BENEFITS OF CROWDFUNDING – Pros and Cons of crowdfunding

Benefits of crowdfunding
Benefits of crowdfunding

BENEFITS OF CROWDFUNDING

Benefits of Crowdfunding If you are considering raising funds for your project or business through
crowdfunding, there are a number of factors that you might want to consider for
instance the benefits and disadvantages of crowdfunding as discussed below;

Advantages (Benefits of Crowdfunding):

  1. It can be a fast way to raise funds
    When you are a starting company focused on building your company and
    attracting capital, setting up a successful crowdfunding campaign is far more
    effective and efficient in getting your message out to the right people compared
    to applying for a loan or seeking out potential investors yourself.
  2. It can be a valuable form of marketing and result in media attention
    It  is a great way to bring in backers outside of your personal
    network as its open to the public.
  3. Your investors can often become your most loyal customers through the
    financing process

    The people that power your idea’s social proof are your early adopters and
    potential investors. They are the people who believe in your story, product, or
    service enough to stake their money on its long-term success. These early
    adopters are key to the success of your crowdfunding campaign and the
    momentum you keep after closing.
  4. Sharing your idea, you can often get feedback and expert guidance on how to
    improve it

    One of the greatest things about crowdfunding is how close it gets you to
    customers giving you a chance to engage and field questions, complaints,
    feedback and ideas. You never know your company’s next great idea could come from somebody you don’t know. Thus, it’s important to seize any opportunity for
    customer feedback and consider it in planning.
  5. It gives proof of concept
    The first question that any investor will ask will often be in the lines of proof of
    concept and a good way to gain some respect and credibility is be able to show
    that your project had a successful crowdfunding campaign.
  6. It’s easier than traditional applications
    Applying for a loan or pursuing other capital investments are two most painful
    processes that every entrepreneur has to go through especially at the early stages
    of the company.

Thankfully, the application process for crowdfunding is a walk
over. In order to get started, all you need to do is set up your project, create a link
for the project, and make a video related to your idea then contact Easypay for
approval and your project will be set live to start receiving funds.

Ref:
Crowdfunding – What is crowdfunding and how does it work in Uganda
Setup crowdfunding cause – Start receiving donations

Disadvantages:

  1. If you don’t protect your idea well during the crowdfunding process, some
    people may steal it.
  2. Failed projects risk damage to the reputation of your business and people who
    have pledged money to you

How to run a successful crowdfunding campaign

If you are looking to get attention and funding for your business idea, Easypay
crowdfunding might give you the initial push you need to make your dreams a
reality. The following are factors to running a successful crowdfunding campaign;

  1. Share your story.
    Let your potential funders know how your product or business idea can benefit
    them. Share who you are, what you are planning to do, what your budget is and
    why they should back you. This shows that you have actually put some thought
    into the idea which helps prove credibility of your project.
  2. Set a funding goal
    At this point, it’s important to think about how much money you need to get your
    business up and running, and how many people you know might be willing to
    pledge. Although you may attract the attention of new people with your
    campaign, most of your support is going to come from those who already know
    you. Be realistic. Also keep in mind that you can’t change your funding goal once
    you’ve initiated the campaign.
  3. Promote your project campaign
    There are many different ways to make people aware of your crowdfunding
    campaign for instance create a link for your project and share it to your family,
    friends and the entire public through social media platforms like Facebook,
    twitter, Whatsapp etc… This will help create awareness for your campaign
    hence attracting potential funders.
  4. Keep your campaign short
    You may choose to make your project campaign long but statics show giving
    people more time does not necessarily make them give more results. Shorter
    projects get more success as they show confidence and add an element of
    urgency.
  5. Use your existing network
    Inform your friends, family, colleagues, business partners and anyone else you
    know about your crowdfunding campaign and use them to tell your story and
    why they should back you.
  6. Update your funders as the project progresses
    You need to keep your project funders in the line as you move forward with your
    campaign. If you don’t share regular updates with them, you could lose their
    interest and might not be able to attract as many pledgers as you’d like. Be
    honest and regular with your updates. If things aren’t going exactly as you hoped
    they would, be transparent and tell them that.
  7. Make changes based on the feedback
    Getting feedback from your people is essential to making any necessary
    improvements before starting a campaign. You must take consumer and feedback
    seriously. You may have an amazing idea, but that doesn’t mean it can’t be even
    better with a little extra work.

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