Crowdfunding as a concept by which individuals seek funds for their businesses from a large number of people was introduced a few years ago and before long it became a successful instrument for fund raising.
However, the amount of funds collected in India is much low compared to that in the US and Europe. Crowdfunding is at a nascent stage in India and we actually need a customised version of platforms like Kickstarter, Indiegogo that will help start-ups and individuals launch a product and test its market viability.
Crowdfunding is definitely about raising funds in the most democratic way. However, it has a host of other important aspects. It’s relevance and importance in other aspects are often ignored, thus limiting its scope of contribution in business ventures.
Ajay Mittal, Founder of MeraWorkshop, an online discovery and booking platform dedicated to workshops, and member of the Global Shaper Community of the World Economic Forum, delves deep into the domain of crowdfunding in an interview with the Entrepreneur India.
Support Based On Trust
“When someone contributes or backs your campaign you must consider it as a vote in favour of your project. They put in money because they believe in your vision and the potential of your idea or a solution that you have developed. You must be thankful for all such contributions to the campaign. You must speak to them to understand what is that one thing that excites them about your project,” suggested Mittal.
“Tribe Building through strong follow-up with voters/contributors is the most important aspect for crowdfunding. For me this is important beyond funds because the funds that come in are one-time contributions. With right strategies, you can build a community that can help you achieve more, beyond the project. You may find outside investments or regular donors for your project or cause,” he advocated.
Mittal advised to engage in discussions with supporters to understand their reasons for backing the project, to show gratitude and to connect with them and align their reason to the mission.
“With crowdfunding, you are creating awareness about a project or cause. You will reach out to a lot of people, if you are effectively conducting your campaigns. Often crowdfunding platforms feature projects in their newsletters. Interesting campaigns can attract media attention and create buzz on the social media.
While funds are more tangible measures for the success of the campaign, networking also holds possibility for potential partnerships,” he opined.
“Managing crowdfunding campaigns is a great learning experience. Your perspective about a lot of things might change and the entire process of building and running a campaign, communicating with potential backers and people who contribute to your project will add a lot of valuable inputs and save you from failing in your journey,” added Mittal.
Great Market Validation
“Lastly a successful crowdfunding project can be summarised as great market validation for your project. You may get a critical feedback from early adopters or believers. This in addition to investments, influences and tons of confidence that you will acquire with crowdfunding,” signed off Mittal.