Startup crowdfunding – Why You Need A Business Plan.
Your business might be perfect for crowdfunding, but if you want a solid investment, you’ll need a solid business plan for crowdfunding. A business plan is a statement of your business goals, how you’ll achieve them and how you expect your business to grow. It should include all the small details that investors need to know to feel safe in their investment.
When crowdfunding for a business startup, you should ensure that your business plan is clear and concise for everyone to understand. The reason for this is that not everyone on the crowdfunding platforms is a high-end investor, as the platforms allow individuals to contribute any amount to a campaign, from as little as £10 to £100,000.
So, what needs to be on your plan?
Startup Crowdfunding – Executive summary:
An executive summary is a short synopsis of your entire business plan that comes at the very start (but should be the last thing you write). It gives the reader an overview of your intentions, abilities and research to prime them for the heavier information to follow. It allows them to become familiar with your business and understand the key points of your organisation.
The executive summary is often known as the most important part of a business plan. The reason for this is that it determines whether or not a potential investor is going to be interested in your business, and will want to read the rest of your plan.
Startup Crowdfunding – Mission Statement:
The mission statement is a declaration of your business’s purpose. In clear, detailed terms, explain what you want to achieve and why you’re the best person to achieve it, portraying the passions and talents that make your success inevitable. As much as possible, articulate your goals and your plans to grow the business over time. A mission statement is your announcement to the world about why your company exists.
Startup Crowdfunding – Market Research:
Here, you’ll explain how big your market is, whether there’s a gap big enough for your product, and how you’ll fill it. Explain who your audience is and how you’ll reach them, providing evidence that they want your product. Identify your key competitors and prove that your business has enough advantages to outshine them.
Startup Crowdfunding – SWOT Analysis/ Competitor Research:
Identify your SWOT- Your Strengths, Weaknesses, Opportunities and Threats. This’ll show that you have a deep understanding of the playing field. It’ll also show that you’re capable of self-reflection, and adaptation to changes in the short, mid and long-term future. In a competitive environment, you must be deeply aware of your weaknesses in order to improve.
Startup Crowdfunding – Financials:
Here’s where you need to be super specific. Itemise your future goals in terms of income and expenditure. The more detailed you make it, the better your plan will be, and the more professional you’ll look to your investors. Say how much has already been invested and how you plan on using your backers’ investment as efficiently as possible. Remember- don’t leave it all to brainwork. People are often surprised that the numbers, when written down, don’t match up with their expectations.
Crowdfunding is booming, and its crowds grow larger by the minute. Admittedly, with an average of 325 crowdfunding campaigns going live every day, a great business plan and a great product won’t be enough to get noticed. A lot of other pieces need to be in place- a great pitch video, a healthy stream of communication with potential backers, a decent mailing list, effective PR outreach, and more.
Free Tool – Startup Crowdfunding Business Plan Template
Claim your free Business Plan Template here
Do you need advice about your startup crowdfunding business plan?
We can help. Drop The Crowdfunding Studio are proud partners of Crowdcube and Indiegogo. We assist ambitious businesses in communicating their ideas, products and services with outstanding crowdfunding video production, campaign design, crowdfunding marketing and crowdfunding PR.
To learn more about us and our services, visit our website: drop.studio
Or book a free phone workshop today and ask us anything, like how to create a successful crowdfunding campaign or how to accelerate your business from zero to fully funded.
Want to know why a financial forecast is vital to your campaign? See our next article