Smart Ways To Figure How Much Money You Should Raise Via Crowdfunding

Posted on 4 August, 2015 by Team Wishberry

EC15 Let’s just get straight to the point. When you’re setting a goal budget for your crowdfunding campaign, here’s what you shouldn’t do: choose a budget at random, just because you can. And here’s what you should:

Be clear on what exactly you’re raising the money for

Sure, you’re making a film. But, do you need the money to make the entire film from scratch? Yeah, we didn’t think so either. Sit down and make a list of all the costs you actually need to cover- this could be anything, from hiring your favourite cinematographer to funding just the post-production of the film to managing the labour costs. The more specific you are, the easier the budgeting will be.

Consider extra costs

Do you plan to hire an agency to do your social media and PR? What about pitch video and rewards? Is your crowdfunding team made of people who are your friends and working for free or are you hiring a campaign management team? Have you considered paid advertising, offline events, etc.? How do you plan to fund all of this? Will this also be included in your crowdfunding campaign? If so, how much money should you really set aside for these things so that you reap maximum benefits and at the same time don’t overstretch your overall budget? Ideally, extra costs shouldn’t be included in the overall budget, but if you do (IF you’re raising a huge amount), this shouldn’t exceed 20% of the total cost.

Foresee hidden costs

No matter the scale of the project, there are always going to be hidden costs. Do you want to include these into your crowdfunding budget or is it something you can handle on your own? It may be tricky to predict the hidden costs you’ll incur, before the project has even begun. But if you’re well-experienced in your work, you should be able to get a hang of at least some of the costs. If you’re a first-timer and are planning to have your debut project crowdfunded, it’ll help to talk to experienced creators!

Be realistic

In essence, crowdfunding is driven by optimism. However, try not to get too overwhelmed by the wave of goodness that’s about to come your way. The higher the money, the more work you’re going to have to put in to raise it. Wisdom lies in raising just the amount you need (refer to step 1). If you raise this amount in a short span, you can always go for stretch goals i.e. adding a further extension to your budget. If you raise this amount and don’t have time left to add stretch goals, you still have the money to green light your project. However, if you set a really high budget right from the beginning and fail to meet the target within the deadline, you run the risk of losing all the money. The key is staying as cost-efficient as possible! Include as many friends and well-wishers who are willing to work pro-bono, offer intangible and experiential benefits, and just get clever about getting work done. Oh, and always be prepared for contingencies!

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