Crowdfunding 101 for early stage start ups

July 01, 2018

Good morning beautiful people,

We are in the last leg of things with our January class (Class Zero) and are already thinking (and discussing) of their exit strategy. 

Most of our Class Zero fellows have figured out what they would like to do and have already tested their ideas - Sarah's Akili HealthCare and Njeri's Naked Souls are some good examples of products from the Academy. We also had a get together where they shared some of their assumptions, challenges and lessons learnt when testing their ideas.

Finances was one of the things mentioned as one of their challenges.

Getting money for projects, especially in the early days, can be tricky as most investors want to see something that is proven and is value for their money yet you need money to prove your idea (sounds like the experience-employment thing where you need experience to be employed yet you need employment to gain experience)

Beside savings, participating in an accelerator/pitch competition or getting early stage investors/grants (there are some organizations like The Pollination Project which give seed funding for early stage projects), crowdfunding is the next best method to get some start up capital for your project especially if you want to prove it is a worth while investment in terms of time, funds and other resources.

Crowdfunding is an online way of fundraising (in Kenya we call it Harambee) where you raise money from different groups of people through the internet. 

Your campaign aka the project you will put online is hosted by a platform and the link you get from the platform is what you share with the various groups of people to contribute.

The beauty of crowdfunding is that not everyone who will eventually contribute is someone you know. This however depends on the effort you put in setting up as well as pushing the campaign during its lifetime.

 There are various crowdfunding platforms across the globe;
I have done crowdfunding with the first and the last platforms and gotten good contributions for the ground work for my SMS line and for the mental health tour that saw me visit 6 counties in Kenya (and led to full sponsorship of the Nigeria leg that saw me visit 6 states there)

Picking the right platform is very important - make sure you pick one that is easily accessible and does not have as many additional costs and processes to you and those contributing to you campaign.

Below are additional things to consider;

CASE STUDY::::#1MilliForJadudi Kenya

The #1MilliForJadudi campaign was launched on August 4th, 2015, with the goal to mobilize Kenyans to raise 1 million Kenya Shillings (approx USD 10,000) to help finance Jadudi’s fourth surgery in India.  The #1MilliForJadudi campaign went viral within hours of launching it, and by the end of day 1, had raised more than the initial $10,000 goal. Within 3 days, about $71,000 had been raised for Jadudi’s medical expenses, by Kenyans all over the country who contributed amounts from as little as $1. This money was donated via MPESA (mobile money) contributions. 

Crowdfunding in Kenya (#1MilliForJadudi) from Zawadi Nyong'o

You can see the full report here 

We will be having a crowdfunding class on July 17th in Nairobi. If you would like to join us, use the email on the 'things to consider when crowdfunding' graphics and we will get back to you with more information.

We would also want to hear from you...Have you done crowdfunding before? What was the process like for you - what worked, what did not? Did you meet your target? Which platforms did you use?

You Might Also Like