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Related: Which Crowdfunding Method Should You Choose for Your Startup?(VIDEO)Unfortunately, having a great product simply isn’t enough.Licenced companies may also act as crowdfunding platforms.
You also need to be able to position that product correctly to your target market.
You need to understand who your audience is and why they need your product, and then brand and position your product according to that data.
If you want to prove your potential to these investors, you’ll need a long-term plan for your business, and to answer their questions and address their concerns, you’ll need a master business plan to rely on.
Imagine your funding goals are met and you aren’t fully prepared for the first few months of operations. You could have underestimated the amount you needed.
Writing a business plan will help you flesh out these potential costs and prepare the amount of money you’ll actually need to get off the ground.
It can also help you come up with reasonable offerings for each donation level that allow you to remain profitable.To encourage people to support your campaign, you can offer incentives and rewards based on the amount they donate.These incentives and rewards can be anything, such as merchandise, acknowledgement, discounts on future purchase of the product you are developing, etc.Without one, you’ll become one of the vast majority of hopeful entrepreneurs who find themselves without enough capital to keep moving. Taking the time to write a business plan instead can help you work out the kinks of your product -- and your core idea.Related: 5 Reasons to Write a Business Plan If you have a great idea and you’re excited to see how much attention or capital it can generate online, stop for a minute. Business plans force you to work through the challenges and to evolve to a more effective model, which will ultimately increase your chances of getting funded.Business plans exist to help you prepare for those obstacles and force you to set realistic, measurable goals for your initial launch.It will also help you understand the competitive landscape, the behaviors and patterns of the current market, and how your product could realistically fit among them.Some crowdfunders are merely interested in getting something in exchange for their investment (such as a sample or prototype of your product).Others only invest in ideas that have real long-term potential.For example, you can set that for every donation of , you will acknowledge the donor on your product’s website.For every donation of , you will discount 5% off the purchase of your product.