The Crowd Funding Services Handbook: Raising the Money You Need to Fund Your Business, Project, or Invention

Chapter 5Crunching the Numbers

In This Chapter

• Create a budget for your reward-based crowd funding campaign.
• Calculate your project’s funding goal.
• Don’t forget about hidden expenses.

Someone once said, “It takes money to make money,” and when it comes to reward-based crowd funding, this statement is somewhat true. Prior to launching your crowd funding campaign to raise the money needed to pursue your project idea, you’ll need to have at least some money on hand to launch and manage the campaign itself, during which you’ll incur a variety of expenses.

It’s true that most of the reward-based crowd funding platforms charge project creators nothing until money is collected from backers. However, to get to that point, you’ll need to spend some money on the planning and creation of your campaign for things like the production of your promotional video, online advertising, and a public relations effort.

Beyond the capital you’ll need to create and manage the actual crowd funding campaign, depending on the scope of your project, additional funds may be needed to get your project idea into a form that’s worthy of being funded. For example, if you’re thinking about manufacturing and selling a product, before launching your campaign you’ll probably need to develop a working prototype or mock-up of the product.

There’s also the time element to consider. If you have a job, preplanning, creating, and managing a crowd funding campaign is going to take a lot of time. In addition to ...