Kickstart(er) Your Idea: Idea Design Studio’s Tips for When It’s a Good Idea and When It Isn’t
Crowd funding is not for everyone. Raising capital is one of the biggest challenges that inventors face. Many turn to crowd-funding sites to raise the money they need to take their idea to the next level. Crowd funding offers a solution for many, but for others, it may not be the best way to raise money. Idea Design Studio has several tips for when it’s a good idea and when it isn’t. But, first, you need to have good understanding of crowd funding and how it works. What is Crowd Funding? There are multiple crowd-funding websites out there, including Kickstarter, Indigogo, GoFundMe, and more. Individuals or small business owners set up a profile, tell their stories, and ask people to donate, sometimes as little as $5. Usually, a goal is set, and inventors sometimes offer donors something in exchange for their donations. For most crowd-funding sites, the money given is a donation or investment. Others serve as loan sites, where people raise money but then pay it back over a specific timeframe. Many sites are all or nothing, meaning that the person raising the money must reach their goal—partial payments aren’t allowed. So, inventors need to know how much money they need before setting up a campaign.
The Benefits of Crowd Funding Raising cash is, of course, an important benefit of crowd funding. But, what’s even more beneficial is that you are getting the word out about your invention and building a customer base among those with a stake in the business’ success. According to Idea Design Studio, successful crowd-funding campaign depends on a having compelling story. This is what compels people to donate. Crowd funding provides an avenue for new inventors to get noticed and get recognized for their ideas outside of their normal circle. This is something that wasn’t possible in years past. Idea Design Studio recommends crowd funding for inventors who have a solid product, an interesting story, and a clear understanding of how much money they need to raise. Additionally, we strongly recommend our inventors to have started the patenting process before going public with a crowd funding campaign.
When NOT to Use Crowd Funding Crowd funding isn’t for everyone. First, it’s a lot of work to set up a campaign and include the essential elements that will get it noticed. Then, you have to market and promote the campaign so that potential donors know you’re out there. Idea Design Studio recommends that inventors not use crowd funding if they have not properly vetted their ideas. It’s also not a good idea for those who have not done the numbers to see how much they need to raise. What happens if you underestimate what you need and raise too little? Another issue is that some crowd-funding sites require people to offer something in exchange for the donation. Idea Design Studio suggests that you carefully evaluate any incentives that you plan to offer so that you can fulfill all promises. At Idea Design Studio, we know what it takes to have a successful invention and how to help inventors raise capital. If you’re considering using crowd funding, give us a call on our inventor hotline at 888.864.1780 or email us at info@ideadesignstudio.com.
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