Small Business Saturday Blog

How To: Crowdfunding for a Small Business

Tuesday, May 26 at 13:14Crowdfunding | Finance | How To | Inspiration | Small Business

For those who aren’t familiar crowdfunding is a new option to raise money by reaching out to the ‘crowd’, i.e. everyone online. You are able to gather funding to expand your business, or to embark on a new small business venture.

2013 saw crowdfunding raise £666 million in the UK, with that figure increasing to £1.7 billion in 2014. Crowdfunding is a particularly useful tool for small businesses that have difficulty finding funding from traditional sources.

In the US, a crowdfunding success story is the Pebble Smartwatch, whose campaign raised over $20 million. Recently in the UK, Scottish company BrewDog received £5 million through crowdfunding with their Equity for Punks campaign, with the goal of financing their business with support from happy customers. Crowdfunding is a fantastic opportunity to grow your business if you set up your crowdfunding campaign in the right way.

Be a Celebrity

You already have supporters. If you’re considering growing your business there are already customers who like how-and-what you do. Reach out to these customers along with your family and friends; offer them the opportunity to become more involved in the company to their own benefit as well as yours. These supporters are your advocates. Potential investors who don’t know you personally will see that they trust and value your company enough to invest, making them more likely to do so as well.

Be a Person

A crowdfunding campaign is about working together with your supporters to expand. To do this well you need to be a person: approachable and identifiable. Simply put, people are more likely to trust and invest in a company made up of people they can identify with.

Be Professional

That’s not to say there’s no place for facts and figure. Alongside your charming self they’re a valuable tool for someone to decide whether or not to hand over their money. Particularly to those bringing larger amounts of investment that might not know you, it’s important to present your professional side and display the business acumen behind your success.

Be Open

Explain what the project is for- in detail. Tell your supporters how the funds raised will be spent on new equipment, more staff, or extra retail and operating space. Tell them how this will increase business and tell them how that will allow you to repay their investment. Crowdfunding allows for a truly symbiotic relationship. Small businesses are able to find funding under fair terms and supporters benefit from the success of the small business; local investors will also enjoy the improvements to your business.

Be Ready

Crowdfunding provides great access to potential investors and simplifies investing in your business but there’s still work involved. Before the campaign begins, things already need to be in motion. Arrange interviews or reviews that will be available before and during your campaign to attract interest. Have updates ready to be sent out when you reach your goals; thanking the investors and explaining how those funds will be used. Be sure you have social media accounts set up, where you can post these updates and interact with your supporters.

Crowdfunding  requires effort, energy and focus. But with a good pitch and some preparation you can expand your business on your terms. If you want to start up a new venture or develop your business further go to YouCan2.de to learn more.


By Sam Hemming from YouCan2.de, a crowdfunding company where you choose the best option for you with complete control over your campaign’s length, target and return on investment as well as multiple funding options to suit you.



Crowdfunding Tips for Start-Ups

Thursday, February 12 at 08:59Crowdfunding | Start-Up Support

In the last three years, the value of the crowdfunding economy has more than tripled and by the end of 2014 was estimated to be worth nearing $10 billion in funding online. There are now over 400 crowdfunding platforms, opening up a world of investment that start-ups could only have dreamt of ten years ago. However, funding doesn’t come easy. Success rates vary from 10% to 49% of all projects depending on the platform and increasing awareness and availability of crowdfunding means, inevitably, increased competition to attract supporters.

The recent, runaway success of The Wave: Bristol campaign, led the team at London-based start-up Riz Boardshorts, who are running their own crowdfunding campaign, to consider what makes a crowdfunder work and whether it’s the optimal solution for all small businesses. Here’s what they’ve found:

1.       Be prepared – it wasn’t a Girl Guide motto for nothing you know. You might think you are prepared before you start off on the crowdfunding journey but you need to consider that, on average, 2% is considered a good conversion rate of people reaching your campaign and then funding it. Simply translated, that means that if you need to raise £1,000 and estimate most people will give you a tenner, you need 5,000 people visiting your site over the life of your campaign. Ask yourself, seriously, can you reach that many people personally, through PR or through social media? If not, might it be worth trying to grow your contact base before you launch your campaign?

2.       Be flexible – you can do as much research as you like before you start but you never quite know how your campaign and rewards are going to be received. You may need to change rewards around, find new prizes and form new alliances. The most financially lucrative rewards are the intangibles, knowledge, experiences etc, which cost you very little but they might not be what your audience are interested in – the only way to find out is to try them out.



3.       Form alliances – there is strength in numbers and working with partners who will support your campaign and promote it to their supporters is invaluable. The Riz team have had fantastic support from their charity partners in the UK – the Marine Conservation Society, Eden Project and the Wave Project Cornwall - throughout the campaign and have recently launched the “Riz Ticket” an exclusive chance for anyone who purchases a reward from their campaign https://kriticalmass.com/p/bottlestoboardshorts to win a morning session at The Wave: Bristol for three people before it opens to the public. Working with others broadens your reach as well as your appeal.



Ultimately, crowdfunding remains extremely popular for start-ups because it’s low cost, easy to access and provides a good marketing platform even if funds aren’t raised. As an example, the current UK cereal phenomenon, the Cereal Killer Café, raised just 2% of their crowdfunding goal but got masses of publicity and are now happily selling bowls of the crunchy stuff in Shoreditch. With crowdfunding predicted to go mainstream in 2015, it’s definitely worth your business, like ours, taking the opportunity. Just make sure you do so with your eyes open.

By Lou at Riz Board Shorts - http://www.rizboardshorts.com/

The Riz team would love to know more about your experiences of crowdfunding and your tips for success. Contact us on info@rizboardshorts.com. For more information on the Riz campaign, please visit Riz’s kriticalmass fundraising page: https://kriticalmass.com/p/bottlestoboardshorts

About kriticalmass: Kriticalmass powers good by enabling great ideas to access funding plus vital support from brands, passionate volunteers and social ambassadors. It is the first platform that allows organisations to join the crowd and enables project creators to access the resources, expertise and reach of companies. It was launched in London in March 2014.

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