give your customers an opportunity to engage with you and your brand. (Here a brand can be a new or existing venture, organization, cause, movement, or personal pursuit). Facebook’s social sharing tools allow businesses to engage their audience in several ways. They feature several sociable tools and apps that include coupons, contests, sweepstakes, deals and more. Research suggests that Facebook users that post (newsfeeds and / or other sociable engagement tactics) at a consistent time (for example every Friday at 7:30pm) have a higher rate of fanbase engagement than users that post irregularly. Use your Facebook Insights tool to know when customers are logged in, where they are located, and other valuable demographic and useful analytical information. Also, setup a Twitter account for your business and crowdfunding campaign. Keep it fresh, active and relevant with news feeds and tweets.

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10. Good salesmanship / & the first impression.

Almost every aspect in our lives requires some degree of ‘salesmanship.’ Your success in school, career, and business depends largely on your ability to persuade others to act in a way that is favorable to you. The idea that salesmanship is a natural trait one is born with is wrong. You’ve been selling for most of your life: persuading your parents, your significant other, boss, co-workers, and your friends to act accordingly. Anyone who has the desire to change his / her financial situation and has the willingness to work hard and smart for it, can learn to sell. You will have to sell your campaign to both friends and strangers; be it in person or through the selling strength of your audiovisual and copywritten elements of your crowdfunding web site. Presented is our short list on basic ‘selling principles’ for crowdfunding.

The first impression. Make a good first impression or you’re not likely to get a second chance. This is largely related to ones appearance and demeanor. Equally important are communication skills (both oral and written) and body language. A few suggestion to help you make a great first impression, online and in person:

Always be on time. No excuse for lateness; start and end meetings on time.
Appearance counts. Be well groomed in person, in your crowdfunding web site pictures and video. Your clothes, hair, and face should always be in order.
Be pleasant, enthusiastic and courteous. Greet with a smile, and formal introduction; (give a firm handshake when in person); ask about them to show you care. Be upbeat, passionate, friendly and very excited about your campaign and your audience. Your enthusiasm will help to keep your listeners interested in your project; perhaps persuading them to support your campaign. Compliment your prospect and always thank them for their time and money.
Be Confident. Load every statement with pride. You wouldn’t buy from someone who’s indifferent about what he is selling would you? Attitude is very contagious; therefore sell with a confident, enthusiastic attitude and it will rub off on your audiences.
Communicate effectively. Effective communication skills are a must. You will only have a few minutes to communicate your vision. Use correct grammar—both written and orally. Here are a few tips: When composing your video speak fluently by making your words and thoughts flow smoothly. Try not to make your speech jerky, too slow or too fast. Make appropriate pauses at the end of sentences, concepts, and especially pause after making a point. A speaker that babbles on without pausing makes it difficult for listeners to understand the message. Properly placed pauses can add clarity to your speech and gives you a chance to breath. Pausing adds impact to your main points… making them more memorable. Properly modulate your voice: Speak in a moderate voice, varying the tone from mid to high to low when making a point. Avoid speaking in a very high tone, it sound erratic and will take attention away from your message. Correct poor speaking habits. Avoid saying the same word or phrase over and over, like saying ‘you know’, ‘you see’, ‘no problem,’ ‘yea’, ‘and-uh, you get the picture. Also, write clearly using correct grammar and everyday words.
Body Language, aka, nonverbal communication. Nonverbal communication, for example eye contact, hand movements, facial expressions and other gestures can help us get a message across, but too much can distract your audience. Gestures do three things, a) add meaning, b) take the place of words, or c) contradict what was said. When verbal and nonverbal communication disagrees, we tend to believe the nonverbal. This is why we should always be conscious of our nonverbal language especially nervous gestures. Nervous gestures such as rubbing your hair, forehead, face, chin, and tapping fingers, will divert the audience’s attention away from your sales pitch. Try to be well poised, confident and composed. Always make eye contact, and appear natural, making appropriate meaningful hand movements and other gestures when making a point. Also, we should be aware of nonverbal communication in other cultures because they may not mean the same thing.
Product Knowledge is important. You have to know your campaign inside, outside, and upside-down. Be the expert. Knowledge of your campaign is key to selling your campaign to others. As important, you must know the crowdfunding financing method.
Avoid the “I-you” Dichotomy. Avoid words that can separate you from your audience; for example, “I,” “you,” “my.” You don’t want to talk down to them, on the contrary you want to make them feel smart and important. Use words that are inclusive, and that builds a sense of community; for example, “we,” “our,” and “us.” If your audience feels like they are a part of the solution and not the problem they are more likely to consider your proposition.
Most important be honest. Integrity is very important in gaining credibility. Don’t make outrageous claims, or promises that you can’t keep. Never guess an answer. If you don’t know don’t assume, find out and get back to them.

Power points to selling your campaign.

You don’t want to come across like fast talking salesman with no personality. That will not work. Let your true personality shine. Act authentic and real. Be yourself, meaning if your funny, nerdy, or quirky, that’s fine. However, utilize these selling principals to enhance your image and campaign, not change who you are. Your supporters will greatly appreciate a little old school professionalism, which is lacking in today’s crowdfunding arena.

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11. Rewards / what you need to know.

Except for certain charities, and personal needs campaign, people do want to receive something of value for their financial contribution. Rewards are the norm for supporting a crowding campaign. Campaigns offering interesting and numerous rewards seem to garner the most numbers of contributions, when compared to similar campaigns with little or no rewards. The more unique the reward is the more popular the campaign will be.

Matching the right donation amount to a suitable reward is key to maximizing your campaign’s financial potential. This is no easy task. Rewards do two contradictory things: it entices people to donate, making for a more attractive and popular campaign, yet, the expense associated with giving certain rewards can significantly reduce your campaign funds. (The reason you are raising money). We cannot tell you what is or is not a suitable rewards to funds ratio, since every project has different needs. As a general rule, match the contribution with the reward. Don’t sell yourself short. Try to keep the fixed cost of a reward between 5 to 15 percent of donations. For example, if someone donates $25, the gift at this level should cost between $1.25 and $3.75. Once you’ve determined the cost for each reward, allocate the necessary ‘rewards funds’ in your budget. Include the costs for shipping and handling in your ‘rewards funds’ as well, if applicable.

The contributions to rewards ratio / a juggling act.

Start low, and incrementally increase. A popular and effective method is the multi-tiered approach with a wide range of funding levels, with catchy titles: For example level 1. for impulse donations, call this level ‘Friends': $5 – 20 (offer a button or bumper sticker); Level 2, this will probably be the average contributor, call them ‘GoodFellas: $25 – 75 (offer a T-Shirt); Level 3: Associates: between $100 – $300 (T-Shirt, products, invite to a special event); Level 4: Backer: $350 – $500 (special treatment and perks); Level 5: Grand Contributor: between $550 – plus (very special treatment and perks, like exclusive events, a life-time benefit, etc.). This method ensures that everyone has a chance to contribute; from the average Joe, to that high roller. These are only suggestions. You may come up with a better method based on your research, target audience and the creativity of your campaign. Please let us know what worked for you.

Power Points on Rewards:

What is a suitable gift? It depends on your campaign, budget, and audience. Your gifts should have a special meaning that’s related to your campaign. It should be something unique that your target audience would appreciate. Here are some examples of suitable gifts and perks. Early copies of the finished product; t-shirt, button, book, DVD, CD, games, exclusive event, free meal at your new restaurant per month for life; life time timeshare for your new boutique hotel, etc.
Make it special. Don’t let the rewards part be an after thought. A well implemented rewards system can make a weak, or otherwise uninteresting campaign popular. Unique rewards adds that extra sizzle, that creates the buzz. The buzz around your campaign and one-of-a-kind rewards can contribute to your campaign going ‘viral’, i.e., appealing to a mass audience, not only your fanbase. Rewards should be creative and custom, with your branding and not something you buy at a discount store.
What can they afford? When determining pledge amounts, knowing your fanbase’s budget is crucial to your success. If you’re catering to a bunch of college students, it’s going to be pretty hard to get them to pay $50 for a Limited Edition CD / Video combo. A $20 autographed Limited Edition might work great. On the flip side, if you’re a jazz artists with a huge fan base of working professionals, the $50 set might be worth your while.
Exclusivity. Consider including limited quantity, one-of-a-kind items in your rewards mix. A few autographed items, i.e., T-shirts, finished movie, book, or game. If you’re a chef, cook a gourmet dinner for your big money contributors. (Just saying.) This might motivate a fan to contribute a greater amount knowing that he will receive an exclusive reward, earning him major bragging rights.
The finished product as a reward. If you are offering backers the finished product in exchange for their support, do so at a considerable discount. They are (so to speak) pre-ordering your product or service before you produce it. Backers who get involved with campaigns for their products consider the discounted value as the key factor to contributing.
Keep your promises. The campaign creator is responsible for delivering gifts. Since the majority of contributors will be friends, family, and fans, all eyes will be on the campaign creator. Creators should and must make good on all promised gifts. If you don’t, you can be held liable.
Don’t over promise. Again, you are obligated to make good on your promises. Try not to over promise. If problems should arise, communicate immediately with your supporters. Let them know about the problem and your intended remedy, e.g., later delivery date, refund, complimentary item, etc.

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12. Budgeting / how much will you need?

Carefully set your funding goal. Add in an additional 15-25% extra for unforeseen events and expenses. However, you don’t want to set the funding goal to high. First determine your ultimate goal, e.g., opening a café, producing an album, opening that bed & breakfast house in the Caribbean. Estimate the cost. Based on that amount, create a realistic budget. For example, the estimated cost to opening a café is $200,000. Let’s itemize it:

Professional fees $5,000 (legal, license fees, accountant, consultation).
Leasehold expense $15,000 (first month, plus two months security… hopefully you negotiated 1 to 6 months free rent for the build out and startup).
Construction build out $75,000 (total contractors—carpenters, pluming, electrician).
Décor, furnishing. fixtures $20,000 (chairs, tables, lighting, pictures, gardening, etc.).
Equipment $50,000 (refrigeration, cooking equipment, exhaust hood and duct-work).
Supplies $15,000 (service ware, cookware, cleaning supplies, etc.),
Start up cash $20,000 in the bank for operating expenses.

Once you’ve determined your project’s financial need, factor in the cost of raising money: Crowd funding service, PayPal, and Credit Cards processing expenses should be considered. Determine the costs for each reward, including shipping and handling if applicable. Tally it up, and add that amount to your project for a more realistic fund raising goal. Crowd funding for the entire startup cost in the above example might not be achievable considering the funding potential of the sponsor’s social networks. In this case, perhaps crowd funding for a fraction of the start up cost, combined with another source of funding, such as a SBA (Small Business Administration) backed loan, would work best.

Also, consider breaking up your project into achievable milestones. For example, first crowd fund to produce a prototype of your invention; your second crowd funding round could be to establish mass production, marketing and sales capabilities.

Power points on budgeting:

Approach your crowd funding campaign like a business. You need to maximize your profits and minimize your expenses. In other words you want to maximize contributions and minimize expenses related to finding backers and giving rewards. Don’t spend money unnecessarily in an attempt to increase contributions. For example, on online ads, custom gifts, and SEO traffic generating schemes. Pinch your pennies and invest sweat equity instead.

No doubt you dream of taking an idea (the reason you are crowd funding) and turning it into a successful company. It takes time and lots of capital to launch a successful company. Successful startups are the ones that pinch every penny, hence the term bootstrapping. Bootstrapping is a strategy for starting a company with little or no money. It means thinking outside the box by utilizing the free resources that are readily available to you. This includes sweat equity from you and your team, a free crowd funding platform, and the many free social media marketing channels. You can implement every element of your crowd funding campaign as outlined in this guide at virtually no cost. All that is needed is investment of your time and effort.

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13. Assess your crowd’s worth / how much can you raise now?

Assess your crowd’s funding potential. What do you think your networks can realistically produce? For example, can your networks of family, friends, Facebook friends / fans, Twitter followers, email contacts and others fund a $300 project, or $1,500 project, or $5,000, or $25,000 or more project?

Estimate your crowd’s worth: Make projections using different scenarios to estimate the funding potential of your entire networks. Multiply different donation amounts by the total number of people you are sure will contribute. For example, 550 people pledging $5 equals $2,750; 550 people pledging $15 equals $8,250; 550 people pledging $25 equals $13,750; 550 people pledging $100 equals $55,000.

14. How to determine your funding goal and funding option.

Determine your target funding goal. We suggest setting a target funding goal you believe is most achieved. It will be easier for you to reach or surpass an achievable goal and go on to raise more money, than it will be to reach a lofty funding target.

Select your funding option. Most crowd funding services offer both fixed and flexible funding. Fixed is all or nothing. Meaning, if you don’t reach or exceed your funding goal, you don’t receive any funds. However, your backers won’t be charged less transaction fees. With the flexible funding option you get to keep all the funds raised less transaction fees. Some platforms only offer fixed all or nothing fund raising, FundLocalBiz offers both fixed and flexible fund raising.

You must choose the fixed funding option by setting a minimum requirement if this will allow you to complete your project and more importantly fulfill your reward obligations. Our default setting is on the flexible funding option. Just enter your funding goal.

15. How to handle objections.

Creating the perfect crowd funding site with a compelling video pitch, well written copy, fantastic rewards and informative FAQs doesn’t guarantee you the sale. The concept of crowd funding is still new. Understandably, most of your potential contributors—family, friends and strangers—may not have heard of crowd funding. The idea of contributing money to a for profit venture and getting nothing but a gift in return will be foreign, and unsettling to some folks. In certain situations you might have to first sell the concept of crowd funding. Even so, don’t expect that everyone will like the funding method, or your project for that matter.

You should expect some resistance, but be prepared to handle them properly. Always be ready to support your position with facts and practical sense. However, avoid arguing your point. By arguing you’ll only strength the prospect’s position. Rather, you should think of your position as being in cooperation with the prospect and not in conflict. Look for a connection between what he/she wants and believes and what you are advocating. Be patient, understanding and try not to push too hard.

Always acknowledge the question or objection immediately. Ignoring it only legitimizes it, since he is led to believe that you may not have a good answer. He will then focus only on that specific objection and tune out the rest of your campaign.

The best way to handle objections effectively is to anticipate them. Try to address the most common objections and concerns in the copy-written information on your crowdfunding site. Create a FAQ section on your crowdfunding site for this purpose. Keep it current by adding more questions and answers to your FAQ list to address the new concerns and objections people may have.

16. Power points to close the deal.

Do your research, create a plan, and follow through. Discover who and where your target audience is, and what they would like to hear right now. Manage your campaign as if to achieve your funding goal. This means to work your campaign before the start, from the start to the finish line. Some last minute things to consider:

Don’t rest on your laurels. Once you’ve created a crowdfunding campaign, your work has just begun. The majority of campaigns that fail, or don’t reach their funding goal, were because of inactivity. Don’t let this happen to you. You need an action orient marketing plan, with strong social media tactics. Work religiously your social media sites; start a blog and write your first post on day one and post regularly; thank your supporters publicly. Success will only come as a result of your actions.

Don’t set your goal too high. Comparable projects in the low target ranges are more likely to be funded than similar ones in the higher funding range. By following this formula, you might not only realize your funding goal but exceed it, since more people will want to fund what looks like a sure thing, rather than a risky long shot.

Keep your pitch short and to the point. People don’t have time for extra long project videos, and long description. Keep your video short, no more than five minutes. Have less than 2 pages of copy written project description. You can include additional supporting information on your FAQ page, project blog, and fine print page of your crowd funding site. Back up your campaign with lots of product pictures and graphics to show your backers what it is, and also what they will be getting for their money.

Create great content. Be a stickler about the quality of the content on your crowd funding site. Look it over carefully prior to going live. Correct poor grammar, and typos. Revise it often so that it reads perfectly. Utilize several proofreaders. Since it is difficult to receive honest critical feedback from family and friends because they might not want to hurt your feelings, seek out strangers to proofread; it could be friends or associates of your friends / family members.

Don’t be shy, be proactive. This is your shot at achieving something great. Once you’ve exhausted your personal network (friends, family,…. people that you know), you must continue to prospect for new leads. The fact is 30 to 50 percent of your funding will come from your own personal network; therefore, you will need to raise the additional 50 to 70 percent from people outside of your personal network–strangers. Yes, it is true, you will need to network and market your campaign as if you are operating a real business.

Ok that’s it! Get on the road and campaign for your campaign.

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