If you want to take your side project to the next level, you’ll likely need a little help from your friends, and perhaps a whole lot of strangers. Crowdfunding sites, like Indiegogo and Kickstarter, encourage people to contribute money to help inventors realize their ideas, whether it be for completing a humanoid science tutor or a game console for pets.
“One of the hardest things to get people to do is open their wallets,” says Alon Hillel-Tuch. He helped create one of the first crowdfunding sites, RocketHub, in 2009. He has given talks on TEDx and was interviewed by Make: magazine on how tinkerers can use such sites to raise funds. When people do back a project, he adds, it’s because they believe in the idea, want to be part of a community that supports the innovation, and would like to own the final product.
But with tens of thousands of projects on crowdfunding sites to choose from, how can yours stand out from the pack? Hillel-Tuch, who sold RocketHub in 2015 for US $15 million, offers six tips on how IEEE members can launch a successful crowdfunding campaign.
Tell Your Story
The first thing you must do to set up your crowdfunding campaign is to explain what your project is about. But don’t just lay out the facts, as many engineers will do, Hillel-Tuch says. Potential funders have many projects to choose from, so you must ensure that yours stands out.
“Get to the core of why you’re pursuing the endeavor,” he says, whether in your written description or a video you produce. “You have to pull on their emotional strings in a sincere and authentic way.” Tell them why you’re excited about your project and why you want to share it with them.
IEEE members have a leg up in terms of getting strangers to trust them, he says. He is familiar with the organization because his father, Bruce Tuch, helped develop the IEEE 802.11 standard. IEEE members have the experience to see their projects through, Hillel-Tuch says—which might encourage people to fund one of their endeavors over a similar one being developed by, say, a hobbyist.
Set a Funding Goal
People contribute, on average, US $75. If you want to raise $150,000, the math is simple: You’ll need 2,000 people to back your idea. If you have that kind of network, or the ability to grow that large a community, that’s fantastic. But if you do not, break apart your project, Hillel-Tuch advises. If, for example, you need $40,000 to build your prototype, set that as a milestone. Once you reach that goal, it further encourages people to back your project.
Many crowdfunding sites release funds only when the goal has been reached—which is why it’s important to be practical and not overly ambitious. You could wind up with no cash at all.
If you decide at some point to pursue funding from venture capitalists, realize that many of them likely will want to see that you’ve had a successful crowdfunding campaign. That shows you can work well in a team, because you couldn’t have done it alone. It also might show that you pay attention to feedback, can craft a story about your product, and have the stamina to keep pushing when times are tough.
Ask for Help
Most successful campaigns have a team behind them, Hillel-Tuch notes. You might need help making a promotional video or growing a social media following to let people know about your campaign. That’s a lot of work for one person, he says.
You also need feedback, whether it’s about the product itself or tips on how to better describe it. Feedback can help you home in on your audience. You might have thought your product was for teenagers, but then you notice that your friends and family are interested in it for reasons you hadn’t considered. By understanding who your audience is and how the product is useful to them, you’re able to describe how your project can add value to their lives.
“If your campaign is set up well,” Hillel-Tuch says, “people will spread the word about your project to their networks and create a buzz factor.”
Giving your backers a little something extra for funding your project can encourage them to support your idea or invest more than they would have otherwise. For example, offer the first 100 investors the chance to purchase the finished product before it hits the market. Or send a T-shirt to those who give at least $50.
Keep Investors in the Know
Stay in constant contact with your backers. Update them on the status of your project by email, social media, or other means, Hillel-Tuch advises. They’ll want to know if there are delays, and why. They also will want to know about features you’ve added, price changes, the expected launch date, and where they can buy the finished product. If you don’t keep them in the loop, they’ll feel neglected.
Starting a campaign can be really exciting, Hillel-Tuch says. Some projects might even attract news and social media attention once they’re posted on crowdfunding sites. But when the money slows down, it can be disheartening, he says. “Some crowdfunders feel they’ve lost support. This is exactly when you need to keep pushing,” he continues.
That might mean reaching out to more people through social media or participating in live events in nearby cities.
“Your crowdfunding campaign will only move forward if you move it forward,” Hillel-Tuch says. Those who stick it out often find that interest picks up again, and that’s when they reach their funding goals.
This article appears in the September 2017 print issue as “Crowdfunding Your DIY Project.”