By Valtteri Kaartemo, Head of Research at Masar Smart Energy
Each successful entrepreneur seems to have an opinion on how to design and manage a crowdfunding campaign. Unfortunately, these comments tend to overemphasize the personal experience, and it is challenging to tell whether this advice is valuable for another fund-seeker in another context. I have also been involved in a couple of successful crowdfunding campaigns, and honestly I would not feel comfortable saying that everything that was done in these campaigns influenced its success. Therefore, I do not give my answer based on my reflections. Instead, I let the science tell us what influences crowdfunding performance for real.
As I was curious answering to this question, I reviewed 51 crowdfunding performance articles that had been published in scientific journals by the end of 2016. As a result, I identified four main categories that affect crowdfunding performance: (1) campaign-, (2) crowdfunder-, (3) crowdfunding platform-, and (4) fund-seeker-related factors.
The results show that some of the ideas suggested by seasoned entrepreneurs do not necessarily affect crowdfunding performance positively. Yes, rewards are important for attracting crowdfunders but, for instance, it is not clear how many reward tiers there should be. One research says that a greater number of reward levels is associated with crowdfunding performance, and the other one says that fewer meaningful reward tiers are characteristic to successful campaigns. In addition, it seems that the role of rewards varies between crowdfunding categories. Interestingly, in equity-based crowdfunding it is more likely to meet the funding target when less equity is given away, thus signaling the fund-seeker’s belief in the potential of the company. These findings show that the answer to the question (“How to ensure success in crowdfunding?”) is not a simple one.
Moreover, academic research indicates that it is not enough to have a video to meet the funding target. In fact, my review reveals that there are far more sophisticated findings on how to signal quality in a crowdfunding campaign. For instance, Kim et al. (2016) thoroughly studied signaling credible claims in crowdfunding campaign narratives and found that the language of precision and distinction, such as having a completed campaign; having more referrals, funders, updates, and images; having longer word counts; and containing more negative emotional text influence crowdfunding performance positively in Indiegogo. Tirdatov (2014), in turn, found that the most well-funded projects contain three types of rhetorical appeals: ethos (emphasizing credibility of the speaker), pathos (producing emotions in the crowd), and logos (supporting claims through logical argumentation).
In addition to campaign-related attributes of a successful crowdfunding campaign, it is good to acknowledge the role of crowdfunder-, platform-, and fund-seeker-related elements. Understanding what kind of people typically fund certain campaigns helps fund-seekers to address their message to them, and to find a platform that is friendly to their project. Here, it is also important to be aware of yourself and how to present you and your company to the crowd.
My review provides the first systematic literature review on crowdfunding performance. By revealing state-of-the-art of elements of crowdfunding performance and classifying them in four categories the review helps both entrepreneurs and civil activists in designing campaigns that are more likely to meet the funding targets, as well as crowdfunding scholars to develop the field. The review shows that the results are partly mixed, and the attributes moderate the influence of each other. Therefore, it is awfully difficult to answer to this question at the early stage of crowdfunding industry. We just need to wish crowdfunding researchers give us more answers to this multi-billion dollar question. This would enable entrepreneurs to be more strategic rather than intuitive in designing and managing their crowdfunding campaigns.
Kaartemo, Valtteri (2017) The elements of a successful crowdfunding campaign: A systematic literature review of crowdfunding performance, International Review of Entrepreneurship, Vol. 15, No. 3, Freely available from:
This story was originally published here on September 4, 2017
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CrowdRise’s 6th Annual Holiday Challenge will offer new platform upgrades and $500,000 in prizes and matching funds
Press Release – DETROIT, MI – CrowdRise announced that its annual holiday giving campaign will be sponsored by Newman’s Own Foundation, with $500,000 in funding and matching donations for participating charities. The Challenge, which launches November 21, is now accepting charity applications at crowdrise.com/NewmansHolidayChallenge.
To provide charities an even greater holiday campaign experience, CrowdRise is offering new tools that turn traditional fundraising efforts into amplified social fundraising campaigns. The optimized features include:
This year’s sponsor, Newman’s Own Foundation, is celebrating 35 years of giving back to charities. Since Newman’s Own was founded, close to $500 million has been donated to charitable organizations. To celebrate, the Foundation has committed another half a million dollars to help charities in the Holiday Challenge supersize their holiday campaigns. The Challenge, which will kick off just before #GivingTuesday on November 21, will offer special prizes and promotions on #GivingTuesday, November 28.
“Newman’s Own Foundation is pleased to support the CrowdRise Holiday Challenge, which will help so many charities in their efforts to increase donations through crowdfunding,” said Kelly Giordano, Managing Director of Newman’s Own Foundation. “This is our fifth year working with CrowdRise, and we’ve seen many of our grantees benefit through these campaigns.”
“We’re thrilled to work with Newman’s Own Foundation to give charities all the tools they need to make their #GivingTuesday and holiday giving campaigns a success,” said Rob Solomon, CEO of GoFundMe, CrowdRise’s parent company. “Through CrowdRise, charities can reach new people, spread their message, and deepen their engagement with donors like never before.”
The application is now open, and charities will be accepted to the Challenge on a rolling basis through Tuesday, December 5. All 501C3s are invited to fill out the short application, and accepted charities will have their custom branded, optimized webpages built for them. CrowdRise allows provides a challenge toolkit with, tips, assets and templates to create professional and customized fundraising campaigns for competing in the Challenge. The Newman’s Own Foundation Holiday Challenge launches on Tuesday, November 21 at 12:00pm ET and runs through Wednesday, January 3 at 1:59pm ET.
For more information or to donate visit crowdrise.com/NewmansHolidayChallenge
CrowdRise is the world’s largest crowdfunding platform dedicated exclusively to charitable fundraising. Used by millions of individuals, tens of thousands of charities, hundreds of companies and many of the most famous artists and athletes in the world, CrowdRise enables people to creatively leverage their resources and networks to unlock the power of the crowd to support positive social missions and create massive impact.
Founded by actor Edward Norton, film producer Shauna Robertson and Robert and Jeffrey Wolfe, CrowdRise has conceived, implemented and powered campaigns that have raised hundreds of millions of dollars to date. For more information visit www.CrowdRise.com. In January 2017, CrowdRise merged with GoFundMe to offer both people and organizations the best fundraising tools for any cause they care passionately about.
About Newman’s Own Foundation
Newman’s Own Foundation was founded by the late actor Paul Newman to continue his philanthropic legacy and help make the world a better place. Newman’s Own Foundation turns all net profits and royalties from the sale of Newman’s Own products into charitable donations. Since 1982, Paul Newman and Newman’s Own Foundation have donated close to $500 million to thousands of charities around the world. For more information, visit www.newmansownfoundation.org.
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Press Release – Indiegogo was created to empower people to unite around the innovative ideas that inspire them, and together make those ideas come to life. For almost 10 years we’ve been working hard to help early adopters get clever new products, regardless of where a product is in its lifecycle. We’ve been busy launching partnerships to empower entrepreneurs with the resources they need to make the products they’ve dreamed of and get them into your hands. Starting today, we’re giving backers direct access to clever new products that are completely ready to ship through The Indiegogo Marketplace.
The Indiegogo Marketplace
Today we’re launching the Indiegogo Marketplace to help you get the clever innovations that you just can’t find anywhere else. Interested in being a part of something groundbreaking? Discover the next big thing through Crowdfunding and InDemand campaigns. Or if patience isn’t your strong suit, you can check out the Indiegogo Marketplace to find the products you love – all with guaranteed shipping.
Clever Things Just For You
We’re also making it easier for you to find the things that you care about most with a new homepage curated just for you, complete with editorialized content to help you learn more about what we’re doing, what our campaigners are doing, and what’s going on in the industry. When you log in we’ll be serving you personalized recommendations front and center based on your customizable interest profile.
Gogo Pop-Up Store
We think this deserves a celebration, so we’re kicking things off with the Gogo Pop-Up store. This limited-time-only pop-up store features some of our favorite products and exclusive deals. We’re also putting together special holiday gift guides to help you choose the perfect things for the people you love. And don’t worry about whether your cousin’s present is going to make it in time: everything in the Gogo Pop-Up store is guaranteed to ship for the holidays.
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This is a guest post by Rashaan Everett, the founder of The Greenwood Project, a startup dedicated to rebuilding Black Wall Street. He’s now dedicated to social entrepreneurship full time after Greenwood’s first funding raise; following stints with Accenture, Capital One, and Morgan Stanley. Rashaan has a B.S in Finance from Howard University and currently resides in his hometown of Long Beach, California.
Let’s take a moment to refocus. It’s been five years since the rise of social media-powered activism. The murder of Trayvon Martin in 2012, amongst other events, ignited a new wave of civil rights organizing and consciousness. Technology has played an undeniable role in this most recent chapter in our fight for equality. For the first time, videos of social injustice are broadcast directly to the world, and we can strategically leverage social media to empower ourselves with a voice that is too loud- and too widespread- to be silenced. Indeed, social media’s most important attribute is the dilution of a mainstream media that does not seek the voices and experiences of those who are not…mainstream. In this way, it has proven more democratic than traditional media could ever be.
Not surprisingly, we have more than taken advantage of this phenomenon. We heavily influence popular culture and sociopolitical discourse on several platforms like Twitter and Instagram. Social media has birthed a new generation of leaders, and the lines distinguishing “Black culture” and “pop culture” are rapidly blurring.
Our participation, energy, creativity, and leadership help power these billion dollar technology and social media companies, so why don’t we own a financial stake in these industries and use them to advance our communities? Technology, in general, provides an unprecedented opportunity to achieve more progress than our grandparents ever could. It’s time to channel our influence and dollars into building Black Business. But how?
Let’s try something different. Together we can double the number of Black-owned businesses over the next ten years. Since 2012, many Black Americans have reignited their passion for championing community progression. So far, however, we’ve achieved awareness, but little tangible progress. Harnessing the link between social change and financial independence is constantly being discussed, aimed at educating and uniting our communities. However, there’s been a lack of focus. What do we do now that we’ve decided something must be done? It’s time for us to put our money where our mouth is.
Barack Obama passed the JumpStart our Business (JOBS Act) to level the playing field for all entrepreneurs. Still, the major component of this legislation was activated just 17 months ago: Equity Crowdfunding. Equity Crowdfunding allows any American to own stock or debt in a private business for the first time in 83 years. It’s revolutionary, and this technology has the potential to transform Black economics. Since 1933, the wealthy enjoyed a government-protected monopoly that prevented middle-class Americans, and 98% of African-Americans, from investing in high-potential startups. To put it simply, White people have earned trillions through Silicon Valley’s technology since the year 2000. This is why the wealth gap is getting worse: it’s easy for the rich to get richer and almost impossible to overcome the hurdles without family-based wealth. Consider this: even if the founders of Uber came to your door 5 years ago with a great idea and asked for $100, it would’ve been illegal for you to invest in it (if you did make that investment, it’d be worth over $90,000 today).
Let’s use our mastery of social media technology to facilitate Equity Crowdfunding – the tool we can use to rebuild Black Wall Street. With just a few clicks, anyone can invest in a Black business. There can be opportunities to invest in franchises, cannabis companies, purchase shares of real estate, buy equity in creative projects or tech startups, and now anyone can loan money to Black entrepreneurs to fund their movies, restaurants, museums, bars, or literally any project that you believe me.
Think of it like a GoFundMe Campaign, but instead of donating to a cause; supporters can purchase equity or give a loan to support a business idea that matters to them and their community. It’s a game changer. Entrepreneurs can launch projects and use their friends and family as an investor base. Now, minority communities can raise money from each other instead of relying on the banking system or wealthy angel investors who don’t look like us. Even better, when these businesses succeed, the profits are returned to the same minority / middle-class investors; retaining and recycling wealth in our community like never before.
I challenge all aspiring entrepreneurs to launch that creative idea. You should know that there’s a new source of financial funding that doesn’t require convincing rich investors who may not relate to you that you have a good idea. I challenge today’s business owners to double down their focus, explore expansion and growth opportunities, and recognize Regulation Crowdfunding can propel your business to new heights. Building wealth begins with investing. People of all ages should consider making their first investments today, even if it’s only $100. If you’d appreciate updates regarding investment opportunities, sign up here
More established professionals should read about how Regulation Crowdfunding can diversify their portfolio. There is tangible wealth to be earned at all levels, with numerous investors pledging as much as 100k to Reg CF campaigns. In the Black community, we need to challenge our leaders and athletes to make these type of pledges to invest in minority communities today.
For the first time, there’s a tangible way to support our cause that doesn’t require donating money. Now, you can make a huge impact, and earn a financial reward too. There are no more excuses.