Fundraising has been a part of the financial industry for the longest time because people have been referring to it for various purposes. For those that just needs a little push because of an unexpected financial problem, they refer to fundraising as their way of asking their family and friends for some funds to get them going.
There are also some business startups who are using crowdfunding, which is an efficient online version of raising funds. Apart from family and friends, they get to use technology to be able to reach more people and present their business ideas. Taking this route will only have those raising funds depend on asking for small amounts from a big number of people.
But Kanye West, one of the most prominent personalities of this time has a different route – ask a rich guy for funding. It is similar to approaching a bank or an investors but the way he did it leaves a few questions around his tactic. Huffingtonpost.com mentioned that the artist in $53 million under and that might be the reason why he is reaching out to the Facebook founder.
West recently took to Twitter to publicly call on Mark Zuckerberg to invest $1 billion into his “ideas.” This brought the Twitter space into a frenzy as people started to see how the tech giant would respond. As of present, the Facebook CEO has not responded to the request and it seems that this deal will not come into fruition.
There are a lot of reasons how debt can be pulling you down and one of the knee jerk reactions people have is to quickly ask other people to help them out. There is nothing wrong with this but you need to carefully think about your strategy when asking other people for funds. It is very rare that people would jump quickly on a fundraising campaign and even then, there are factors surrounding that project which made people want to donate.
Fundraising lessons from West
If you are looking to start a fundraising campaign, here are a few lessons you would be able to pick with how Kanye West did it.
- You need to be specific with your request. If you are fundraising, you need to make sure that you make it easy for the people you are asking money for to understand the need and if possible, the opportunity. “What’s in it for me?” is a phrase you need to answer for your investors. You cannot simply ask people for money without being specific with the use and how you even came up with the amount. Of course, it is not something you lay on all out in the first time around but you need to be ready and prepared with it.
- You need to reach out to the right people. If you want to reach out to a specific person or a group of people, you need to do your research on how to reach out to them. You do not simply put a message out and hope they see it or even react to it. At the end of the day, you are the one that needs them so the effort must come from your camp. It is not enough to just send out a message in a bottle hoping investors get to find it, look for links or people who can introduce you and make your case.
- You need to be mindful of competitors. During the holidays, you might had a hard time choosing the best credit card for shopping because competition is fierce in the finance industry that card lenders are trying to lure in users with perks and benefits. After all it is a business model where success would largely depend on the number of customers. Kanye must have realized that he was asking money from the Facebook founder using the platform of a competitor which is Twitter. You need to be aware of the competitive landscape and see how you can traverse it to get through to your goal.
- You need to have a backup plan. If your target investors do not give you money, what is next? This is where a backup plan comes into the picture as underscored by a recent article in Huffingtonpost.com. You cannot put all your hopes in one person because although the payoff could be big, the risk could also sideline you and your business ideas. Have a plan in place on how you can proceed with other sources of investment from hour fundraising campaign.
Tips to make fundraising a success
Here are a few more tips you might want to look into when you are trying to run a successful campaign whether with just your family and friends or if it includes other individuals as well.
- Be mindful of how you use money. Art is not an excuse to squander of millions of dollars and force people to appreciate it. If you are asking for funds, be prepared to use it wisely. The better you utilize the funds, the easier it would be to put together a report for your investors to appreciate. If they see how professional you are with managing the money, it is easier to ask them again in the future.
- Surround yourself with the right people. It is important to get financial inspiration when you are taking on a fundraising campaign and one way you can do that is to surround yourself with people that you trust and can actually look up to. These can be friends whom you know are hard workers and can be trusted with the money you get from your project. You might also want to reach out to your college professor or anyone in your industry that can give you important pieces of advice on how you can improve on your money raising campaign.
- Learn from your past mistakes. FinancialTimes.com explains how important it is to learn from past mistakes which is how Europe should approach its financial problems. You can do the same with your project and see where you struggled in the past to be able to make the necessary approach and veer away from problems you already had in the past.
Raising money is never an easy task but a rewarding one especially if you are trying to get a business idea off the ground and running. This is one of the struggles startups usually face early in the game and they would normally troop to their bank to get out a loan or ask other people to join in and support their campaign.
The fundraising idea of Kanye West leaves much to be desired when you look at how he just posted a message calling out the Facebook CEO to put money into his ideas. It can be a marketing strategy for him to be noticed but there are some people who will point out that he is already a celebrity to begin with and can do away with controversy and just manage his popularity status. With the way he is trying to get Mark Zuckerberg to put in money into his project, it is not surprising if it does not yield any positive response.