#CROWDFUNDEBRUARY — 28 crowdfunding facts
Just like vegans have Veganuary to try to encourage more people to be vegan and the smokers have Stoptober to try to quit smoking, I delveoped Crowdfundebruary a few years ago to increase awareness of what it takes to make a crowdfunding campaign successful.
Every day I post a fact on my Linkedin and Twitter account, this article is a roundup of all those facts.
1 — The money raised is only a small part of the benefits which crowdfunding brings you. Crowdfunding brings you increased brand awareness, a larger email list, a more engaged social media following, press coverage, an army of loyal ambassadors, easier access to other funding types in the future.
2 — Your crowd needs to be built BEFORE you click launch. Launch a pre campaign to build a mailing list before asking for money and use this as a test. If you struggle to get followers/find your target market and get their likes/email addresses — chances are you’ll struggle even more to get their money.
3 — Successful crowdfunding campaigns are equal parts, strategy, creative content and audience psychology. There is no luck, magic or ‘winging it’ if you want to hit your target.
4 — Crowdfunding is all about credibility! People really need to trust you to back you. Have a video to show the product. Get testimonials and PR to show social proof, we live in a belief economy now where reviews are powerful.
5 — The average Facebook timeline post has a conversion rate of 3.8%. This means less than 4% of people who see your post will go on to back your campaign. Focusing on emails is a much better success tactic
6 — Crowdfunding campaigns often follow the following path: Initial excitement, lull in the middle and rapid activity at the end. The emoji diagram below pretty much sums up how you’ll be feeling each week. My clients usually laugh at how accurate this was when I refer them back to it when their campaign has ended.
7 — Don’t ask for money immediately. You have to build trust and take potential backers down the sales funnel ahead of launching your campaign.
8 — Visitors stay on your page 35% longer once you’ve raised over 40%. Its the same as the restaurant analogy. If you’re with a friend and there are two restaurants, one completely empty and one bustling… which are you most likely to go in?
9 — Emails have an average conversion rate of 25% and those emails that are shared had 53% chance of turning into a pledge. Email marketing is the KEY to success.
10 — Crowdfunding when your audience cares is very important. There is no point crowdfunding ice cream in November you’ll work just as hard BUT raise less than if you launched your ice cream campaign in April.
11 — Campaigns that run for less than 40 days are 6% more likely to reach their financial goals. We always recommend campaigns last for 35 days.
12 — A lack of an early update reduces chances of success by about 13%. Keep your backers up to date with what you’re up to and how it’s all going.
13 — There is no magic in crowdfunding — but there is a lot of math. You can work out how big your crowd needs to be by thinking about how much you want to raise and what the cost of your product is. That should show you how many backers you will need.
14 — One study found that a typical founder with 10 Facebook friends had a 9% chance of succeeding, but one with 1,000 friends had 40% chance of success.
15 — If you’re backing a crowdfunding campaign really pay attention to the trust element. Can you trust it? Do you feel safe in the promise of getting your product? If you don’t you probably aren’t going to back it. So if someone sees your campaign and doesn’t trust it… they’re unlikely to back it.
16 — Visitors are 24% more likely to back your campaign once you hit 40% raised. Remember the restaurant analgy from day 8.
17 — Globally fewer than 22% of crowdfunding campaigns hit their target. At Crowdfund 360, 83% of our campaigns hit their target.
18 — Campaigns that offer perks raise 143% more than those which don’t. If we give money, we kinda want something in return right? Or if we aren’t getting anything, we are probably going to give less money.
19 — Being too much of a narcissist or a psychopath will be detrimental to your crowdfunding campaign. A recent study said “ if narcissism levels are too high, they can actively discourage investment, whether that be through dishonest behaviour and unreliability when trying to be too persuasive, or even rude and aggressive due to being excessively committed.”I get a LOT of emails (mostly) from privileged white males demonstrating high levels of narcissism and to be honest — crowdfunding isn’t for them. Crowdfunding levels the playing field for those traditionally kept out of business opportunities. If you think you’re THAT confident you’ll get the money — go get it, you dont need to crowdfund?!
20 — On average 42% of funds are raised in the first and last three days of a crowdfunding campaign. Meaning our emoji diagram from day 6 holds true.
21 — The average word count for a very successful crowdfunding campaign is 300 to 500 words. This doesn’t mean hold off on the information. It just means convey that information in more creative ways e.g via photos/gifs/infographics etc.
22 — 78% of successful crowdfunding campaigns exceed their funding goals. Just because you hit 100% doesn’t mean you should stop there! Our best crowdfunding campaign raised 1072% of their goal!
23 — The US (42%), the UK (11%), and Canada (5%) are the leaders in the global crowdfunding market share.
24 — A new fundraiser is started on GoFundMe every eight seconds. — and what do I say? Never Use Go Fund Me!
25 — Your first crowdfunding campaign will always be the hardest. Every campaign after that will be easier and you can raise more. It’s the same with anything right? The first pineapple upside down cake you make will be the hardest. By the 10th time you might be quite good at it.
26 — A successful crowdfunding campaign has an average of 316 backers, while the global average is only 92. At Crowdfund 360 our campaigns have an average of 234 backers.
27–12% of Facebook shares convert to donations and 3% of Twitter shares convert to donations. Again remember Email is key to success as stressed on day 9.
28 — Campaign teams with more than 4 people, raise almost double that of campaigns with only one person. Find out what skills each of those 4 people need by watching our Youtube video series on how to make a kickass crowdfunding team.
If these facts were useful to you we would LOVE to know. Please email your favoruite one to info@crowdfund-360.com.