Power your ideas into productivity

Even as most Nigerians complain about the challenges facing the country, more people are praying for more problems. This is because within those problems lies the power to transform the country. You only need to be calm and persevere to see the possibilities.

The difference in perception is the reason why many people are running away from Nigeria. Foreigners who see the possibilities are rushing in, facing and tackling the challenges. And they are making in-roads in several industries in the country.

While many people have creative and innovative ideas, the question of funding has always been the number one limitation facing many entrepreneurs and innovators.

However, the concept of crowd funding is an innovative way to raise funds for ideas. Many people are embracing it as a concept since sourcing for funds from venture capitalists and banks is highly competitive and currently poses a huge challenge to many businesses.

Maybe, the story of tomato juice will inspire you a little. It is no news that Nigerians love fresh tomatoes and tomato paste. Yet, in a country with plenty of arable land, over 60 per cent of tomatoes produced never get to the market. They get rotten before reaching the market because of the shortage of storage and processing facilities in the country.

Since we lack the resources to process and store tomatoes locally, Nigeria remains one of the largest importers of tomato paste in the world. It reportedly wastes almost $500m annually on imported tomato paste.

While this is sometimes considered to be a viable business idea to ‘agropreneurs’, getting banks and investors to invest in the risky and unpredictable agriculture industry can be a daunting task.

Enter the story of Mira Mehta and Shane Kiernan. Last year, the two Harvard- educated Americans successfully raised $54,000 for their start up of tomato juice after their crowd funding campaign on Kickstarter that lasted about 30 days.

While the funding raised from the public on Kickstarter will hardly solve the many challenges within the country’s tomato paste production sector, they have taken a bold step and other people needing the right kind of funding , investment and support can learn a lot from them.

What is crowd funding?

It is the practice of funding a business idea, project or venture by raising monetary contributions from a large number of people via the Internet. Traditional financing used to be about asking people and banks for money. Crowd funding is an innovative way to fund ideas, businesses and projects, especially when you need to escape the problems of documentations and collaterals. It essentially allows you to reach the public or consumers directly, making it look like you are sourcing for funds by sharing envelops but this time digitally.

Some of the most common crowd funding platforms include Kickstarter, Indiegogo, Fundable, GoFundMe, FundedbyMe, Razoo, Pozible, Crowdtivate, MedStartr and 234Give.

Some can be industry-specific and involve ideas in medical, agriculture, application development, service sector and not-for-profit organisations.

Kickstarter is the most popular of all crowd funding platforms and can boast of 9,000 active campaigns at any moment. Till date, there are claims that it has raised over $1.26 billion dollars in funding.

Crowd funding platforms also have a peculiar way of functioning and it is not only donations without partnership and responsibility.

There is the reward-based crowd funding where contributors get no financial returns for their donations. Instead, they are offered thank-you perks or even an early version of the product/service being funded.

This is the most common and offers a project owner requires to get a business idea beyond its present level. And project owners do not need to repay the donations.

However, equity-based crowd funding requires that the donations made are actually investments. This essentially means that crowd funding platform will operate like you are selling shareholding in your company.

How can you succeed with crowd funding campaign?

Kickstarter admits that only 44 per cent of its crowd funding campaigns are successful. However, it is not always the fault of the platforms but challenges are traceable to the business idea, value proposition and positioning. How can you ace a crowdfunding campaign?

Be clear about the problem your business is solving

Most businesses succeed with their crowd funding campaign because they are solving a problem. It is important to identify the challenge you are trying to solve because people will connect with your dreams and aspirations easily. People who understand what you are trying to do are also more likely to invest in your ideas.

Clearly identifying the problem you are solving also helps you immediately identify the solutions you need.

Communicate propositions clearly

You need to communicate the propositions clearly and articulately. Using clearly-established digital tools and platforms such as social and digital media communications, infographics and videos is important. Building a story into your value propositions helps you communicate depth, connect deeply and emotionally with your target audience and build an established brand.

It is a pitch, build it

Crowd funding is an option to begin to consider if you want to choose the largely un-charted road of disrupting the market, beat the existing loopholes