Challenges for Crowdfunding
- The idea of crowdfunding is not new in India. Places of worship, for example, are built overnight using a large number of donations. However, the concept of online crowdfunding is new to the country.
- The industry is also not very investor-friendly. It seems people are still not ready for this concept.
- Low trust levels of doing the things online is also a challenge. India’s ecommerce space needs to really mature before anything substantial can happen in this space. People need to be spending more and more online for them to even start thinking about backing online projects online.
- As long as the crowdfunding platforms are not making any financial promises to the contributors, they should be theoretically safe to operate. However, to build a credible case for the industry to grow in India, it would do help if these platforms proactively approach the regulators and work with them to processes so as to build long-term credibility and transparency.
- Ecommerce in India only got a boost when they initiated the concept of cash on delivery. Similarly, crowdfunding will have to look at building an offline base to finally induce mass awareness and encouraging larger participation.
Tips for crowdfunding Campaign
Understand the pros and cons.
Crowdfunding has many pros for nonprofits: increased donor base, raised awareness, quick turnaround. Cons include strain on already limited resources, a requirement of a certain level of staff tech-savvy and a bigtime commitment.
Create your plan.
Like any successful event or fundraiser, you need to invest time, weeks, or even months and resources into planning for the crowdfunding campaign. Planning includes setting a goal, a deadline, and responsibilities for each step of the timeline.
Set your goal and deadline.
Crowdfunding campaigns are NOT your annual appeal and they are not to be used for “general operating” funds. The goal needs to be specific ($5,000 for a new playground) and have a deadline attached (we need to raise this in 3 months to build the playground before the spring).
Craft the pitch.
The pitch should answer the questions – WHY now, and WHY you? You need to demonstrate the urgency and the impact a gift will have. The pitch is where you need to spend the most time. It needs to be concrete, clear and concise.
This is absolutely vital. Tell your story through visuals, which are more likely to resonate and be shared on social media platforms.
Choose your platform.
Only after you have created a plan, set a goal and a deadline and crafted your pitch should you choose a crowdfunding platform. Indiegogo is one of the most popular with nonprofits, due to the fact that they can keep the money raised, even if the total goal is not met.
Set everything up.
Make sure it looks visually appealing with your nonprofit branding and contact information front and center. Upload the video and photos. You have one chance to grab people especially those who will be coming to your campaign and not know much about you. First impressions are everything.