Crowdfunding: how to get money for the development of your project?
Crowdfunding is the collective collaboration of people to fund a project. It could be, for example:
product or object – a monument, innovative technology;
service – festival, hairdresser, production;
non-material direction – research, book, application;
target direction – fundraising for orphans, support for political campaigns.
The author of the project must captivate the sponsor with the idea. Projects are published on crowdfunding sites, where the authors show their ideas, and anyone who wants to donates money for them. Crowdfunding can be compared to how you collect money from friends to give a friend an expensive gift, and in return they feed you a cake.
How it works?
what is crowdfunding
The one who finances can be both the buyer of the product, and the sponsor, and the investor. When the creator of the project has received the money, he is responsible to his sponsors. Those who finance the project can choose different types of remuneration. For example, a band concert ticket or an autographed copy of a book. Sometimes crowdfunding acts like a pre-order at a reduced price. If you want to become a project sponsor, be prepared to receive your reward for a long time – after raising money for the project, it may take several months.
Some projects are more successful than others and collect amounts that are several times higher than the original.
There are several types of crowdfunding:
Full amount or nothing
The creators of the project receive money only if the project has collected the entire amount. If the goal is not reached by a certain time, the money is returned to the owners.
The money remains with the creators of the project if it was not 100% completed. The responsibility to investors lies with the author of the project.
To the goal
The project will last exactly as long as it takes to raise the entire amount.
Projects are published on special platforms. Sites charge a commission for their services – it can be a fixed amount or a percentage.
The most popular platform abroad is Kickstarter. At the moment, more than $4.2 billion has been collected on the site. Pebble Technology managed to raise the most money. The company managed to raise $20 million to restart the Pebble watch.
In 2008, Barack Obama used crowdfunding to raise money for the presidential election campaign. For the primary, he raised about $272 million. Sponsors were more than two million people.
In Russia, crowdfunding is more difficult. This is due to distrust of crowdfunding as a phenomenon. Nevertheless, successful projects appear more and more often. In the spring of 2012, on Planeta.ru, the Bi-2 group collected 1.2 million rubles for the release of a new album. The project to raise funds for the film “Panfilov’s 28” raised 20 million rubles.
What sites are there in Russia?
crowdfunding in russia
There are more than ten crowd platforms in Russia, the largest of them are Boomstarter and Planeta.ru.
Boomstarter completed 1886 projects and raised 427 million rubles.
The Planeta.ru project has so far completed 5,000 projects totaling 1 billion rubles. The venue’s record holder is the scientific and educational project “Harry Potter and the Methods of Rational Thinking”, which collected 11,426,381 rubles in the shortest possible time.
Also in Russia, banks and payment systems launch their own crowdfunding platforms.
How to create a project?
how to start a crowdfunding project
In order for people to want to give you money, they need to be captivated. Each site has recommendations on how to design a project. Platforms recommend describing the idea in detail, recording videos and drawing infographics.
Commercial projects are less likely to succeed. Some platforms, such as Planeta.ru, do not post projects related to political and religious activities on the site. Boomstarter does not host projects that offer business start-ups.
For example, a project to open a store (if it is placed on the site) is unlikely to raise money, while the creation, for example, Jackets – jackets that turn into a toy can be successful.
You cannot simultaneously place a project on several crowd sites.
Before submitting a project for moderation, make sure that it meets all the requirements.