Crowdfunding projects fail all the time. On average, there is a 50% chance your project will not achieve its funding goal.
According to Krowdster, success rates range between 9% (Indiegogo) and 57% (Pozible).
So there’s a really good chance that the first time you run a crowdfunding project, it’s going to fail.
But people who work with me have an 88% chance of success.
Yes, seriously. I get results because I understand the things people don’t do when they run a crowdfunding project. And let me assure you, it’s always things you haven’t done that mean your project will fail.
No project has ever failed because it did too much.
But there are some really common mistakes, so today I’m looking at the top 10 reasons your Kickstarter, Indiegogo, Pozible, PledgeMe or any other crowdfunding project will fail.
1. You didn’t ask for the money
I know. It’s so dumb it’s silly, but practically every failed project, fails to ask for the funds.
You should ask for the money in your video. Right at the end. Give people a call to action and say “make a pledge and back this project now!”
I see the first cut of a lot of crowdfunding videos. Around 95% of creators fail to include this piece in their video the first time around. It’s the advice I give most often for improving a campaign.
2. You’re asking for too much money
The first thing I do when I work with any creator is to address the budget.
It stands to reason that the less money you are asking for, the more likely you are to succeed.
There’s an art to coming up with the right funding goal. You need to ask for enough that you can complete the project and deliver the rewards, without shooting yourself in the foot by asking for too much.
The easiest way to balance this is to consider the aims of your project. Are you aiming to do too much? Could you break it up and use stretch goals if there is demand?
3. You’re running a flexible funding campaign
Take a look at that graph at the top of the page again. Are you surprised at Indiegogo’s success rate?
You shouldn’t be. It comes down to flexible funding.
Flexible funding should be used for causes, not projects. A cause is where you are looking for traditional charity-like donations (potentially in return for a reward), and anything is good.
A project generally requires a specific total in order to complete the project.
For most creators, getting anything sounds better than getting nothing. But the truth is, the psychology of flexible funding means backers are less likely to jump on board, and you don’t try as hard to get them.
If you’re unconvinced, I’ve written an entire post that goes into more detail on why you should choose fixed funding.
4. You don’t have a video
Your video is probably the most integral part of your project.
Having a video increases your chances of success more than any other tip you’ll find on this page.
A video is a passive form of communication. It’s more work for you, but it’s less work for your viewer.
They can just press play and find out what the project is about. They are more likely to watch a video than read your description – but only if you have one.
Want to create an an awesome crowdfunding video? Check out all the articles in the ‘Your Video’ category
5. No one wants your rewards
While not every backer will choose a reward, many will. Especially if you’re trying to produce a product.
In essence, there are two major types of campaigns: “pretail campaigns” and “other”.
Pretail campaigns are projects that are fundraising to produce a product. In these campaigns, you will probably spend most of your copy and video time telling people why your product is awesome.
If you’ve done this, then you better be actually selling your product.
Other campaigns are the ones that typically rely on merchandise rewards and things like social media thank yous.
You can get more creative than that. Be original, take a risk, and come up with something really good.
6. Your rewards are confusing
Some crowdfunding experts will tell you that rewards should be like a buffet – with lots of options to choose from.
The numbers tell a different story. Aim for between 7 and 10 reward levels.
Keep your reward structure simple, and avoid rewards which will cost a lot of additional funds or time to fulfill.
Want more tips about creating awesome rewards? Check out these 7 essential tips for setting crowdfunding rewards.
7. You don’t tell people about your project
If you’re dedicated to success, then I’m sorry: you’re going to have to tell people about what you’re doing.
Success doesn’t happen in a vacuum, and backers don’t come out of nowhere.
You’re going to have to tell your friends, and your family. You’re going to have to shout it from the rooftops. You need to get in touch with journalists and tell the lady at the supermarket checkout.
Send emails, send press releases. Have a dedicated strategy.
You’ll have to hold parties and travel and make sure that anyone who will be interested in backing you knows about your project.
That’s what successful creators do.
8. You rely solely on Facebook
Facebook is great for seeing hundreds of photos of your best friend’s new baby, or to organise a family event, but it is awful for promoting your crowdfunding project.
This is primarily due to the Facebook algorithm which penalises promotional posts and repetitive content. Posting the same link on Facebook over and over again means it works less and less.
9. People don’t trust you
I can’t tell you how important trust is when it comes to crowdfunding.
You are asking people to give you money – often a lot of money – in return for something that doesn’t exist yet.
This is why you need to be in your crowdfunding video, and why your copy needs to speak with authority.
It’s also why you need to be confident in your promotion, and available to your backers to answer questions and emails.
Trust is utterly key to a successful project, and it’s not just about how you sound: it’s about how many other people ‘trust’ you.
The most efficient way to build trust is to launch with a bang. Launch with a surge of support, and that will speak volumes to other backers. To achieve this, warm your backers up before your campaign goes live so they’re ready to back you as soon as possible.
10. You don’t stay in touch with your crowd
Every crowdfunding platform includes a way to communicate with your crowd.
Updates throughout your campaign (and beyond) help to build your crowd. They encourage your backers to share your project with their friends, and give them a true sense of belonging. They help develop what I call Forever Fans.
Aim to send 3-4 updates per week while your campaign is running.
Once your campaign is closed, aim for at least once a month until all your promises have been delivered.
Stay in touch with your crowd and form a sense of genuine connection. This will not only help you with the current project, but every project you run in the future.
How Multitude helps you succeed
Planning a successful crowdfunding project takes time and energy. It also takes knowledge about what makes a campaign succeed in the first place.
And that’s where Multitude can help.
From personalised one-on-one coaching, to one-off advice sessions, and our comprehensive step-by-step crowdfunding program, there is an option that is right for you and your project.
