Career Testing
Career Testing
Career Testing
ENTREPRENEURSHIP / AUG. 21, 2014
version 3, draft 3

How to Fund Your Startup Idea on GoFundMe

Crowd and fundraising sites are everywhere now. It’s the perfect marriage of entrepreneurship and the reach potential of the internet.

GoFundMe, launched in 2010, boasts some impressive numbers:

  •          Over $400 million raised
  •          5-minute customer support
  •          Over $1 million raised per day
  •          “The World’s #1 Fundraising Website”

Featured on Forbes, Time, Mashable, CNN, Fast Company, and The New York Times, it’s no fly-by-night operation. But can it help you and your idea?

Yes. Yes it can.

A Bit of Background

GoFundMe is a crowd or fundraising site dedicated to connecting people (who need money) with, well, other people (who are willing to donate). It bills itself as a forum for raising money to pay for charity purposes and personal expenses like education, medical, funerals, sports team costs, and so forth. Most of their success stories revolve around those categories.

That said, anyone can create a campaign on the site, and for that reason, it should be on your radar for your startup idea. Startup ideas that support a worthy cause, or charitable organization, or seek to help others in some way will likely perform better than those looking to create, say, the next Angry Birds, but you never know...

As Easy As 1-2-3-4

GoFundMe lists four easy steps to go from zero to fully funded. Sign up for a free account with either an email address or your Facebook account (which is not a requirement, but it HIGHLY recommended, as it makes sharing your campaign that much easier. And please note that you must connect a Facebook account if you want your campaign listed in the GoFundMe directory). Once you’re sign up and in, you’re ready to launch.

Step 1: Create a Campaign

Your campaign page is simple by design. It includes only what it needs to explain itself and your goals. Enter the details for:

  •          Goal Amount (how much you need to raise) and Currency
  •          Page Title (clearly explain what it is you need the money for. Be specific)
  •          Your postal/zip code
  •          Your message to people (go into details here, explicitly explaining what you’re going to do with the money, and how it will make the world a better place)
  •          You can customize the color scheme and insert a photo or video (always a good idea if you have the technical chops to create one. People are visual creatures!) as well.
  •          Optional features at the bottom include Reward Levels (offer rewards - both real and intangible - for certain donation amounts. Shares in your new multi-million dollar company perhaps?) and Wish List (the various components and individual costs involved in your campaign).

Step 2: Share Your Campaign

Next, you need to get it out “there”. GoFundMe makes this ridiculously easy with built-in connections to Facebook, Twitter, and email. But don’t feel like you’re limited to just those three options...the more you share, the more people you’ll potentially reach. And the more you reach, the greater the pool of donors. Share it on your social media profiles, ask friends and family to share it on theirs, and send it to other blogs, websites, and platforms that are connected in some way with your idea or industry and ask them to share the campaign as well. The internet offers unparalleled potential, but you have to work a bit for it. Don’t just sit back after posting to one profile and wait for the money to come rolling in.

Step 3: Accept and Receive Donations

Anyone can donate to your campaign. They just need to see it. Donors can pay by debit or credit card, and they don’t pay anything other than their donation amount (you, however, will pay...more on that later). Every time someone sends money to your campaign, you’ll be notified by email (and remember to send a quick note of thanks!).

Once you have some money, you can request payment. You don’t need to wait until you reach the campaign goal...reaching the stated goal is not required at all (unlike some other fundraising sites that pay out ONLY if you reach it). You can create an “All or Nothing” campaign if you so choose. Send a payment request and receive your funds by either bank transfer or check. At any time, and withdrawals do not affect your campaign progress meter in any way.

Step 4: Enjoy the Results (and Update as Needed)

Your campaign dashboard allows you to make changes and updates, and send thank you notes to donors. It lists all donors by name and amount, with a convenient “send an email” icon right beside their name. So no excuses...send a note to everyone.

Use the dashboard to update your campaign and share news about your idea. How is it progressing? Has anything changed? Do you have a new/different/unique approach to some previous problem or obstacle? Keep your friends and donors in the loop every step of the way.

The Business Side

Your donors pay nothing to donate, but you will. GoFundMe collects a flat rate of 5% from each donation received (to cover their hosting and maintenance costs), and WePay collects an additional 2.9% + $0.30 for handling the transaction, for a grand total of 7.9% and $0.30 per donation (in Canada and the US). That figure is the same for countries outside North America, although the transaction is handled by PayPal instead. The United Kingdom is slightly different - GoFundMe collects 5%, and Stripe takes 2.4% + 20p, for a total of only 7.4% + 20p per donation.

You can even keep tabs on your campaign on the go. GoFundMe offers both Android and iOS mobile apps. Check out Five Steps to a Successful Campaign [302 from http://support.gofundme.com/entries/22577232-5-steps-to-a-successful-campaign] for even more advice.

That’s it, that’s all. You’re created your first GoFundMe campaign in support of your startup idea, and with a little luck, you’ll have more than what you need faster than you ever thought possible. It’s not a guaranteed method, but it has worked for millions, and you could be the next big success story. Just take the time to create a detailed and visual campaign, offer some decent reward options, and share the living daylights out of it.

Crowdfunding is changing the way we raise money. Don’t let the opportunity pass you by.

Image Source: GoFundMe

 

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