How to Start Your Business on the Cheap--with Help From the Crowd
If you need help turning your brilliant idea for a product or service into a functioning business--and get that help for a pittance--look to the Internet. With more than two billion people online, a lot of talent is out there, and many smart and artistic people are willing to help you make your vision into a reality, often at a surprisingly low cost.
Fri, February 17, 2012
PC World — If you need help turning your brilliant idea for a product or service into a functioning business--and get that help for a pittance--look to the Internet. With more than two billion people online, a lot of talent is out there, and many smart and artistic people are willing to help you make your vision into a reality, often at a surprisingly low cost.
But how do you effectively communicate your needs to the hive mind and realize your dream? That's where crowdsourcing websites come in. Most of these virtual marketplaces are purpose-built for funding ideas or creating graphic designs. Others are full of eager Internet users willing to do all sorts of creative and crazy things for as little as $5.
Not all crowdsourcing websites are based on the same model: On some of them, you submit a project and others bid for your money, while on others you submit an idea and pitch it to others to generate financial backers for it.
Here's a guide to four of the best crowdsourcing websites, each with its own unique highlights and advantages.
Use Kickstarter to Fund Your Project
Kickstarter is a crowdfunding website: You come up with an idea, write a persuasive pitch, and post it online. If it's good, the public (hopefully) buys in and pledges money to make it a reality. Every Kickstarter project has a pledge minimum, and if the project doesn't earn the minimum amount within the time allotted, no money is collected. Even if your pitch succeeds, you don't get the entire amount: Kickstarter takes a 5 percent cut, and Amazon (the payment processor) takes 3 to 5 percent.
Of course, having an amazing idea isn't enough; only 46 percent of all Kickstarter projects meet their funding goal, so it's important to maximize your project's chances of success by following these simple steps:
- Come up with an awesome idea: This sounds obvious, but it bears repeating: Pitch something awesome. Your idea doesn't need to be revolutionary or crazy in order to succeed; it can be as simple as a better iPhone dock.
- Take advantage of your community: Spread the word to your friends and fans, especially if you're an artist or creative type. Chances are you already have a bunch of social media accounts, so use them.
- Have a business plan: Figure out exactly how much money you'll need, and how you will use it. Make it clear to your backers exactly how you plan to use their money, and don't ask for more than you really need; if your idea is good, your fans can always choose to pledge more.
- Offer rewards: Most successful Kickstarter projects reward donors with products or services at each successive donation level, such as a signed poster (for an artist) or a discount for the final product. The rewards typically become more desirable as the donation amount increases, but if you're concerned about depleting your product inventory (or your hand cramping up from signing so many posters) you can also create "limited" reward levels that provide rewards only for a predetermined number of backers.
- Create a memorable video: The lion's share of successful Kickstarter projects have impressive or memorable videos, ranging from the humorous to the proof of concept. Which leads me to my next point:
- Have something to show: If you are trying to bring a product to market, make sure that you at least have a working prototype to show off on your Kickstarter page.
