Unfortunately, there seems to be more crowdfunding campaigns that fail than those that are successful. Even those who had some preparation failed to achieve their goal or simply didn’t get contributions at all. Why then do these campaigns fail? Today we’re going to give you an answer.

The reason for failure in crowdfunding

Crowdfunding is a financing method that sounds very attractive to entrepreneurs. But once again, we must emphasize that it’s not about publishing a campaign with a great idea and waiting for the money to come by itself. That’s one of the reasons why a campaign will seldom reach its goal.

Still, it’d important to note that there are many reasons why a campaign may fail. And although success is never guaranteed, there are usually some common causes that could have influenced their failure. Let’s carefully study some of them and why they’re harmful:

Your campaign’s goal is not realistic

It’ll be unlikely that you’ll receive contributions if people notice that you’re asking for more money than you actually need. Suppose your campaign seeks to raise funds to make a short film. And after making a budget, you calculate that you need a total of $2,000 to finance its production.

But instead of setting a goal of $2,000 (as you should) you put one of $1,000,000. If you can’t justify the reason for that goal and offer perks according to it, people will feel that you’re not being honest and may feel cheated. Which will take away your credibility from your audience and deprive you of contributions.

China Meet World Kickstarter
China Meet World was a project of a TV series for Chinese audiences with American actor Jonathan “Cao Cao” Kos-Read as host. There was a crowdfunding campaign to finance its making, but it had a goal of $2,646,000 and perks that requested at least $100. It didn’t manage to raise funds. Source: Kickstarter

You don’t have a community to support your campaign

Most of the successful campaigns you usually see online have something in common. They invested money in creating a marketing plan and made deals with PR agencies to reach people and earn contributions. Although you don’t have to do the same, in the end these campaigns fulfilled the task: to attract a community.

You can’t start your campaign if you don’t have a group of people interested in your project, both in social networks and in real life. You can start with your friends and your family, getting them to help you get from 20% to 40% of your goal. Then taking advantage of the momentum and seeking to promote your campaign to larger audiences.

Alan Goren Crowdfunding
Alan Goren, CEO of Investedin, explains that it’s advisable to try to reach 30% of the goal of a crowdfunding campaign in the first 2 or 3 days. Since this happens a lot with successful campaigns. Source: YouTube

There’s no approach or connection with the people

Another common mistake in crowdfunding campaigns is simply publishing content and information on social networks. This alone is not enough. It’s necessary that you also answer any questions or doubts that people may have. And also establish a connection with them in which it’s not simply about convincing them to give you money.

It’s important not only to create an audience but also fill it with emotion. Through more personal contacts such as calls, personalized messages, emails and even face-to-face meetings. This will motivate your audience not only to want to give contributions, but also to share your campaign with other people.

communication crowdfunding
Creating a community means creating links with people who may be interested in your idea or project. It’s up to you to look for these people and know how to maintain good communication with them.

You lack catching perks in your campaign

A factor that also contributes to the failure of a campaign are the rewards (aka perks). In general, campaign owners don’t usually pay attention to their reward systems and this is extremely fatal. Because beyond the passion that someone may feel for your idea, the truth is that their contribution will come for one of the perks you offer.

During the course of the campaign, you need to offer rewards that motivate people to contribute money. Perks of $1, $5, $10 or $20 that contain great and high quality things that are worth having for anyone. Believe it or not, you can create a chain effect through the small contributions of rewards.

crowdfunding rewards
Collaborations, experiences, mementos, physical copies… All this classifies as a perk. According to the e-commerce platform Shopify, the $25 rewards are the most taken and the $100 rewards are the ones that help you raise the most money.

If you fail to take the necessary momentum at the beginning of your campaign, you won’t be very likely to succeed. Remember that in every crowdfunding campaign it’s necessary to carry out a preparation process that requires time invested. Never start a campaign if you haven’t had time to prepare and consider the aspects.

Thank you very much for reading this entry, if you liked it, we invite you to share it on your social networks! That way you can help us reach more people and at the same time you offer interesting and useful content to your friends.

Related: Meet These 5 Crowdfunding Campaigns From Bolivia

Try to avoid these errors in your campaign…