Crowdfunding: How to Succeed & Why Many Have Failed

Launching a crowdfunding campaign seems attractive, but do not rush: it is essential to know how it works and how to succeed. You might regret your mistakes, especially if you strongly believed in your project. If you are curious to see what kinds of products are successfully funded in Japan and what can be the results, check out our article here.

Attract Supporters

To reach your goal, you want to attract the maximum of supporters, or to attract big investors (‘angel investors’): it is important to know what they are looking for. But first, you need to find a catchy title and describe your project in detail. If possible or necessary, add scientific explanations which will reassure the customers and give a certain authority to your project. You should also add images (and videos) of your product from all angles, with a description.

Second, supporters think about the returns they will get. It is a good idea to let them choose between several options, so that you can attract supporters seeking for different types of returns. Also, make sure that backers will receive what they wanted and reassure them about it.

Then, you will need to advertise your project and spread it. Communication is the key, use your social media channels or create new ones. Twitter, Facebook, even Instagram if it is appropriate. Post regularly and answer your followers’ questions. Ask your friends, colleagues, etc. if they can share your posts and help find more supporters. It will be easier to grab users’ attention with videos, images and a blog. A study has shown that videos are becoming more and more effective on social media.

Remember, even if the time goes by and your goal is still not reached, it will not necessarily fail. Some ‘angels’ can make it revive: it is never too late, even a week before the deadline. In fact, almost 90% of the projects whose goal is not reached after two thirds of the application period are successful, thanks to ‘angels’ and / or late applicants. 40% of projects which seemed to be a complete failure are still successful at the end. So do not give up and keep advertising your campaign!

Question of Credibility

Another important element is to get the supporters to trust you. If you promise life-changing goods or services which are impossible for you to make, your project will fail and you will have some problems later. Another point is not to ask for an incredible amount of money: the higher the goal, the greater the risk of failure. You can still add stretch goals (additional goals if the main goal is exceeded) which you know people will want, or which people have asked for. You can lose credibility if your goal is too high and cannot be reached. You can also explain the cost of a product, which will make you look more reliable.

But the most important thing is to distribute returns at the end of the campaign. If you forget, you will lose credibility and it will be more difficult to be supported for your next campaign. Especially in Japan, where people buy what is familiar to them and from a reliable company.

If you know that your goal will not be reached or if you discover that your project is impossible, stopping your campaign halfway is a mistake. If we except the fact that your goal can be reached a few days before the deadline, it is not pleasant for the supporters. In addition to that, your ideas can be stolen, and it takes time to deposit funds. It is better to wait until the end of the campaign.

The Roots of the Most Common Failures

  • The project did not spread (not good advertising campaign nor PR method)
  • The project stopped halfway (it is important to check if it is legal and technically possible)
  • The goal was too high
  • The company went bankrupt (the products were not delivered)

Do not forget the importance of communication and that your supporters believe in your project like you do. It is never too late, so if you are ready and sure of what you have to offer, launch your campaign. You can also check out our other articles to know more about it, like our Top Three Crowdfunding Platforms in Japan.

And if you need help with your project, let’s get in touch! Whether you need a strategy or assistance with your new innovative product, we provide value for your new product launch in Japanese Market. We offer Crowdfunding Support and Digital Marketing Services, all under one roof. You can contact us here!