Home' Trinidad and Tobago Guardian : January 30th 2014 Contents BG18 COMMENTARY
BUSINESS GUARDIAN www.guardian.co.tt JANUARY 2014 • WEEK FIVE
In working with entrepreneurs and
startups around the region, by far the
main grievance aired is that they are
not enough options to raise money to
fund their startup dreams.
Many have been burned or even given up
entirely on the traditional banking avenues.
That does not leave many local alternatives
in a ripe with raw creative talent, but limited
in access to the capital and investment vehicles
needed to translate ideas into stainable busi-
nesses. But where local options are limited,
the Internet now provides a world of possibility
The rise of crowdfunding
The region s financial institutions are, typ-
ically, are not friendly to non-traditional, intan-
gible-asset-based undertakings, like technology
Crowdfunding allows individuals or com-
panies to raise money using online social media
tools to connect to those who are most inter-
ested in funding their projects. The concept
has been so successful that the crowdfunding
phenomenon has quickly moved from techie
buzzword to a mainstream fundraising model.
Kickstarter is one of the most referenced
crowdfunding platforms. However, there are
many other sites that perform similar func-
tions, such as Crowdtilt, Indiegogo and Rock-
etHub. A number of niche sites are also emerg-
ing like PubSlush, for aspiring authors, and
Appbackr, which targets aspiring app devel-
In less than five years, Kickstarter has
attracted more than five million contributors
pledging close to US$1 billion, funding more
than 55,000 individual projects. Rival fundrais-
ing platform Indiegogo boasts of a campaign
that single-handedly generated US$12 million
Numbers like these make crowdfunding an
attractive option for first-time entrepreneurs
and established businesses alike.
Crowdfunding platforms can vary based on
the types of projects presented, their fee struc-
ture, geographic coverage and even their
approach to treating with fund raised if you
don t meet your fund-raising goals. There is
also a growing number of private equity crowd-
funding websites including Crowdfunder and
CircleUp. Here, rather than simply make dona-
tions, investors can buy shares in start-ups.
So whether you re in Silicon Valley, California
or Port-of-Spain, Trinidad, looking to raise a
few thousand, or a few hundred thousand
dollars to bring your product to market, crowd-
sourcing can be a practical, viable option.
Six tips for crowdfunding
Succeeding at crowdfunding isn t automatic.
You can simply raising your virtual hand and
say send me your money. Crowdfunding
demands strategy, planning and well-coordi-
Here are six things to consider well before
launching your own crowdfunding campaign.
Solve a real problem. If you don t have a
good idea -- a solution to a real problem -
even the best crowdfunding campaign won t
succeed. You need to be able to communicate
how your idea is going to solve a real problem
people have. If you can t convey the essence
of your solution and how it works in a sentence
or two, you re not going to attract significant
interest from backers -- online or offline.
Do your homework. Successful crowdfunding
campaigns, typically 30 days long, can take
months of preparation. One key element of
your preparation work is building an audience
you can address once the project is published.
It helps to cultivate interest in your project or
idea by working the social media channels
such as Facebook, YouTube, LinkedIn and
Pitch perfect. A succinct presentation of
your idea through video, illustrations and text
is essential. Imagine yourself as a would-be
funder scrolling through projects, you need
to stand out and make an impact. Research
by Ethan Mollick, an assistant professor and
crowdfunding researcher at the Wharton
School of the University of Pennsylvania
showed a single spelling error reduces chances
of success by 13 per cent. In typical Internet
style, fortunately, there is a growing crowd-
funding support system of video producers,
editors and other consultants listed on sites,
like CrowdCrux, to turn to if you need help.
Set realistic targets. It is important not to
confuse how much money you would like to
raise with how much you need to fund your
project. Start by setting an amount high enough
to cover the costs of actually manufacturing
and delivering your product.
Even so, make sure your goal is one that
you are confident you can reach. The initial
data on funder responses confirm that people
love to back a winner. This means, for example,
that if set modest goals, blowing past it in the
early days of your campaign can actually help
attract additional backers.
Keep your options open. Crowdsourcing
done well can offer much more than money,
it can also be a validation of the viability of
your idea. You can use crowd-conveyed cred-
ibility to court more traditional sources of
financial backing, such as banks and venture
Give it your all. Very few people wake up
in the morning asking with a plant to give
over their hard-earned money to you on the
top of their to-do list. Running a crowdfunding
campaign is demanding. Your project will not
be discovered, nor will interest in it be main-
tained, unless you re prepared to put in time
and effort. But if you believe in your idea, that
shouldn t discourage you.
Crowdfunding is one of the best ways to
break free of the constraints of the limited
local financing and use a global community
to raise the funds you need to bring your idea
to life. Who knows, it s entirely possible that
your idea can be the next crowdfunding success
Bevil Wooding is the chief knowledge
officer of Congress WBN (www.congress-
wbn.org), a values-based, international charity
and the executive director of BrightPath
Foundation, a technology education non-
profit organisation. Reach him on Twitter
@bevilwooding or on facebook.com/bevil-
wooding or contact via e-mail at technol-
Crowdfunding your business dreams
6 tips to using the Internet to fund your startup idea
Feel the rhythm! Feel the rhyme! Get on up, it's crowd-
funded bobsled time!
Internet donors stepped in to save the day after word
went out that Jamaica's two-man bobsled team had qual-
ified, but didn't have money to go to Russia to compete.
Thousands of people contributed to online campaigns, in-
cluding one by Dogecoin, an online-only currency.
The Jamaican team of driver Winston Watts and brake-
man Marvin Dixon initially hoped to raise $80,000. Dona-
tions shot past that amount, and are now well past the
$180K mark, thanks to an outpouring of popular support
and media coverage of this sequel to the underdog story
that was the team's Winter Olympics debut at the 1988
The fan-favourite bobsledding team from the snow-less
Caribbean rose to global fame when the 1993 Disney feel-
good film, Cool Runnings, loosely chronicled their achieve-
ment and also popularised the team's slogan: "Feel the
rhythm! Feel the rhyme! Get on up, its bobsled time!"
As soon as the Internet got wind of a potential "Cool
Runnings" 2.0, supporters flooded PayPal, Crowdtilt, In-
diegogo and Reddit---using the crypto-currency Doge-
coin---to make donations.
This time around, the two-man team, ever the under-
dog, is benefiting from that enduring popularity. Their
campaign was funded in part by Dogecoin --- an online-
based crypto-currency similar to Bitcoin, but based on an
"doge" meme, in which shiba inus, a cute Japanese dog
breed, are shown in various settings. The Dogecoin effort
alone produced around $30,000 for the bobsled team,
after it was promoted in the currency's Reddit community
As the story spread, the International Olympic Commit-
tee committed to help pay the Jamaicans' travel costs.
Now through crowdfunding the team can cover its other
expenses, such as equipment and training time.
"I'm not a person who likes to quit," Watts said in an AP
report, "I put my heart into it and I know for a fact that
people are going to help this team."
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