Before your big idea can come to life, funding is necessary to take it to the next level. What separates a mere idea from it materialising is the dollars that go into executing the marketplace plan that you’ve been brewing.
The initial thought that comes to mind about funding usually points to avenues such as bank loans and venture capitalists. Other than these conventional ways to raise funds, an entrepreneur would bootstrap by digging into their own pockets or tapping into their personal social network to get the ball rolling.
More creative and less mainstream avenues to raise funds
Nevertheless, more innovative ways of fundraising have emerged recently, owing to the exponential growth of crowdfunding platforms.
Raising the initial seed capital for your startup or marketplace idea need not be through banks, venture capitalists or angel investors anymore. Crowdfunding platforms such as Indiegogo, Kickstarter and Gofundme can be the answer to your problem.
Almost every other entrepreneur is jumping on the bandwagon to raise money for their marketplace idea after hearing of the magic that has happened on Indiegogo and Kickstarter. These platforms, on which entrepreneurs are allowed to raise funds from the general public, have repeatedly witnessed campaigns raising insanely large amounts of money.
One fundraising campaign that revolves around a truly epic product idea and has seen massive support from the public on Indiegogo is KAISR Original: The Ultimate Inflatable Air Lounge. The amount of funds raised for the campaign has reached over US$4,100,000. This demonstrates the colossal power a campaign wields when executed impeccably.
Be as inventive as possible
Given the proliferation of great ideas, your marketplace idea has to stand out from others to get people to entrust their money to you. For that to happen, you have to be as inventive as possible and pull off a show-stopping fundraising campaign.
Instead of reinventing the wheel, why not come up with something totally fresh that will grab the attention of whom you are targeting! Better yet, do whatever it takes to drive traffic to your campaign and make sure there is something in it for visitors to stay on the page and subsequently donate funds to you.
Set mini goals and perk options for your fundraising campaign
No one can resist a perk in exchange of pledging a nominal sum of money for the project, especially if the perk is unique and cool. It is a win-win situation for both backers and fundraisers. Aligned with this thought, you can take a milestone-driven approach to your campaign by setting intermediate or mini goals. Once these targets are attained, you can offer benefits to backers who have fulfilled their pledges.
Example of a timeline for your crowdfunding project. Photo credit: Indiegogo.
Say the end goal is to raise 1 million SGD. Upon reaching a milestone or mini goal of 500,000 SGD, you want to show your appreciation to people who have contributed. You can offer freebies such as personalised trinkets or even promotional products for your soft launch, depending on what your project involves. There can be different levels of rewards implemented according to the level of difficulty in achieving the mini goals.
Whether or not you hold up to your end of the promise can make or break your campaign. So once you have made a promise, there is no going back, otherwise be prepared to lose your credibility.
Out-of-the-box concepts or strategies
If what you are doing manages to grab the attention of the media, keep at it. Continue to come up with marketing campaigns that have not been thought of, or a new way of doing things that will generate curiosity and interest from the public. The media, be it online or traditional offline news outlets, would scramble for newsworthy pieces that can garner public attention.
Media coverage of projects on these crowdfunding platforms from time to time can bring your idea to the attention of potential backers and investors, which could potentially attract even more funds to fuel your burgeoning marketplace.
Engage your community
At the core of your fundraising campaign is the people, who are interested in seeing through the execution of your idea. Hence, it is critical to grow this community and to sustain engagement with them for continual support. You owe your success partly to them. After all, these are the people who are willing to have a stake in your marketplace.
One approach to it lies in holding offline events, but the catch here is to be unique. For example, you can have a cook-off contest with your community if your marketplace has something to do with food. A boon that comes out of these events is the facilitation of dialogue with them to gather feedback, which is essential to improving on your idea.
Offline marketing is also complementary to online marketing efforts in the social media sphere. Both sides reinforce each other in amassing media and public attention. News agencies may also pick up on your offline event if it gains enough buzz. Simultaneously, your community would feel engaged and appreciated, paving a smoother transition into them pledging (more) funds and getting others to do the same for your idea.
For every inventive way you execute your fundraising campaign, there needs to be a clear call to action. This is what elicits people to pledge money that goes towards making your marketplace a reality.
If you haven’t noticed, the main objective in being as inventive as possible is to maximise engagement with the community that will fund your idea, especially on crowdfunding marketplaces such as Kickstarter. So go wild with your imagination and make sure your creative efforts are right up the alley of the community you wish to target.
Regardless of how novel your ways of raising funds are, having a clear vision of your marketplace alongside a succinct yet convincing presentation of your proposal still takes precedence. Only once this bedrock has been set in place, can the rest fall nicely into place.
As you come up with creative ways to fund your marketplace, it would be good to figure out what the Lean Startup Methodology is along the way.