Crowd-funding yourStartup:what every entrepreneur needs to know aboutthe biggest game-changer in startup fundingSulin Lau,...
2USA: 60%of every $Crowdfunded
3
4This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tips...
5This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tips...
CROWDFUNDING IN PLAIN ENGLISHLots of individuals contribute small amounts... they add up to fund a creative project, a bus...
7REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDING4 differentmodels ofcrowdfunding
8REWARDSContribution > $X,gets you a coolreward from thestartupDONATIONEQUITY(INVESTMENT)CROWDLENDING
9REWARDSDONATION“give andget nothingin return butfeelgood”EQUITY(INVESTMENT)CROWDLENDINGPeer-2-peer lendingfor low or noin...
10REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDING
11REWARDS DONATIONEQUITY(INVESTMENT)crowd earns equity,debt, or a revenueshare for theircontributions(pending JOBS act)CRO...
12Over the years,models haveoverlapped.
13REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDING
14REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDINGNote:Sites selected for discussion are those with highest traffic in each ...
More and morecrowd-funding variantsevery year...15
16This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tip...
17Q1:What kind ofproject/ bizis it?
18Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearrevenueInnovative“sexy” idea -uncert...
Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” ...
Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” ...
Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” ...
22Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy...
23Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy...
24Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy...
WHATCONTRIBUTORSRECEIVEDONATION + REWARD(pre-selling goods,pre-determined rewards)DONATION + REWARD(pre-selling goods,pre-...
“So now I’ve chosen themost suitable crowdfundingsite or sites for myself”...What’s Next?26
27Rising abovethe Noiseof all crowdfundingcampaigns fail.71.3%
28This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tip...
29Don’t forget to include the crowd-funding platformsuccess and/or failure fees, any credit card fees (usually2-3%), all r...
&• Syracuse IVMF a Kiva Zip trustee since Nov 2012• Endorsed 3 EBV graduates based on business plan, financial situation & ...
What the endorsement looks like (Gerald’s example)31
Questions?- about crowdfunding options in general- about Kiva Zip specifically32
331) Broad search:what different crowd-funding sites exist?2) Compare & Select:Of the larger sites serving my type of biz,...
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Crowdfunding Guide for Small Business - Includes Comparison of Size/Costs/Success rates of Top Crowdfunding Sites

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Crowdfunding Guide for Small Business - Includes Comparison of Size/Costs/Success rates of Top Crowdfunding Sites

  1. 1. Crowd-funding yourStartup:what every entrepreneur needs to know aboutthe biggest game-changer in startup fundingSulin Lau, Kiva Zip Fellow USA@sulinlau // sulin.lau@fellows.kiva.org
  2. 2. 2USA: 60%of every $Crowdfunded
  3. 3. 3
  4. 4. 4This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tips for yourCampaign:How Not toFail
  5. 5. 5This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tips for yourCampaign:How Not toFail
  6. 6. CROWDFUNDING IN PLAIN ENGLISHLots of individuals contribute small amounts... they add up to fund a creative project, a business or a cause... facilitated by online, digital platforms6
  7. 7. 7REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDING4 differentmodels ofcrowdfunding
  8. 8. 8REWARDSContribution > $X,gets you a coolreward from thestartupDONATIONEQUITY(INVESTMENT)CROWDLENDING
  9. 9. 9REWARDSDONATION“give andget nothingin return butfeelgood”EQUITY(INVESTMENT)CROWDLENDINGPeer-2-peer lendingfor low or nointerest
  10. 10. 10REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDING
  11. 11. 11REWARDS DONATIONEQUITY(INVESTMENT)crowd earns equity,debt, or a revenueshare for theircontributions(pending JOBS act)CROWDLENDING
  12. 12. 12Over the years,models haveoverlapped.
  13. 13. 13REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDING
  14. 14. 14REWARDS DONATIONEQUITY(INVESTMENT)CROWDLENDINGNote:Sites selected for discussion are those with highest traffic in each category according to Alexa (Q1 2013),Kiva traffic from multiple Kiva domains incl Kiva.org and Kiva.org
  15. 15. More and morecrowd-funding variantsevery year...15
  16. 16. 16This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tips for yourCampaign:How Not toFail
  17. 17. 17Q1:What kind ofproject/ bizis it?
  18. 18. 18Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearrevenueInnovative“sexy” idea -uncertainsuccessNot “sexy”but clearrevenueNo plan yet,just bet onME
  19. 19. Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” idea -uncertainrev$, date ofcompletionNot “sexy”but clear rev$, just needscapitalNo plan yet,just bet onME!
  20. 20. Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” idea -uncertainrev$, date ofcompletionNot “sexy”but clear rev$, just needscapitalNo plan yet,just bet onME!Q2:Belongs to these 13 categories:Art, Comics, Dance, Design,Fashion, Film, Food, Games,Music, Photography, Publishing,Technology, or Theatre?Y
  21. 21. Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” idea -uncertainrev$, date ofcompletionNot “sexy”but clear rev$, just needscapitalNo plan yet,just bet onME!Q2:Belongs to these 13 categories:Art, Comics, Dance, Design,Fashion, Film, Food, Games,Music, Photography, Publishing,Technology, or Theatre?YN
  22. 22. 22Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” idea -uncertainrev$, date ofcompletionNot “sexy”but clear rev$, just needscapitalNo plan yet,just bet onME!Q2:Belongs to these 13 categories:Art, Comics, Dance, Design,Fashion, Film, Food, Games,Music, Photography, Publishing,Technology, or Theatre?YNQ3:Definitely requires loan$5,000-35,000 AND your CreditScore > 600Y
  23. 23. 23Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” idea -uncertainrev$, date ofcompletionNot “sexy”but clear rev$, just needscapitalNo plan yet,just bet onME!Q2:Belongs to these 13 categories:Art, Comics, Dance, Design,Fashion, Film, Food, Games,Music, Photography, Publishing,Technology, or Theatre?YNQ3:Definitely requires loan$5,000-35,000 AND your CreditScore > 600YN
  24. 24. 24Q1:What kind ofproject/ bizis it?non-profit,good causeInnovative“sexy” ideawith clearneed, end,and revenueInnovative“sexy” idea -uncertainrev$, date ofcompletionNot “sexy”but clear rev$, just needscapitalNo plan yet,just bet onME!Q2:Belongs to these 13 categories:Art, Comics, Dance, Design,Fashion, Film, Food, Games,Music, Photography, Publishing,Technology, or Theatre?YNQ3:Definitely requires loan$5,000-35,000 AND your CreditScore > 600YN
  25. 25. WHATCONTRIBUTORSRECEIVEDONATION + REWARD(pre-selling goods,pre-determined rewards)DONATION + REWARD(pre-selling goods,pre-determined rewards)DONATION + REWARD(pre-selling goods,pre-determined rewards)INVESTMENT(equity, share ofrevenue)INVESTMENT(equity, share ofrevenue)NON-PROFIT(purely emotional/feel-good)NON-PROFIT(purely emotional/feel-good)Main playersKickstarter Indiegogo rockethub Upstart Prosper Kiva Zip Causes.comSize / Volume(ave $ fundraising p/day)$1.04mil n/a n/a n/a $330K$500k (all Kiva)$24k (Zip only) n/aFailure to meetGoal %56%90%on projects >$1000N/anon goal-oriented siteVaries -est 50%0.5%non goal-oriented siteFundraising limits(Whether donation/Loan)No limit No limit No limitVaries: $100 upto$20,000 forexperienceddepends oncredit score,$35,000 max1st loan$5000No limitPlatform Cost($paid directly to platform)5%4% if goal met9% if goal notmet4% if goal met8% if goal notmet3%Fees vary byProsper rating0.5%-5%FREENo interestNo commissionFREENo interestNo commissionOther expenses(not paid to site but incurredbased on platform’s model)Video +Reward + 3-5%credit cardprocessingVideo +Reward + 3-5%credit cardprocessingVideo +Reward + 4%credit cardprocessing(only latefees)Interest ratevaries:9%-35% APRFREEPaypal-Kivatransactions free4.75% creditcardprocessingFinancialCriteria / eligibilityNo No Nomin FICOscore > 640min creditscore > 600CharacterendorsementNoType ofbusiness’restrictionsArt, comics,dance, design,fashion, film,food, video,games, photo,publishing, tech,theatreNoNot only arts, butlargest crowd-funder forScience andAcademicprojectsCollegeGradsNo NoGuideStar-verified andactive 501(c)(3)nonprofitsQuick overview of numbers (size, fees, costs, limits, etc)
  26. 26. “So now I’ve chosen themost suitable crowdfundingsite or sites for myself”...What’s Next?26
  27. 27. 27Rising abovethe Noiseof all crowdfundingcampaigns fail.71.3%
  28. 28. 28This Webinar.....“101”4 Differentmodels ofcrowdfunding“OMG!”“So many sites...how do I choosethe right one formy biz?”Tips for yourCampaign:How Not toFail
  29. 29. 29Don’t forget to include the crowd-funding platformsuccess and/or failure fees, any credit card fees (usually2-3%), all reward costs and reward delivery costs.BUDGETFind rewards that are exclusive but not costly - name anice cream flavor after donors who give >$200, free farmtours, studio tours or concert passes, collectables, etc.COOLrewardsCRAFTyour story w/TLCBUDGET*BUDGETWatch videos, look at photos or read stories that do well.Learn. Write your own story. Improve it. Run it bypeople who don’t know you well. Improve it again.HEARTMarketing with no marketing budget is always aboutsocial media heart & hustle. Ask friends to share yourcampaign. Ask influentials to retweet you/email introyou to others. The more people you ask, the luckier youget in social media.&HUSTLE
  30. 30. &• Syracuse IVMF a Kiva Zip trustee since Nov 2012• Endorsed 3 EBV graduates based on business plan, financial situation & character• Because they are ʻvouched forʼ qualify for a <$5000 zero interest zero fee crowdfunded loan• funded by a base of 1.3mil registered Kiva lenders from around the world• Gerald, Jamie & Donnie took between 1-45 days to fund their loan (half the ave time)30$2,000 loan to purchase anew computer & new partsand labor for my servicetruck.GERALDYoung Gs BBQ Sauce$5,000 loan to installautomated wateringsystems which reducelabor costsJAMIEFloral Greenhouses$5000 loan buy a computer andequipment, cover legal & patentsfees, recruit our top tierengineering team and present formajor partnershipsDONNIE & CLOVEASphere Force Innovation(renewable energy solutions)
  31. 31. What the endorsement looks like (Gerald’s example)31
  32. 32. Questions?- about crowdfunding options in general- about Kiva Zip specifically32
  33. 33. 331) Broad search:what different crowd-funding sites exist?2) Compare & Select:Of the larger sites serving my type of biz, whichone(s) suit my needs (size, speed)& resources best3)Free Tips:How to activate thecrowd and minimizewasting time andmoney?http://www.rockethub.com/educationRockethub Success School

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