Evaluating a Crowdfunding Campaign: 3 Questions to Set Expectations

Meg Weber is the Executive Director of Annual Giving and Gift Stewardship at Colorado State University. She is an Industry Advisor at Community Funded where she participates in developing best practices, advising new product development, and helping clients achieve their fundraising goals.

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When Colorado State University launched our crowdfunding platform, we learned very quickly that a huge role for our team would be helping potential project creators understand the reality of fundraising.

An example: early on, a faculty member called me to talk about a project he had seen on Kickstarter that raised almost $500,000. This project (let’s call it Random Awesome Device, or RAD) had an initial goal of $65,000, so it had achieved huge success. Our faculty member had a similar project in mind, something just as cool that would also make a positive impact on the world, just like RAD.

So, of course a $250,000 goal was realistic.

As we were talking, he pulled up the RAD page on Kickstarter. Immediately, I noticed that it had more than 8,000 supporters and a media section filled with words like:

“Featured on the TODAY show”

“Profiled in the New York Times”

“Covered by Forbes”

Did this professor really think that his project would get that kind of attention? The university marketing department has hundreds of compelling stories to tell, would his be a priority? How would he get his project in front of the tens of thousands of people necessary?

We affectionately refer to folks who think this way as “Field of Dreamers;” people who still believe in the mantra of “if you build it, they will come.”

Except they won’t.

This conversation and others like it have helped us come up with a list of questions we like to ask our project creators before they even set their goals. We try to arm them with information about what to expect, and, most importantly, what is realistic.

Having a good, honest conversation at the beginning of every campaign is incredibly important.

This helps them and it helps us. We want all our project creators to feel successful and be proud of their campaigns. And if they set a goal that is attainable, and then achieve it, we not only get some good word of mouth on campus but other project creators tend to seek us out.

Alternatively, if a project creator sets a goal that is too ambitious and fails, they often blame the platform, or the school, or our staff (which obviously is inaccurate, but still doesn’t feel great).

It’s not a position any of us want to be in. And neither do they.

So, to avoid any misunderstandings, here are some important questions to ask to effectively evaluate a campaign and set expectations:
 

1. Do you know without question where at least 30% of your gifts are coming from?

Bottom line: statistics show that 90% of projects succeed if they have 30% of their funding in the first 48 hours. Those gifts don’t just magically show up. They are usually solicited personally, ahead of time, by the project creators.

 

2. How big is your network?

Be sure to clarify how they define “network.” People they know personally and will ask personally will behave differently than contacts on a social network.  Personal e-mails convert at a much higher rate than social media posts.

Overall, while the mechanism of crowdfunding is online, the asking should be personal.

Even still, something else to keep in mind is that the average gift on our platform is about $70. To achieve a $5,000 goal requires a minimum of 71 donors. If a campaign has a 50% conversion rate on e-mail (which is generous…) a campaign creator would need to e-mail 142 people.

A good follow-up to this question is to sit down with your campaign creator, do the math, and find out if they know enough people they can solicit donations from.

 

3. Is there a marketing plan?


An effective marketing plan includes day-to-day plans, has specific details, and identifies accountable parties. The answer to this question needs to be deeper than “yes, we will market this project” or “we’re going to post it on Facebook when we launch.”

You aren’t doing your project creators any favors by letting them coast on promoting their project.

Ask them how they plan to update donors on their progress and successes. This is during the project and after. During the project, people expect to see progress reports. Sharing successes as the project hurtles toward the finish line is not only good stewardship, it is also an effective solicitation method.

After the project is funded, we try to retain as many of our crowdfunding donors as possible. Our project creators are valuable partners in the stewardship process. They are an active participant in thanking our donors and making sure they see that the dollars they gave were put to good use.

 

At the end of the day, we never have these conversations to scare anyone off from using our platform. We want as many users as we can get!

But for us, arming our project creators with information, things to think about, and suggestions for success ensures that when they are ready to hit the launch button, they are teed up to hit it out of the park.

Community Funded (www.communityfunded.com) provides powerful yet easy-to-use digital fundraising solutions including Crowd Fundraising and Day of Giving products and services that help higher education, healthcare, and nonprofit organizations exceed their fundraising goals.

 

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