How to Create an Effective Crowdfunding Video for Your Startup

Crowdfunding is not only a popular strategy for getting a product or startup off the ground, but also an increasingly viable one.

New legislation lets startups raise capital from the general public. Companies can now receive up to $1 million from non-accredited investors, prompting many businesses to enter the arena and, ultimately, attract more issuers.

What’s more, equity crowdfunding companies like Fundable make the process really easy for companies to raise money on their platforms, which has led to a big expansion in the space.

If you want to reach and inspire the crowdfunding community, video is a great medium. In fact, campaigns that utilize video crowdfunding pitches garner four times more funding than those that don’t.

While the interest a crowdfuning pitch video generates isn’t guaranteed to translate into dollars, from my vantage point at the convergence of video production and digital marketing, I can tell you: Video is the most effective way to provide valuable content about how your startup can help potential customers and investors solve a problem or fill a need.

That audience helped raise $34.4 billion in 2015 — setting up crowdfunding to beat venture capital in terms of funding within a year and grow into a $300 billion industry in just 10 years. Don’t you want to get in on that action?

The Cold, Hard Truth

Unfortunately, most crowdfunding campaigns fail. There it is.

Kickstarter.com’s stats page cites a low (and quite precise) campaign success rate of 35.76 percent. While that’s a sobering number, it underscores the dramatic boost in funding a video pitch earns. Typical crowdfunding campaigns often consist of a lot of long text-based content, which can turn off your typical crowdfunding investor.

Crowdfunders want to understand the product or person they’re investing in. Luckily, a two-minute crowdfunding video can quickly provide all the information on your backstory, general facts, technology, and team — stuff that would require pages and pages of text to describe — in a highly engaging format.

Of course, the point of using video isn’t to reach lazy people or slow readers. Video facilitates a more meaningful connection between funders and founders. When founders share their own emotional investments in their products, the result can be contagious excitement among funders. That is your goal.

Creating an Effective Crowdfunding Campaign Video

Why do you believe your product will succeed? Your crowdfunding video needs to illustrate its value to potential customers and investors alike. Here are a few important features that will help you do that.

First, highlight the personality and potential of your business.

Your crowdfunding video campaign will still contain lots of financial material for interested investors to peruse. When making your video, aim to showcase the most important details to draw in potential supporters.

Include who makes up your team, when you expect to have your business off the ground, and why you think it’s a worthy investment. Don’t be vague. Without these details, why would people give you their money?

Next, convey more than your business plan.

Your pitch video should reflect your company’s story. Demonstrate how it ties in to the business model you’ve created and any ways in which it might relate to the market need you’re trying to address.

The pitch video the Woodgate family created for their crowdfunding campaign, for example, told the story of the inspiration behind its brand, cuddle + kind.

After realizing the global impact of childhood hunger, the family decided to sell handmade cuddle + kind dolls to combat its devastating effects by using the profits to feed children. The video enhanced their compelling story with beautiful visuals of kids playing with the dolls, proving to investors that the startup had not only good intentions, but also a high potential for success.

Finally, conclude with a call to action.

Imagine your video has the audience completely on board. What do you want them to do next?

Whether you’re looking for campaign contributions (i.e., “Make an investment of your choosing”), additional exposure via social media (e.g., “Give us a like or share”), or feedback on your proposal (e.g., “Leave us a comment below”) — ask for it clearly and directly!

The CTA in Coolest Cooler’s video incorporates graphic arrows that point to the share button and blatantly asks viewers to share it. With this easy-to-follow visual directive, the brand significantly expanded its network and fan base.

Ultimately, giving potential investors an avenue for interaction at the end of your video is one of the most effective ways to generate additional leads.

Don’t let Kickstarter’s underwhelming success rate stop you from exploring crowdfunding as a way to launch your business to new heights. Focus on what you can control, like harnessing the proven power of video pitches to draw funding for your campaign. Using the above tactics, you’ll be well on your way to producing a video that creates a strong connection between your business and potential investors or customers.

Do you have a crowdfunding success story or a video pitch that you’re particularly proud of? Please share it in the comments below!