Create a Business Crowd-Funding Project
Objectives
· Learn strategy behind business crowd-funding proposals and how to appeal to potential funders
· Practice creating basic elements of a business crowd-funding proposal
· Become familiar with business-oriented crowd-funding websites
· Have a potential portfolio piece related to business models
Introduction
In the Emerging Business Models section of the EBM course we discussed crowd-funding and its potential as a means of launching new projects or finishing funds for business ventures. This exercise will provide experience in developing a potential business project and strategy to make it appeal to potential donors. First, review the slides attached regarding Crowd-funding. Then go on a site such as Kickstarter, check out some projects, and note the layout and items required.
Note: This is to be a business-based proposal for finishing funds for a business project. It is NOT a go-fund-me type proposal simply to get support for an individual in need or a cause. Please check with the instructor in advance about the type of project you will be proposing. It is a business project proposal, not for a personal need.
Instructions/deliverables:
The crowd-funding proposal should be as realistic and focused as possible, something that is actually possible in a real-world business situation with real world budget. The project should be defined with specifics that make this product/service different from other similar ones.
For example, a "fashion website" is too general. A "You Tube program featuring urban street fashion tips for young men teens to 24" is more focused.
Format: This is a narrative document with fully-developed paragraphs in double or 1 ½ spacing. It should cover the following items with a subhead for each item.
1. Website:
Identify the crowdfunding site you wish to use and why. Sites have various rules or types of projects they will accept.
2. Title:
Give the project a title that will appeal to potential funders.
3. Customers:
Define the target audience or customers for the project. Be as focused as possible by age, gender and/or interests of those who would actually use or donate to the project. For example, ‘music lovers 7 to 70' is not a target. ‘Young men teens to 24 who like urban hip-hop music' is.
4. Funds Requested.
Set the amount of funds you are requesting based on an overall budget for the project. It can be part or all of a budget, or finishing funds for a project that is already started.
If it is part of a larger budget or finishing funds, define specifically what it is for and what part of the overall budget it is. Note the guidelines on the site you chose for how much can be requested. Research what it really costs to do what you wish to do.
5. Strategy:
Define the project as specifically as possible. Think about what make is unique and why it would appeal to the target customers. Why should strangers support it -- what strategy would make them want to support it? Be focused. (Length: 200 - 250 words)
6. Create the ‘story':
This is the most important part of the proposal, the description that appears on the website and provides the rationale for the project and why it deserves support.
The story can be straight-forward, or fun and funky, but it is the heart of the proposal. (check out other proposals to see what the ‘story' looked like). (Length: what is necessary to tell your story?)
7. Develop ‘rewards' for potential investors.
List rewards and amounts for each. Note: Rewards can make donations more attractive, but are often optional. It is best to create ‘digital' rewards such as a digital file of a recording or digital poster.
Be realistic. If giving something like T-shirts or merchandise, you have to manufacture it, track orders, warehouse it and ship it.
Can the funding support that type of additional expense and effort? Free samples from the project also add up. Make sure the dollar amount is worth the effort to create/ distribute the reward, and doesn't distract from the project itself.