Start-Up and Small-Business Crowdfunding
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Beginnings are though. Either if starting a company or developing a new product, the first few steps in the unknown can get you overwhelmed.
Will the company be successful? How your customers are going to react to your new product? Will you have enough funds to keep up the pace?
When it comes to startups and small business, regardless of how high or low the fund’s streams are – crowdfunding is a must.
Building a Community
Crowdfunding concept implies that you have a product, idea or a need presented in the form of an online pitch to large audiences. Regardless of the crowdfunding model, you choose to cope with it. Crowdfunding at its core is about investments from people around the globe! And, what differs everyday users from crowdfunding ones, is exactly that – skin in the game attitude which goes beyond consumerism.
Their investment can range from reward, equity or donation based concept, but the end result is always the same. If a person believes in a small business or a start-up enough to invest, they are going to be the first to spread the word about your brand. Crowdfunding investment in a small business or a start-up transforms average users to a large community.
That steps forward as your first batch of brand ambassadors is proud and eager to share their experience with you!
Picture 1. Building an international online community
Market Research, Validation and Knowledge
What is the best way for small businesses and start-ups to conduct market research and validation, than by presenting their ideas and business plans to the end users?
Going through the creation process, you may have overlooked some crucial elements in the product or service design. Maybe your business plan has a blind spot that you don’t know about. People from all around the globe will be able to share their thoughts and insights on what they like with your concept and what should be pushed out in the next phase.
Crowdfunding preparation implies great marketing know-how. Starting from creative materials you’re going to use, over the angle you’re going to present to your backers and benefits to your end users. Everything plays a role in your campaign success.
Picture 2. Acquiring marketing knowledge
Crowdfunding Debt is Flexible
Small business loans in banks usually take up to 3 months before being processed and approved. Also, most of the bank loans are specific to what your funds are intended.
That investment approach is oriented towards old-school business models. When going into crowdfunding debt, the platform, crowdfunding type, and your campaign dictate the way you’re out to pay your debt.
For example, reward-based crowdfunding debt will be paid off as soon as you send out all the rewards to your backers. Equity, on the other hand, means that you and your legal team will be having to conduct a set of rules for the equity part of your backers.
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