London-based mental health platform Tala Thrive’s crowdfunding campaign was overfunded within two weeks of launching. The platform provides therapists and coaches with an understanding of underrepresented cultures and religions in multiple languages.
“Although most successful crowdfunding campaigns are for physical products and hardware — or are much later stage with significant revenue — we had hundreds of early adopters on our waitlist with no paid marketing and wanted to capitalise on the support,” says Sonia Kaurah, Tala Thrive’s founder and CEO.
Here she shares her top tips for running a successful crowdfunding campaign.
Understand why you’re crowdfunding.
Weigh up all of your different funding options before you dive in. With VC, for example, you may only have a limited number of people to reach out to for support in your early days — the couple of funds and investors that write you cheques — whereas, with crowdfunding, you can ask all your backers for help.
Another reason may be your network. VCs work on warm introductions — if you’re new to the scene, this can be difficult and/or time consuming. With crowdfunding, you have the option of getting your early adopters and believers to buy in and you can accept a lot more smaller cheques. The side effect of getting the crowd to buy in proves to VCs that there’s demand and a belief in your product.
Tell your story.
Your product needs to resonate with people. We’re not a physical product — we can’t be sexy and cool — so we had to sell the very personal need we address. You need to get people to feel emotionally attached to what you do and trust you. Build a narrative:
- What is the problem?
- Why is it important to solve?
- How are you solving it?
- Why are you the people to do it?
- What does your investment mean?
Wait for traction.
If you don’t succeed in reaching your crowdfunding goal, it will be publicly known, so you want to minimise risks. Early-stage startups don’t traditionally do well on crowdfunding platforms. Wait until you have data and learnings you can share like number of customers or revenue.
Prepare for a lot of due diligence work on your crowdfund.
Having to complete due diligence work for a crowdfunding platform is incredibly intense and full on. With the platform Seedrs, due diligence was as comprehensive as with any VC — maybe even more so. It included things like providing proof of our customer waitlist, showing our numbers stack up, and show proof of partnerships being confirmed.
Get people to pre register their interest.
You want to have as many people committed as possible before you open it up publicly so your numbers look good and it convinces others to invest. When someone pre-registers, get them to state an investment range they’d like to commit to funding you. You have to reach out to a lot of people to get these numbers up: contact all of your friends, family, peers, ex-colleagues and, of course, your most loyal customers. This group of people also get priority to invest before the campaign opens to the wider public.
Create a social plan around your crowdfunding campaign.
Check out what previous successful crowdfunding campaigns did. Learn from their social posts, cadence and storytelling. Then:
- Plan and record your videos — like the overview video that tells your company story and vision, and a product demo video.
- Put together a marketing plan, including all your social posts. You want these all scheduled before launching the pre-registration phase of your campaign.
- Get your first investors to post about why they invested in you. Create example copy they can tailor for themselves. Make it easy for people to share your campaign.
- Get every team member to share the campaign on socials and in WhatsApp groups they’re part of. Again, write an example copy.
- Send constant updates to anyone who pre-registered their interest.
On the subject of... crowdfunding
- The EU forced Apple to let users download apps from other sources. Now, developers can use crowdfunding platforms to support them in building their apps.
- Why is crowdfunding trending in Europe?
- Crowdfunding rewards. Not all investors are willing to wait for an exit to get returns, so incentivising them with rewards can help sweeten the deal.
