Entrepreneurs are special because coming up with great ideas is second nature to them, and a great idea is the crucial first step in creating a great business venture. However, social entrepreneurship isn’t without its hardships, and one of the more persistent challenges that many entrepreneurs face is finding funding for their venture.
On August 2nd, SEG hosted a lunch panel on Crowdfunding. Panel members included Christine Landon of WebFinancial, Micah Baclig of Kuma, Matt Cavallaro of Nest Homeware, and Andrew Spacone of Adler, Pollock & Sheehan. If you couldn’t make it to the panel, this post includes some tips from the panelists that we took note of. However, if you want the whole scoop, make sure you check out our events calendar and register for the next panel discussion.
Crowdfunding Best Practices:
- Crowdfunding involves funding a venture through financial contributions from a large number of investors, and sometimes, managing such a complex financial scheme can be difficult. Thankfully, there are many different platforms, that cater to the needs of different ventures, that incorporate the financial management aspect of crowdfunding into your venture’s business plan so that you never have to deal with the complicated details alone.
- Creating a crowdfunding campaign doesn’t necessarily guarantee that you will attract many investors. In order to market your venture to potential investors, make sure you first develop a strong business case.
- There are many ways to attract investors to your crowdfunding campaign, but perhaps the most effective is having live events. Hold an in-person event so that you can expand your reach for prospective funders, thank your supporters and celebrate!
- It’s easy to rush through planning your business and crowdfunding campaign in order to get straight to the launch. Alwaystake your time in the planning stage. Before you launch your crowdfunding campaign, make sure you take the time to define your brand, do enough market research, determine your sales strategy and reach out to the right people for mentorship and support.
- Sometimes, even if you give yourself plenty of time to plan things out, not everything will go according to plan. In those instances, be communicative with the investors in your crowdfunding campaign. Keep them in the loop about any delays to the launch of your product –investors like to know that progress is being made with their investment even if timelines change!
- Keep in mind that for all its advantages and popularity, crowdfunding can be difficult and is only one of many funding options and it might not be the best one for your venture. Other traditional or non-traditional funding options such as taking out a loan or reaching an agreement with a single large investor may require less responsibility to fewer people, less time commitment, have lower interest rates on returning investment and provide more freedom. Before you commit to crowdfunding, research all funding options to determine what the best fit for your expertise, needs and resources is.
Talent Management & Journalism Intern
Naz Akyol is a senior at Brown University studying International Relations. She is interning under the University Initiative Talent Management program under Brian Sweeney and contributing to the SEG Blog. Originally from Ankara, Turkey, she works as an editor at Brown Political Review on campus. She is interested in learning more about local socially-conscious venture development.