Three early lessons from my first experiment with crowdfunding

I’m a week into an experiment with crowdfunding and to say it’s been a steep learning curve is an understatement. From what I had seen while skimming campaign pages on several crowdfunding platforms, the project I hoped to promote – installation of solar panels at the Theological College of Zimbabwe (TCZ) — seemed tailor-made for this fundraising method.

The project is specific, on a short timeline, and reasonably priced.  The impact of the solar panel installation will be felt immediately by students enrolled at the Zimbabwean college today and bless students for years to come. In other words, although a once and done initiative, ROI to donors is ongoing. And the installation will be completed by an enthusiastic team of Messiah College engineering students, saving tons of cash in the process — which should also appeal to donors.

I was sold, and so I jumped into the fray, setting up a project page on RocketHub.

Flip the Switch

ABOUT CROWDFUNDING

Before continuing with my story, it seems a good idea to define crowdfunding for readers unfamiliar with the concept. In a nutshell, crowdfunding is, as its name suggests, a funding method where common people like you and me (the crowd), fund other people’s good ideas, typically via the Internet. A fast-growing cottage industry of crowdfunding platforms has sprung up in recent years, providing myriad variations on the theme.

However, there are commonalities. As an article from the Forbes blog explains

While each site offers their unique spin, the general concept is the same across the board. Project creators can create a profile typically containing a short video, an introduction to their project, a list of rewards per donation, and some images to elaborate. The idea is to create a compelling message that readers will be drawn towards.

And there is the kicker — drawing people toward your site. I’m learning as I go, including the following

THREE HARD LESSONS TO DATE.

First, crowdfunding isn’t an easy path to big bucks. Like a lot of newbies, I fell for the “if you build it, they will come” fallacy. As it turns out, choosing a platform and creating a project page are the easy parts. Attracting potential donors to the project is a lot harder and a lot more work.

Had I known a week ago what I know now, I wouldn’t have launched the project page without 20 percent or more of the fundraising goal already committed and ready to post. RocketHub refers to this as “seeding” the fund.

Second, internet-based fundraising is visual. Words are important, but its quality pictures and video that carry the day – with the emphasis on quality. In crowdfunding, a bad picture or poorly produced video isn’t better than nothing.

Had I known a week ago what I know now, I would have monitored production of the project video rather than leaving it to volunteers with good hearts but absolutely no understanding of what a quality promo piece looks like. I also would have stock-piled good photos and avoided chasing after pictures now that the site is up and running.

Third, crowdfunding is all about your network. Typically, most successful projects receive between 25-40% of the total funds raised from their first, second and third degree of connections. In other words, if you’re starting with a tiny circle of friends, you’ll likely raise a tiny bit of money.

Three degrees of separation between your inner group and possible donors to the project? Maybe. Six degree? Not likely without a lot of work and even more luck.

Had I known a week ago what I know now, I would have set the project goal at $5,000 and not $10,000. I am worried that The Friends of TCZ, the group behind this project, don’t have the reach or the social media savvy to go much beyond our usual fundraising suspects. But it’s early in the campaign and the tide could shift in the project’s direction.

I’ll come back to the TCZ Solar Panel Project in a few weeks, with more lessons learned from my first foray into crowdfunding. In the meantime, I will be a grateful blogger if you’ll give the TCZ project page a look, even better, make a gift. And if you’re on Facebook, please “like” the Solar Panel Project page.

Generous matters, including with our social media networks.

If you’ve had experience with crowdfunding (good or bad), please share with Generous Matters readers what you’ve learned. 

Comments

  1. I appreciate the experiment you’ve attempted. I know little about this but have wondered if we are missing out. I’ll stay tuned.

    • Obviously, I also know very little about crowdfunding, but I’m blundering along. My only consolation is that Generous Matters readers can learn from my mistakes and not repeat what I’ve done wrong. Thank you for staying tuned. I will report back when the RocketHub campaign ends.

  2. Thanks for your summary. We experience the same lessons and even lesser results:
    http://www.rockethub.com/projects/25229-goshen-college-algaetown.

    • Interesting, Rose, that your experience with crowdfunding is similar to mine. I’m not ready yet to give up hope of reaching the goal, but it’s looking less likely everyday. At the least, I’ll get another blog article out of the campaign.

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