If you are reading this, you need money to fund your entrepreneurial idea and we do have some suggestions that might help you. As most entrepreneurs already known how to go about it, this post will focus on fundraising from a different perspective. It will be less about presenting the same set of ideas that we all know about, and more about the focal points behind those ideas which can make each event more meaningful.
Private Investors: Family and Friends?
If you believe that rich uncle of yours probably won’t ever invest in a new idea, or your friends may start to avoid you subtly on being asked to invest, then we urge you to consider what that thought process implies. If you cannot convince the people closest to you to make small investments in your vision, how will you convince complete strangers to do so? Not everyone close to you can or will invest in your project, but you should at least try to get them involved, provided that you have faith in the idea yourself of course.
Crowdfunding: Kindred Spirits Vs. Strangers
Any business idea of decent scale requires heavy investments and, in most cases, money from friends and family will probably not be enough to cut it. This is where the strangers come in, and rest assured the internet can indeed surprise you. What makes honest and well-planned crowdfunding projects different from the age-old practice of trying to find private investors for launching a company is a critical one.
In most instances, business investors invest in ideas and plans because they believe the business will generate profits for them down the line in one way or the other. A crowdfund project, on the other hand, is funded by people who share the same vision, concept or wish as the ones in charge of the entrepreneurial project. Profit is usually not what makesan online crowd fundraiser successful; it’s almost always mutual interest. They wish to see the end product come to life almost as much as you and that’s exactly what bonds the crowd and the company together.
This is precisely why products such as the Pebble Time (smartwatch), Exploding Kittens (card game), Tainted Grail (tabletop board game),KeyChron K2 (mechanical keyboard), Divinity Original Sin 2 (RPG video game), etc. managed to receive funds several times over their initial expectations.
Crowdfunding: Building Your Own Platform?
Every business that manages to generate funds with kick starter projects must pay a portion of those funds to the platform itself. What if you did not want to pay a percentage of your potential investments to the platform? What if you launched your own digital platform to generate money for the business idea, as well as that of others? Well, the answer is that this would theoretically put you at a serious advantage.
- Any funds that the project generates from people who share your dream will be yours to keep after taxes.
- Instead of paying a third-party platform, you will be generating funds every time someone uses your own platform to crowdfund their business idea.
- You will still be able to list your project on all the established websites for garnering more attention if you so choose.
Therefore, the concept of creating and running one’s own digital crowdfunding platform is not just an effective way to generate funds from mutually interested individuals, but it is a viable business idea with huge potentials in itself. To get started, you will need to learn about how to start a crowdfunding platform of course.
Brush Up on Your Persuasion Skills
How could anyone ever be successful in generating funds from potential investors at an offline fundraiser event, if they lack the power of persuasion? If you don’t yet have the knowledge and experience to know how persuasion is used as an essential soft skill in business, join a crash course and brush up on the following:
Communication – Communicating exactly what you want to convey, in a manner which would be most effective for the particular audience in question.
Active Listening -Listening intently and respectfully to what the other person is saying, without interrupting them.
Emotional Intelligence: Taking note of and then adjusting accordingly with your audience’s emotional disposition, during any form of communication. You will need this skill extensively to implement the next one successfully.
Responsive Reasoning& Negotiation – Mathematicians are excellent at making real life logical deductions, but they are seldom known for their power of persuasion! Human beings are both logical and emotional beings, so when you are trying to persuade someone to invest in your business, never reason with them to the point where it becomes an argument.
If you manage to channel your emotional understanding of the person in your responsive reasoning and negotiation efforts, you will find that people are easier to persuade. Do not be discouraged by past failures but try to build on them instead. Learn from your mistakes, try old ideas with new augmentations and invest yourself in new ideas which you may not have explored yet.
It’s true that new businesses fail every year, but what people do not mention is that the entrepreneurial ventures that have made it, didn’t get there on their very first attempt. It’s all about how hard you are willing to try, and for how long you are willing to persevere.