With over $9 billion raised around the platform since its inception in 2010, GoFundMe has a reputation for campaigns which help cover the expense of personal emergencies in a world where most of us are just one missed paycheck away from ruin. But as the company has become symbolic of charitable crowdfunding, you will possibly not realize that you should use GoFundMe for business funding too.
Now, don’t get me wrong: In case your venture is really a high-tech startup with exponential growth potential, or maybe you’re allowing the next tabletop gaming sensation, you’re going to be best using a more commercially-oriented crowdfunding platform, for example Kickstarter or Indiegogo. Or perhaps you could check out one of the new equity crowdfunding sites that have put their hands up in recent years.
However, for the best type of startup business — preferably one with a local/community focus and a compelling story to inform about overcoming adversity — GoFundMe is an attractive fundraising option. One big reason? GoFundMe charges no platform fee to individual campaigns launched in the US, UK, Canada, Australia, and areas of Europe. The normal crowdfunding site takes 5% of what you raise.
I’ll give three real-world examples of people using GoFundMe to fund a company and finding success:
- Two Detroit students raised $3,000 to fund their socially-conscious waffle cookie company
- Owners of a Bay area restaurant raised $50K to get away from debt
- A veteran raised $2,000 to begin his motorcycle repair shop
Read on for the ten steps you need to follow to obtain money from GoFundMe to start a business.
1) Consider The Pros & Cons Of utilizing GoFundMe
GoFundMe is really a prominent brand with near-universal recognition, so GoFundMe campaigns immediately get a bit of a credibility increase in your eyes of many would-be donors. So that as I pointed out within the intro, GoFundMe charges no platform fee in most of the countries that operates. You can also collect the funds you raise even though you don’t meet the funding goal you place.
On the downside, GoFundMe’s customer support isn’t always the best, plus some campaigners run into trouble when trying to withdraw the funds they’ve raised. Additionally, you need to provide your full Ssn whenever you withdraw your funds, which, for self-evident reasons, isn’t ideal. However, in case your business is suitable for the woking platform (more about that in the next point), GoFundMe has more positives than negatives.
2) Explore Options to GoFundMe
Before using GoFundMe to start a business or fund a current business, consider whether your venture is a great fit for GoFundMe. Most of the types of startups and businesses currently finding crowdfunding success are in industries that enjoy commercially-oriented platforms such as Kickstarter: makers of apps, gadgets, and games who typically don’t have an offline presence in the form of a restaurant or shop. Likewise, Patreon has become a leading crowdfunder for podcasters, musicians, graphic artists, along with other creatives whose work easily disseminates online.
Crowdfunding with GoFundMe is really a different matter, however. Donors have a tendency to contribute to GoFundMe campaigns not to enter around the latest tech trend or trendy tabletop game but to create a positive improvement in people’s lives or to benefit their community. Consider the sort of businesses that have had successful GoFundMe campaigns, and you’ll observe that they sometimes feature either a) a business which has a positive effect on public life inside a community and b) an entrepreneur/business owner with whether sympathetic and compelling personal story to inform or a mission that’s associated with charity or social justice.
If neither a) nor b) applies to you and your business, then you’d need to be seeking funding from one of the other crowdfunding outfits I’ve mentioned. If a minumum of one of the two does apply to your efforts, you stand a decent shot at making GoFundMe work with your company.
3) Develop A Business Plan & A Realistic Funding Goal
Have your own business plan ready before you start publicly campaigning for money. Particularly, make sure you set a funding goal that you expect to be able to meet. Define precisely what you plan related to the money you expect to raise so that you know how to proceed next if you reach your funding goal.
Of course, all the best-laid plans on Earth won’t help you if you don’t manage to raise any money. One method to improve your chances of crowdfunding success is to offer cool rewards to individuals who donate to your campaign.
4) Set Up A GoFundMe Campaign
If you’ve chose to use GoFundMe for business, it’s time to setup your campaign. GoFundMe makes this really simple. Registering for an account is provided for free and just requires your name, email address, and password. After that, one enters the fundamentals of your campaign — your location, fundraiser title, your fundraising goal, your story, some images or videos, and some additional information. After completing everything, you’re ready to go live.
Of course, you don’t wish to go live until you’ve come up with most appealing campaign possible. Let’s discuss how you can do this.
5) Offer Multiple Reward Tiers
Remember when I said that GoFundMe donors are motivated mainly by the need to do good? Although this could be the case, you’re still competing for the limited attention of donors with all the other campaigns listed on the site. That’s where rewards come up.
With GoFundMe, just like Kickstarter and lots of other crowdfunders, you can offer multiple levels of rewards to people who contribute to your campaign. Which means you can offer increasingly higher-value rewards to individuals who donate larger levels of money. My advice would be to take advantage of this crowdfunding feature and provide multiple reward tiers to your would-be donors. Give people grounds to feel invested in your ability to succeed!
While branded trinkets and t-shirts might draw some people in, rewards that provide people a taste of your product or service are better still. Give discounts, coupons, or gift cards for anything you have to give you. Get people in the habit of frequenting your company, and they’ll become more likely to give you their business with an ongoing basis.
6) Refine Your Campaign Pitch
When creating your GoFundMe campaign page, you’ll want to make it as appealing as possible.
- Post A Fun Campaign Video: Keep it to around two minutes so that you don’t lose viewers’ attention. Don’t hesitate to exhibit an individual touch, as people prefer authenticity and humor to slick sales pitches. You need to at least allude towards the personal challenges you’ve faced in growing your company. In the end, this really is GoFundMe; tugs around the ol’ heartstrings are required.
- Make Your GoFundMe Campaign Page As Attractive As you possibly can: Use high-resolution images to advertise your campaign. Preferably images that feature both you and your place of business. Remember that using a personal touch is essential.
- Write A Descriptive Title: Attempt to summarize what your campaign is about with one phrase. Don’t just write “Small business Help” — that doesn’t tell anyone anything or capture their interest. A good, catchy title can help distinguish your campaign from the a large number of others enjoy it!
7) Seek Support From Friends & Family Before Launch
Not to diminish the significance of marketing your campaign to the public at large, but your most significant supply of support is likely to be your individual network: friends, family, co-workers, acquaintances, etc. They are not only likely to contribute a significant proportion of the items you raise, but it’s essential to secure their support before your campaign goes public. This way, whenever you launch your campaign, strangers who come across it won’t see “$0” because the amount raised. Success breeds success, and it’s easier to attract public support when you’ve already secured a good slice of funding.
You might have family members donate anonymously if you don’t want people knowing how much of your support comes from relatives!
8) Market Your Campaign Via Social Media & Email
To build buzz around your GoFundMe campaign, you’ll need to sell it off on your social media channels. Use Facebook, Twitter, Instagram, and the like to spread the word regarding your story and your campaign. If you're able to, attempt to collect the email addresses of these thinking about your campaign to construct a subscriber list. This can be used list to provide updates in your business’s progress and whatever other behind-the-scenes material you want. You can use e-mail marketing services to keep your followers updated with attractive template-based emails detailing your progress.
Try to build up some press contacts too. When you’re about to launch your GoFundMe to start a company, you can alert these contacts in advance.
9) Keep Everybody Updated After Your Campaign Launches
There’s grounds it’s called a campaign — you have to strive to keep the contributions flowing! The uncomfortable truth is that many crowdfunding campaigns, whether or not they be for business or personal causes, don’t reach their funding goals. If you wish to beat the chances, a compelling story along with a nifty video won’t be sufficient. You’ll need to work on your campaign continuously as if it were your work.
Once your campaign is in full swing, keep everyone informed with frequent updates. Don’t just post updates to your GoFundMe page — make sure to send out updates through all of your social networking channels as well. Go on and get personal with your updates. Don’t just rattle off a list of statistics. Document your continuing personal involvement in your campaign for business funding. Be sure to react to anyone with questions regarding what you’re doing, both in your GoFundMe For Business page and social networking.
10) Stay Engaged Together with your Backers Post-Campaign
Let’s say you overcome your challenges and meet your funding goal. Fantastic! Now, what exactly are you going to use the contacts you’ve made, the followers you’ve attracted, and the subscriber list you’ve started? If you would like your company to thrive, you won’t just let them drift away.
Consider an email campaign to maintain your contacts apprised of your latest doings and to offer special promotions. Stay active on the social networking channels you accustomed to such great effect during your campaign. Maintain the relationships you developed together with your first customers. These folks will be your most important evangelists, spreading the great word about your business and the friendly, personable owner who treated them so nicely.
People long to experience a communal feeling within this lonely world. Give them one, and they'll reward you.
