|In recent years entrepreneurs and SMEs may have found it difficult to access funding from traditional sources. As a result a growing number have been attracted to alternative ‘peer to peer’ investments to help them fund projects and business opportunities. Known as ‘crowdfunding’ this alternative investment source presents a very interesting option.
Wikipedia define Crowdfunding as “the practice of funding a project or venture by raising monetary contributions from a large number of people, typically via the internet.
“According Funding Circle, one of the UK’s leading lending platforms they’ve facilitated £330 million of loans by 30,000 people to 5,500 businesses since 2010; and the Government has made £60 million available to Crowdfunding since 2013.
If you have a business idea that needs investment – crowdfunding may be an idea worth investigating; getting started isn’t difficult and you’ll find pages and pages of information and case studies online. Should you decide to go down this route and launch your own crowdfunding project, you’ll need to start with a good pitch.
Your pitch can make or break your crowdfunding efforts. Make sure it outlines a fundraising goal, a timeline and what rewards are being offered in exchange for investment. It should clearly state exactly what your business idea is, its key selling points and marketplace differentiators. Here are some additional points you’ll also want to address:
Make sure your pitch showcases not only the project itself but the people that are going to make it happen. A short, simple and engaging video is a great way of doing this. In fact, your entire presentation shouldn’t be more than 2-3 minutes. Download your video onto USBs and leave them with would-be investors.
Once you have the perfect pitch, you need to launch it. Contact friends, family, colleagues, the media, the community at large and organisations with similar interests. Create distribution lists and post your request for investment to various social media platforms asking your contacts to share your post. If you’re looking for investment greater than £5,000 include a lending platform such as Funding Circle to widen your reach.
Remember to let investors know what’s in it for them. Although you may have friends and family who want to participate to show their support, most will want something in return for their contribution. Here are some ideas:
Crowdfunding can be a great way to generate funds for new business ventures. A simple pitch, a great idea and a lot of passion will go a long way.
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