In a nutshell, there are 3 Main Pillars you should focus on: Marketing, Product, Legal
We largely covered the Marketing aspect in our previous video.
But one aspect to really focus on is building your mailing list. Driving early sign up will give you a pool of potential backers to re-engage and tap into once you launch your campaign.
What is key here is to set a target goal for the numbers of emails you plan to collect, based on your fundraising goal, and to assume a conservative conversion rate from “interested” leads, to backers. For example, let’s assume you’re raising $100,000.
With your product and crowdfunding ￼ticket worth a $100 per donor, you will need to engage a total of a thousand backers to reach your target. But if we take a conservative conversion rate of 8% from the early bird backer emails you collected, you will need a minimum of 12,500 emails … an ambitious number to work towards.
We mentioned before that the best way to go about this is to put your social media platforms to work. Be prepared to spend on online social media campaigns to generate signups, and collect the emails of potential leads. When it comes to the product there a few elements to think about –
Identify partners you are confident working with - both locally and internationally.
Finalize your design for manufacturing and set clear contracts with your manufacturers.
Understand the timeline for production, and define what the production pillars are within this stage so that you can be ready to deliver once the crowdfunding campaign is closed.
In terms of product pricing, use a 4 x rule: if the manufacturer gets $25, then you should sell at $100. Also factor in production/manufacturing and shipping costs, if you are producing a tangible product. Price should stay fixed after the campaign, though you should think of offering a very early discount as an incentive for your backers to join in the crowdfunding campaign.
Another important topic – the Legal side of things
Registration, legal protection and certification are additional costs to consider. Register your company in the country you’re fundraising in: for example, if you are planning to use Kick starter, you will need to be incorporated in the US.
Make sure you protect your idea: think about patents and brand trademarks before going public. Because a patent can take time and is often relatively costly, you can consider a provisional patent until you have collected the funds to obtain full rights.
Start with localized patents for the countries where you are manufacturing and selling. You can then obtain the rights for more countries as you expand to new markets over time. Finally, being certificated will become important post crowdfunding, once you start distributing through retail.
Next, let’s look at what you should consider once you’ve officially launched your campaign and after you reach your goal – which is as important as the pre-campaign preparation phase.