Not surprisingly, one of the common hold-ups to launching a crowdsourced campaign is the funding. As an expert Challenge Designer with HeroX, I wanted to take some time to write up four funding ideas and some funding best practices I’ve used with our clients in the past.
1. Budget Reallocation
Ask yourself what problem you are trying to solve. Is it a staffing or recruiting challenge? Is it a marketing opportunity for a potential re-brand, or to search for new content or ideas? Is it a research and development project that involves the future growth of your company? If you work for an organization or have a company of your own, often you will have an existing budget that you may be able to shift to a crowdsourcing project. This may first feel risky, but we assure you – the power of the crowd impresses us every day. Plus, why hire just one person when you could use the same funds (or less!) to hire the world? Click here to Start Your Project Today!
Traditional Venture Capital is used to 1) Raise Money to 2) Hire a Person to 3) Solve a Problem. In the future (and they have already!), investors will see the value in the Crowdsourcing Venture Capital model where entrepreneurs will 1) Raise Money to 2) Hire the WORLD to 3) Solve a Problem. It sounds simple. It is simple! Use your belief in crowdsourcing to open a conversation with your investors about helping you fund your next campaign.
Remember when Kickstarter and IndieGogo were brand new ideas? The whole notion of paying for something online far in advance of it (maybe) someday arriving at your front door was just incredible – laughable, to some. But now, popular crowdfunding sites have established credibility so contributors feel far more confident transferring money to the black abyss. Potential prizes you can offer donors are:
· Insiders view of the Challenge Guidelines before they are published
· Published name recognition on the Challenge Page
· Seat on your Judging Panel when the submissions come through
· Prototype of the winning solution
4. Intrinsic Motivation
While cash is a sexy motivation, it certainly is not the only one. Our most successful challenges are not the prizes with the largest cash offering. Instead, the most successful challenges are those with the largest impact on the world. Write an Overview for your challenge with a compelling reason that innovators should get involved. Answer the question: “How will this prize change the world?” Beyond an innovator's’ desire to contribute to the world, consider additional ways to intrinsically motivate the crowd. See my blog post, “Is a Prize Purse the Only Way to Incentivize?”, for more detailed information.
In summary, don’t be shy. Get after your crowdsourcing goals and start leveraging the crowd to help you solve your biggest problems today.