Essensys - Coworking Space Management Software

Tips

Crowdfunding: No funding without a crowd

The crowdfunding market quadrupled last year alone, but doesn't work without crowd. How to build a project based community? Le-Mentzel (right below), explaines how he successfully funded his project. (Image: Betahaus, edited)

Nexudus - The white-lable management system for coworking spaces
CU ASIA 2019
Interested in stats on coworking? Then come this way: CoworkingStats.Com
Coworking Visa
The Global Coworking Survey Newsletter
The Major Coworking Events 2018
The crowdfunding market quadrupled last year alone, where ordinary people found other ordinary people to finance their projects. There is an art to the crowdfunding venture, and as many have already noted, it is not always simple to master. As the name suggests, without a crowd, there is no funding. Van Bo Le Mentzel, who crowdfunded a book on DIY furniture, spoke at re:publica about his experience. His success is here summarised in seven steps.

Six years ago, the first crowdfunding platform launched with SellaBand as a response to the music industry crisis. It was actually only directed towards musicians, but it revolutionized the world of finance. Several years later during the financial crisis, Kickstarter and Indigogo popularized the concept.

Today, more than two hundred Crowdfunding platforms exist worldwide. While more crowdfunding platforms means a bigger pools of people to pitch a project to, it also means a lot more competition. How exactly does one attract a crowd.

Van Bo Le-Menztel succeeded in doing so, and this month, published a book on DIY furniture. He shared his strategy during Berlin's re:publica conference to help hopefuls like himself realise their dreams. These same principles too can be applied to building a community in a coworking space, since their most important feature is their crowd.

Base

Build a set of values as the base for your project. The project itself is not enough to inspire a crowd. There are thousands of ideas, so why support yours over someone elses? "The reason why people are excited about a project is not because the blueprint is so hot, but rather the basis on which it is built." The foundation on which Le-Mentzel’s project was built, for example, was "designing instead of consuming; build more, buy less." Put your idea in a context that appeals to people and communicate values with which they can identify.

Chase

“Why are you doing that? What’s your personal drive?” Tell people your story. Van Bo wanted to impress his girl friend. Today, they’re married. And Van Bo Le-Mentzel is no longer called Le Van Bo. There are limitless things which can motivate people. Open up to them and talk to them about why you’re doing what you’re doing.

Face

Find a catchy name for your project, give it a face. Van Bo dubbed his furniture "Hartz IV furniture" (Hartz IV stands for a German social security program which means you're out of money) and not just “DIY furniture”. The latter term is well worn and over-used, even if it was essentially what his project was. But by calling it “Hartz IV”, he reduced the project to its core message: owning good furniture for less.

Place

People better identify themselves with a project if they link to a place. Le-Mentzel chose a coworking space in Berlin - Betahaus - to write his book. Betahaus was the place where his project came to life. For you, it might be another physical location. It might also be a page on the web. The key is, it doesn’t matter where it is, as long as it’s central and visible. Being in a place too can help you build relationships with others, who can, if sufficiently impressed, act as your advocates - much like the common benefits of coworking for a freelancer or startup.

Space

If you can convince people who support you, allow them to be part of your idea. You lead a project, but do not pay the people who support you. It is the opposite. They pay you, so don't be bossy. Allow your supporters to contribute their own ideas. And take them seriously.

Trace

Be frank with people about where your money goes. Allow your supporters to follow your trail. Transparency is the keyword. Admit errors if they occur and by no means try to cover them up - they will come to light sooner or later. "Be the first to disclose the error," said Van Bo, and learn from others. Openly admitting fault helps you to drive a project, with others, in the right direction.

Count the days

Don’t develop your project within a timeframe of all eternity and with plans of world domination. The bigger a plan gets, the longer and more difficult it is to explain. Forget your branches in Tel Aviv and Shanghai, reduce your project to its core and choose a feasible schedule. A project is also a ‘project’ because it is limited.

Once you are successful with the first project iteration, you can develop it further. Having an open-ended schedule is also more difficult for your own progress. (Feasible) time limits will strengthen your motivation and your supporters' participation in your ideas; and only after their participation can implementation begin.

In addition, use the building-block approach. The quicker you are to implement steps of a project, the more visible your progress is, and the easier it is to win supporters for future developments of your initial proposal.

Some more advice Slava from Indigogo also spoke at re:publica. He represented the "other side", since he manages a crowdfunding platform. He shared some advise which was quite similar to Le Mentzel's, but as owner of crowdfunding platform, he added some interesting details.

An average, 40% of an Indigogo project is supported by your inner circle. Another big part comes from friends of friends. Only 25% are completely unknown to you, people with whom you have no connection, not even through friends or acquaintances.

This is, however, just the average. The smaller the project, the more likely it is to be funded by friends and aquatainces. (This doesn't mean that any given small project will be supported by them, the probability is simply higher compared to strangers.)

The more money you need, the more strangers need to support you. Slava also recommended updating your supporters at least every four days. There is a significant difference than if you were to do so every 20 days, for example. In effect, the more often your crowd hears from you, the better, as long as you don't cross the line into spam.

:::

A new video was uploaded by Le Van Bo about his tips: Crowdbuilding - 7 steps in 7 minutes

comments powered by Disqus
Coworking Resources from A to Z
Profitability of Coworking Spaces