serving community through crowdfunding (bill huston)
DESCRIPTION
BDPA Cincinnati chapter explored Crowdfunding at its October 2014 program meeting. Crowdfunding is one of the fastest growing ways for entrepreneurs to raise money to kick-start businesses and projects. One of the most pressing questions for any new business is how it will be funded! Crowdfunding is the use of small amounts of capital from a large number of individuals to finance a new business venture. Crowdfunding makes use of the easy accessibility of vast networks of friends, family and colleagues through social media websites like Facebook, Twitter, Google+, and LinkedIn to get the word out about a new business and attract investors. We looked at one of the most attractive options – Crowdfunding - and learned the ins-and-outs from a local expert. Our guest speaker on this topic was Bill Huston, co-founder of My Crowd Rocks, a crowdfunding and social media consultancy. As the Chief Marketing Officer and Digital Strategist, Bill heads the lead generation and branding strategy including blogging, search engine optimization, video marketing, and social media. Bill has over 15 years’ experience in leadership, marketing, and strategic planning, and the team he has assembled has over 20 years of experience and a demonstrated desire to improve the global business community through crowdfunding and digital communication.TRANSCRIPT
Crowdfunding For Tech Startups
Crowdfunding as a Pathway to Marketing and Funding Your Tech Startup
1. The Statute of Liberty was the first American Crowdfunding Project
2. Joseph Pulitzer appealed to the American people using his Newspaper “The World”
3. Raised over $100K in 5 months with over 120K donations of less than a dollar
The History of Crowdfunding
Crowdsourcing-The practice of obtaining needed services, ideas, or content by soliciting contributions from a large group of people.
Social media is an essential component of crowdsourcing that allows organizations to reach a wider audience faster, cheaper and more efficiently than ever before.
Crowd Sourcing & Social Media
Crowdfunding is an internet-driven means of raising money from the mass market by receiving small amounts of money from a large group of people, to fund a project or business
Crowdfunding was a response to the “Great Recession”
What is Crowdfunding?
• Crowd Funding was initially seen by many as a concept unsuitable for use in the business world.
• Despite this skepticism, the tightening of banks’ lending criteria and unavailability of commercial finance has transformed crowdfunding into $5 Billion global industry
The Genesis of Crowdfunding
The 5 Types of crowdfunding
1. Crowdfunding has spread around the globe and reaches over 160 countries worldwide and more than 90% of the world's online population.
2. Global crowdfunding produces 500 new projects per day, and between 18,000 & 22,000 projects are open at any one time
3. A new crowdfunding project is created every three minutes globally
The Global Crowdfunding Economy
City Cincy Indy Lou Col
NEW PROJECTS EACH DAY 1 1 <1 1
PROJECTS CREATED IN Q2 92 101 30 101
ENDED FULLY FUNDED 33% 17% 26% 21%
PEOPLE BACKED EACH OF THESE
59 76 32 152
WAS THE AVERAGE AMOUNT RAISED
$11, 668 $64,553 $3,293 $21,577
THE TOTAL RAISED IN THE PERIOD
$366,673 $1,010,505
$21,362 $561,362
Crowdfunding in the Cincinnati Region
SUCCESSFUL PROJECTS
AVERAGE BACKERS TOTAL FUNDS RAISED
5,729 KICKSTARTER 251 KICKSTARTER $125M KICKSTARTER
2,649 INDIEGOGO 152 INDIEGOGO $49M INDIEGOGO
572 FUNDRAZR 136 CROWDCUBE $12M CROWDCUBE
91 CROWDFUNDER UK
101 ROCKETHUB $1M FUNDRAZR / ROCKETHUB
60 ROCKETHUB 67 CROWDFUNDER UK
$763K CROWDFUNDER UK
The Top 5 Crowdfunding Platforms
1. Pirate3D Inc set out to bring affordable 3D Printing to the home and raised $1.4M of its $100K goal on Kickstarter
2. Kreyos raised $1.5 million from a $100,000 goal.
3. Tile a location tracking device has garnered $2.6 million to date and almost 50,000 backers
4. The Ubuntu Edge raised $12 million, but failed to meet is lofty goal of $32 million
Tech Startups Using Crowdfunding
1. Market Research2. Market Validation3. Proof of Concept4. Build an engaged community of customers5. Build brand advocates that spread the word
about your brand6. Product development feedback7. Testimonials and case studies8. Pre- Orders for your product and service
The Benefits of Crowdfunding
1. Clearly define your product and your goals2. Tell a compelling story about what you can
do for others3. Create a powerful video it is crucial4. Brand development is a key component5. Produce powerful & persuasive
copywriting6. Implement targeted social media
management & Pr campaigns
Campaign Best Practices
1. Too little time devoted to planning and promotion
2. Project owner did not successfully engage their personal network
3. Project owner did not build press relationships
4. Campaign funding threshold set too high
5. No video or poor video included
Top 5 Reasons Campaigns Fail
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The Future of Crowdfunding•Crowdfunding is estimated to be a $300 Billion global industry by 2025
•Crowdfunding will become a global alternative for SMB and Startup finance
•73% of Tech Startups that successfully crowdfund for $50K or more go on to receive later round funding
•Crowdfunding is a great route for alternative financing for Black Tech Startups if we can grow and mobilize the needed social capital