Business Questions

[ysabetwordsmith.livejournal.com]

This is an opportunity for folks to discuss the business aspects of crowdfunding.  What would you like to know about cyberfunded creativity and how it works?  Do you want advice on a current or planned project?  Ask your questions in a comment on this post. 

Comments

[untrueo.livejournal.com]

I have only read a bit about crowd funding, so bare with me. How can crowd funding benefit a small business? When do you as a business owner execute a campaign? How do you know when to pull out? Are there any case studies?

Okay...

[ysabetwordsmith.livejournal.com]

>>I have only read a bit about crowd funding, so bare with me.<<

I recommend that you start with the Memories file of this community, or the Crowdfunding (http://penultimateproductions.weebly.com/crowdfunding.html) section on my website, both of which have extensive resources on what crowdfunding is and how it works.

>>How can crowd funding benefit a small business?<<

Bear in mind that crowdfunding for a small business is a bit different than the cyberfunded creativity usually practiced in this community. (Think of it as the difference between liberal arts and business.) That said, crowdfunding is a good way to raise money for launching a business that a regular bank won't back -- which is darn near everything in this economy. It's also ideal for funding improvements such as a new computer (Hunt Press did this) or a car for traveling to events (which I've seen recently).

>>When do you as a business owner execute a campaign?<<

When you know exactly what you need and what it will cost, and either you can't get the money elsewhere or you just plain prefer this business model. Successful crowdfunding ventures have a detailed business plan and budget.

>>How do you know when to pull out?<<

When you determine that the effort is not worth what you're getting out of it. Note that this varies greatly from person to person. I'm not going to quit supporting Aether Dancer (http://www.indiegogo.com/AetherDancerProject) just because they're a parsec away from meeting their goal. I am so disgusted by Hollywood dreck that I would rather support good entertainment that may never see the light of screen, than buy most of the stuff that already exists. And who knows, maybe the damn pig WILL fly.

>>Are there any case studies?<<

A few. Here your best bet is to dig through this community's archives. A number of folks have posted analyses of their projects, or aspects of a project, or links to articles about crowdfunding data from the hub sites. The business model is relatively new, and has only caught serious attention in the last year or two, so not much has been written about it yet.