Why crowdfunding is not easy money but hard work

In the entrepreneurial community, there’s lots of talk at networking events, in coffee shops and at pitch sessions about crowdfunding - and, there’s no doubt it has boomed over the past few years. In fact the crowdfunding industry was worth over £3.2bn in 2015. Crowdfunding platforms such as Kickstarter and Indiegogo are now central to many startup business plans. The ability to pitch a business plan online and receive funding, in return for either equity or rewards, is an enticing idea for entrepreneurs that need investment - but crowdfunding is not easy money - it’s actually hard work. There are significant costs and responsibilities involved and success is far from guaranteed. Research and preparation are critical, and pitches need to be perfected before they go live online. Choosing the right crowdfunding platform is also key, as is ensuring that a third of your investors are already lined up from a pool of friends, family and investors; a third coming from the platform; and the balance from your customer and partner network. So, here are 5 tips for ensuring greater success in crowdfunding: Do your research carefully and identify the right crowdfunding platform for you; Start identifying potential pools of investors; Create a powerful pitch proposition and get the message right; Be clear about what you want the funding for; and Do the hard leg-work with potential investors before you launch your campaign.