Crowdfunding

Crowdfunding adresses early adopters. The final solution is offered to the public or a part thereof before the actual launch and/or finalized production, e.g. through your own website or crowdfunding platforms like Kickstarter. Buyers commit themselves to buy the solution once it is ready, thus demonstrating their interest in the offering and a willingness to pay for it.

Step-by-Step Guide:

1. Define Goals: Outline your project, set a realistic funding goal, and create a budget breakdown.

2. Select Platform: Choose a platform that suits your project (e.g., Kickstarter for creative projects, Indiegogo for flexibility).

3. Create a Campaign: Develop a compelling story, add visuals (videos/images), and offer attractive rewards at different funding levels.

4. Pre-launch Promotion: Build momentum by engaging with your community and reaching out to influencers before launch.

5. Launch and Promote: Actively share the campaign on social media, send email updates, and seek media coverage.

6. Monitor and Update: Regularly update backers on progress, thank supporters, and be transparent about challenges.

7. Fulfill Rewards: Deliver on promises promptly, keeping backers informed of timelines.

8. Thank Backers: Show gratitude and continue engaging with your supporters for future opportunities.

This guide provides a streamlined approach to running a successful crowdfunding campaign.  

Example:

In 2012, Oculus VR, the company behind the Oculus Rift virtual reality headset, launched a Kickstarter campaign to fund the development of their product. Their campaign became a prime example of effective crowdfunding.

What They Did Right:

1. Clear Goals: Oculus set a funding goal of $250,000 but exceeded it significantly, raising over $2.4 million from nearly 10,000 backers. They clearly communicated the vision and goals of creating a revolutionary virtual reality device for gamers.

2. Compelling Story and Product: Oculus VR showcased the innovative potential of their technology and how it could transform gaming. Their video and campaign story engaged both tech enthusiasts and gamers, creating a strong emotional connection.

3. Attractive Rewards: The campaign offered compelling rewards, ranging from early prototypes to developer kits, which appealed to a wide range of backers, from enthusiasts to developers.

4. Community Engagement: Oculus actively engaged with their community during and after the campaign, regularly providing updates and involving their backers in the development process.

5. Strong Pre-launch Marketing: Even before the Kickstarter launch, Oculus built excitement and anticipation by demoing the Rift at gaming and tech conventions, creating buzz among potential backers.

As a result, Oculus VR became one of the most iconic crowdfunding successes, ultimately leading to their acquisition by Facebook in 2014 for $2 billion. This campaign is a prime example of how effective planning, storytelling, and community engagement can lead to a crowdfunding triumph.

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For more information on the topic, please see the source below:

Böckel, A., Hörisch, J. & Tenner, I. A systematic literature review of crowdfunding and sustainability: highlighting what really matters. Manag Rev Q 71, 433–453 (2021). https://doi.org/10.1007/s11301-020-00189-3  

Shneor, R., Zhao, L., & Flåten, B.-T. (Eds.). (2020). Advances in crowdfunding: Research and practice. Palgrave Macmillan Cham. https://doi.org/10.1007/978-3-030-46309-0

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