Crowdfunding, Russian-speaking environment and software start-up ...
This is a publication on how to organize and conduct a crowdfunding company to raise funds for a software startup in the Russian-speaking environment.
One practice tested with specific instructions and examples will be described. Separately, the features of fundraising will be considered: in the Russian-speaking environment; on a startup; on software (software, web service) product. Something of the above is very obvious, something has already been said many times, but such things that most people do not even know about and which have never been mentioned anywhere will be described (at least I haven’t met at all, but I got acquainted with number of materials about crowdfunding).
Attention! Under the cut is a VERY BIG ARTICLE!
Many have heard the word “crowdfunding”, many know its definition, some even read books about it, and some have participated by supporting a project. But all this does not give a complete, logical and subconscious understanding of what this crowdfunding is all the same. The only way to “know crowdfunding” is to organize and conduct a crowdfunding company yourself, using all your analytical skills and an integrated systems approach.
')
Why is crowdfunding such an ambiguous phenomenon? Yes, because it affects many areas of activity:
Crowdfunding is such a complex process, in which so many things are mixed in that in order to understand it, to model it, it is necessary to make a huge amount of intellectual effort. At the same time, look at the problem both from individual areas and in general. To know this in theory is almost impossible, so, starting a crowdfunding company, get ready to learn from practice: get new knowledge, and most importantly sensations, quickly analyze them and react accordingly.
After such an entry for justice, it is worth noting that there are many situations in which such a deep understanding of the crowdfunding phenomenon is not required in order to conduct a successful fundraising campaign. In a loyal English-speaking environment, or when raising funds for a socially useful project involving many personally, a thorough study of this topic is not necessary. You can act intuitively, based on basic knowledge in this area, and everything will work out for you. But if you have a “crowdfunding campaign to raise funds to support a software startup in the Russian-speaking environment,” then the above described attitude is the only key to success.
The general model of crowdfunding campaign from the position of the author of the project can be described as follows:
But from the position of a sponsor (he is “Becker” - a person who financially supported the idea of ​​the author) or a potential sponsor, the crowdfunding company’s model looks somewhat different:
Look at the number of “some” and “no or yes” in the crowdfunding model from the position of Becker. This tells us that we will encounter a multitude of previously unknown factors in people's behavior, motives, and decisions.
What these two models give, what necessary and useful conclusions in practice can be drawn from them:
* * *
We already know how versatile and large-scale the concept of "crowdfunding". We have an idea of ​​what model it works on. For completeness of understanding, it is necessary to formally describe all the entities and processes that are in this model.
Key entities and processes in crowdfunding:
So, a little more about the components of key entities:
The idea of ​​the project is primarily characterized by the type of implementation, and secondly - by the subject.
The type of implementation is what we get in the end. This could be a physical object (fundraising for publishing a book, recording and publishing a music album, producing furniture, publishing a calendar, etc.), or a digital product (computer game, software, web service, etc.). With the subject of physical objects and computer games I think everything is clear; for a music album it will be a genre; for the film - the theme and genre in which it is removed; for the calendar - the theme, style and format in which it will be made; for furniture - household or office use, etc. More difficult with software and web services: for them the subject is the area in which they will be applied.
Depending on the type of implementation and subject matter of the idea, it is possible to predict the reaction of the audience to the crowdfunding project, to identify the most effective methods of presentation and promotion of the project. According to this classification, the type of projects was identified, for which crowdfunding is referred to in this article - “Soft Startups”. All of the above was true to some extent for any crowdfunding company, but now it will be about crowdfunding promotions for “software startups”.
Motivation of the audience. We can distinguish the following motives for which a person becomes a sponsor (in addition to the psychological types of backers from the article at the link above):
IMPORTANT! All the stated facts and the stated theses relating to step “3” are the personal considerations of the author of this article. These considerations appeared after a rough and superficial collection of statistics, but a very detailed empirical analysis. Those. All the above figures and the assumptions made should NOT be considered absolutely accurate and reliable. Of course, I tried to bring them as close as possible to the truth, but I did not conduct a full-sized and comprehensive study, so I can be mistaken about something.
The first thing you need to know about the third step:
Only 1-2% of projects related to software startups that tried to raise funds by crowdfunding so far (end of 2014 and earlier) in the Russian-speaking environment completed the collection successfully. Ie, if you are now trying to raise money by crowdfunding your software start-up in the Russian-speaking environment, then with a probability of 98-99% you will fail.
Let's try to figure out what such sad statistics are from. First, 70-80% of the authors of the projects are themselves to blame for the fact that their actions ended in failure. They are either not of high quality or not fully conducted work related to the crowdfunding action. Another 5-10% of the authors failed because they chose an uninteresting, unclaimed (from the perspective of the theme and implementation form) idea for their projects, and the necessary number of people motivated only by their personality, and not the project itself, didn’t get enough sponsors. Well, 25-10% of the projects remain, the authors of which did everything right, and they had a worthwhile idea, so why did only 1-2% succeed? And here the features of the Russian-speaking crowdfunding environment are “to blame”, let's talk about them in detail:
Crowdfunding is a fairly new phenomenon for the Russian-speaking audience, for the majority it is completely new. Get ready for what channel of promotion you would use, all the time you have to work on informing the audience, explaining what crowdfunding is, why you need it, what are its features, how it differs from begging, financial pyramids and other negative things, “ survived the Russian-speaking audience. You need to become an expert in the concept of crowdfunding and combine this with the role of the marketer of “god level” in order to be able to explain to anyone in one short sentence everything that is written in this article.
At this weak awareness of the audience does not end there. For me it has become a personal discovery that many people do not know what a “startup” is and, in principle, are not aware of this stage and its features among start-up companies. Those. in addition to explaining what crowdfunding is, you will have to explain what a startup is.
The second problem does not directly follow from the first, but is closely related to it. A rather large percentage of the audience who know what crowdfunding is, treats it very negatively. The reasons are very different, but this has already been said many times. I will not repeat, look for materials on the topic “How to work with objections when dealing with opponents of crowdfunding”.
But again, the surprise was that we have no less and opponents of startups. Yes, the word “startup” has become an abusive language for many, and I think we can all understand why - quite a lot of material has also been written about this. Prepare in advance theses, why your startup is not “another event for pulling money out of the investor, then merge quickly”; Prepare answers to questions about the value and viability of your idea, etc.
Dashing 90s and chaotic 00s with the flourishing of pirated software also played a disastrous role for crowdfunding in a software start-up. There is still a stereotype in the mass consciousness that it is not necessary to pay for software. And with “free and open” software it is not connected at all ... People in many cases do not want to pay for ready-made software, and here you ask for money for its development, at best presenting it as a prepaid purchase with a big discount.
The only way to work on this objection is the economic and legal arguments for licensed software. If they do not work (as happens in most cases), the opponent will reassure only personal experience of obtaining legal punishment for using pirated software, and this is already outside your jurisdiction.
The following argument is not uncommon for a Russian-speaking audience: “In Russia, in principle, they do nothing worthwhile that can withstand competition on the world market. Starting the automotive industry and ending with software. ” These personalities use everything foreign only, and they don’t need anything of domestic production / development.
As practice has shown, it is impossible to convince this group at all.
Many people begin to critically criticize either an idea, or a team, or the competitiveness of an idea, methods of organizing work on its implementation, etc. At the same time, they are convinced that they bring powerful arguments to their arguments. Although any expert will immediately see that these arguments are either not at all on the topic, or “far-fetched”, or are fundamentally wrong.
Work with the objection: try to bring adequate and correct counterarguments. If the opponent is a logical person, and agrees with them, we continue the dialogue. If not - stop the dialogue, to persuade this person will not work.
The phenomenon of criticism for criticism in the spirit is very common: “this idea is a failure, because it is a failure”. And to get from the author of such a statement at least some arguments in favor of his assumption will not work.
The only work with such objections is a complete disregard for such statements without spending time on discussion with their authors.
Here it is worthwhile to run a little ahead and briefly describe the classification of the channels of advancement according to the type of coverage and interaction with the audience, namely, to distinguish three groups:
a) Advertising without the possibility of receiving feedback (from targeted advertising to advertising publications without the discussion / comments function);
b) Personal appeal (PM-correspondence, e-mail correspondence \ mailings, etc.);
c) Content / advertising promotion with the possibility of feedback through comments / discussions (from forums to the blogosphere).
As you can guess, in case a) the described negative features of the Russian-speaking environment do not appear, but in cases b) and c) they are present. And if for b) this is a personal objection that ends with the negative reaction of one person, then in case c) such a “feature” can completely “kill” the promotion channel.
Example: Being engaged in content promotion, you are preparing interesting and useful material with a small advertising insert about your crowdfunding campaign to support a software start-up. You publish it, for example, in your personal blog, and in the comments you get all of the above - from misunderstanding and criticism of crowdfunding and startups to unwillingness to buy software in principle or use domestic developments. If it was limited to the personal attitude of the authors of such comments - do not worry. But since they are made in the public form of a comment, they affect the entire audience of this promotion channel, so you have to begin work with objections. It is clear that at some Russian-speaking sites this “effect” is present to a greater extent, at some - to a lesser extent. But, in any case, it is necessary to take it into account, be emotionally prepared for it and be able to work professionally with it.
So, I talked about everything you need to know, understand and take into account before embarking on a crowdfunding campaign. You can go directly to its implementation. Below is a step-by-step method of how to do it.
You can think about crowdfunding on a software startup only if you have at least a prototype or an early alpha on your hands. It’s just not to think about it with the “project idea”. First, on most sites, your crowdfunding project will not even pass moderation without at least some demo product. Secondly (if the moderation is completed after all), with a probability that is very close to unity in the Russian-speaking environment, the “idea” should not be recruited, whatever that idea may be.
Exceptions are only those cases where the author of the idea “has a Name”, and \ or he is a respected member of any large community, and \ or has popular products that he developed earlier. In this and only this case, there is a chance to raise funds without having a prototype.
But even if you already have a demo product, it does not mean anything. It is necessary to test it for viability / demand. At least, make a presentation of at least a hundred representatives of the target audience of the project. If the positive reaction is from 10% and more, then it is possible to continue further. If not, then perhaps it is generally worth refusing this idea.
At the same time, if your project is not from the “just for fun” series, then I strongly recommend very responsibly and carefully approach this research. Gather a full-fledged focus group, make a presentation, provide a demo product and complete it with a full-fledged questionnaire. After that, statistics on pre-defined metrics are added. And not just to call a couple of friends, briefly show them your prototype and ask: “Well, how?”. Crowdfunding is working with a mass audience, and you need to prepare for it from the very beginning.
In addition to the test of ideas, it does not hurt at the same time to produce an empirical analysis of its subject matter for suitability for a crowdfunding campaign in the Russian-language market. To do this, simply look for information about other crowdfunding projects in this area, and it will not necessarily be software projects. For example, if your project is a program for calculating the cost of building a private cottage, feel free to look for projects on the subject of “construction”. These can be books on construction, films about building something, etc. Having found such projects, you will be convinced that the Russian-speaking audience loves to build and willingly supports such projects. Or it may turn out differently: your project is software for optimization of personal financial expenses, respectively, the subject is “personal finance”. If you look at the crowdfunding projects on this subject - publishing the same books, holding seminars, etc. - it can be found that for the most part they fail. This does not mean that your software will be commercially unsuccessful, it means that in the Russian-speaking environment, you will most likely not be able to conduct a successful crowdfunding company to raise funds for it.
At this stage it is necessary: ​​to determine the volume of the potential market, find out the average cost of the check, identify competitors and the percentage of the market they occupy. Focusing on the indicators obtained, to draw conclusions about the desirability of further work. How to make an analysis of the markets, you can write a separate article, now I will give only general techniques:
All users can be divided into three large groups:
a) Those who have a problem solved by your product, and they are looking for its solution.
b) Those who have a problem, they have already found and use another solution.
c) Those who have a problem, but they still do not realize it.
To find out the size of a group, a) a semantic core is assembled with search queries about finding solutions to users' problems; statistics are collected with the number of requests per month in Yandex and Google.
When figuring out the size of group b), open statistics are collected on how many users have similar products and competing products. Data on the cost of these products is also collected, and the average is considered to be the “average bill”. This also includes work on identifying the number of users of competing products for the subsequent calculation of their market share.
With the calculation of the group in) the greatest difficulties. Here the methodology is more complicated and is built on relative, rather than absolute, metrics. (Briefly: a mass audience is surveyed, data from this survey is taken, the percentages obtained are multiplied by the total audience, which is considered in its own way for different subject areas).
Further we analyze the proportion “total market volume \ average check”. For software that is sold at a time (or with a rare subsequent sale of new versions, updates), this proportion should be between 500 and higher; for software that is sold on monthly subscriptions of 50 and above. In this case, the total volume of the share occupied by competitors, taking into account the audience belonging to group c), should not exceed 80-90%. Only with such indicators can we hope for a successful crowdfunding company.
Even if your product has passed the “test of the idea” and “test of the subject”, and the markets it is aimed at are very promising, this is not enough for successful crowdfunding. It is necessary to “revive” your project. To make the project alive, we need supporters and interested people gathered on the same site. Nobody speaks about the thousands community, but 100-200 active people and at least 3-10 evangelists should already be present in the community.
Get accounts \ community \ groups in social networks. For the Russian-speaking audience, I recommend a bunch: VKontakte, Facebook, Google+, Twitter. Learn the basics of SMM: determine the topics of your groups (related to the specifics of your product, the problem that it solves). Prepare unique materials on the subject and subject publications suitable for repost. Make a plan of publications by groups in social. networks, fill them with the first content and start to attract the audience to your groups.
Puzzled by accounts on large thematic resources. If your project, for example, from the sphere of finance, find a popular forum on finance, register on it, start communication, raise topics close to your project, so far without advertising. . ( — http://special.habrahabr.ru/hello_startup/habrahabr/ ) — http://spark.ru/ . 3-4 , . — .
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The general conclusion : software startups should engage in crowdfunding in the Russian-speaking environment, the main thing is to set priorities (not in favor of the goal of obtaining the necessary funding).
Hope this stuff was helpful. And of course good luck with your crowdfunding campaigns!
Kirill,
Project Manager Design and layout solution SketchBuilder
One practice tested with specific instructions and examples will be described. Separately, the features of fundraising will be considered: in the Russian-speaking environment; on a startup; on software (software, web service) product. Something of the above is very obvious, something has already been said many times, but such things that most people do not even know about and which have never been mentioned anywhere will be described (at least I haven’t met at all, but I got acquainted with number of materials about crowdfunding).
Attention! Under the cut is a VERY BIG ARTICLE!
Step “0”: You must have a clear idea of ​​the scope and diversity of the concept of crowdfunding
Many have heard the word “crowdfunding”, many know its definition, some even read books about it, and some have participated by supporting a project. But all this does not give a complete, logical and subconscious understanding of what this crowdfunding is all the same. The only way to “know crowdfunding” is to organize and conduct a crowdfunding company yourself, using all your analytical skills and an integrated systems approach.
')
Why is crowdfunding such an ambiguous phenomenon? Yes, because it affects many areas of activity:
- Economic - investment, business and financial management;
- Socio-psychological - behavioral, consumer, group, simultaneously conscious and emotional aspects of human activity;
- Marketing - product promotion, collection and analysis of feedback, advertising and PR-activities, etc.
Crowdfunding is such a complex process, in which so many things are mixed in that in order to understand it, to model it, it is necessary to make a huge amount of intellectual effort. At the same time, look at the problem both from individual areas and in general. To know this in theory is almost impossible, so, starting a crowdfunding company, get ready to learn from practice: get new knowledge, and most importantly sensations, quickly analyze them and react accordingly.
After such an entry for justice, it is worth noting that there are many situations in which such a deep understanding of the crowdfunding phenomenon is not required in order to conduct a successful fundraising campaign. In a loyal English-speaking environment, or when raising funds for a socially useful project involving many personally, a thorough study of this topic is not necessary. You can act intuitively, based on basic knowledge in this area, and everything will work out for you. But if you have a “crowdfunding campaign to raise funds to support a software startup in the Russian-speaking environment,” then the above described attitude is the only key to success.
Step “1”: Crowdfunding - we get the basic knowledge. Or: “We form an unequivocal understanding of what crowdfunding is and how it works, what goals need to be set, how to model and monitor the situation”
The general model of crowdfunding campaign from the position of the author of the project can be described as follows:
- The author of the project has an idea, for its implementation he needs funding and / or audience attention to the idea;
- The author decides to attract funding and / or audience attention through crowdfunding;
- The author chooses a crowdfunding platform (or adds the necessary functionality to his site);
- A “crowdfunding project” is created - usually this is one web page where the description of the idea is posted, how much money is needed for its implementation, a description of the “rewards” for those who decide to support the idea, and a payment system.
- The project is published;
- Work begins to attract traffic to the project page.
But from the position of a sponsor (he is “Becker” - a person who financially supported the idea of ​​the author) or a potential sponsor, the crowdfunding company’s model looks somewhat different:
- The person in any way learns about the crowdfunding company;
- For any reason, the crowdfunding campaign interested him, and he goes to the page of the crowdfunding project;
- Having studied the project page, a person either decides to support him financially (to become a Becker), or decides not to do this;
- After the previous step (no matter whether the project was supported or not), a person can participate in the project’s life or not.
Look at the number of “some” and “no or yes” in the crowdfunding model from the position of Becker. This tells us that we will encounter a multitude of previously unknown factors in people's behavior, motives, and decisions.
What these two models give, what necessary and useful conclusions in practice can be drawn from them:
- Crowdfunding is used not only to raise funds, but also to work with project audiences. At the same time, it is possible to identify different goals both for raising funds and for working with the audience:
a) Attracting general funding - raising funds for the implementation of the whole idea;
b) Attracting targeted financing - raising funds for the implementation of any part of the idea;
c) The reason and method to advertise your product;
d) A way to get feedback from the audience - from a test of viability and financial demand for the idea to bug reports and wishes on the feature list.
Before embarking on a crowdfunding company, you need to, firstly, decide what specific goals you want to achieve, and secondly, prioritize them.
- From the point of view of the author of the project, crowdfunding is very similar to the sales process through landing. It is worth exploring the sales materials through landings, and even better to have experience of such sales - then a lot of crowdfunding will become more understandable. I will note the key points that can be adopted in crowdfunding from sales through landing:
a) Your project page is the landing page for the user. It also has a targeted action - to encourage the visitor to make a payment and become a project sponsor. Accordingly, almost all design principles and design of “selling” landing pages will be relevant for the pages of crowdfunding projects;
b) The metrics used in the landing pages (conversion of visitors into buyers, percentage of secondary purchases, repeated returns per page, etc.) are also applicable to crowdfunding project pages.
c) The main principle of sales through landings - “in order to make purchases, visitors are necessary” - is completely fair for crowdfunding. Organic traffic is negligible, therefore, in order to successfully complete the fundraising campaign, it is necessary to work to attract traffic to the project page. The only difference is that the sources of traffic and the assessment of its “quality” in crowdfunding still differ from those when using landing pages, which is lower.
- It is necessary to highlight the stages through which the becker passes, analyze each stage and monitor the conversion during the transition from stage to stage:
a) Stage one: “The man learned about the crowdfunding campaign”.
Analyze this stage: How did a person find out about crowdfunding? (Promotional channels). Did the person previously knew about your project / idea, or would it find out at the same time as information about crowdfunding fundraising? (Analysis of the degree of involvement / loyalty at an early stage). How to “present” a crowdfunding campaign to a person so that it interests him? (Marketing and advertising approaches). Does the person immediately decide to proceed to the next stage or refuse to support the project? (On many channels of attraction, you can get feedback and work with objections at this stage).
b) Stage Two: “The person goes to the project page”.
This stage includes everything said earlier in the analogy of landing pages with the pages of crowdfunding projects.
c) - Stage Three, option one: “The person makes the payment”;
What prompted a person to make a payment? Will the person continue to follow the fate of the project? Maybe he can help not only financially, but also with informational advancement?
- Stage three, option two: “The person does not make payment”;
The same questions as in the first version, but only from the “refusal to make a payment” position.
* * *
We already know how versatile and large-scale the concept of "crowdfunding". We have an idea of ​​what model it works on. For completeness of understanding, it is necessary to formally describe all the entities and processes that are in this model.
Key entities and processes in crowdfunding:
- A crowdfunding project page consisting of the sub-entities: a text description and other presentation materials for the idea; the list of rewards that the user will receive;
- An audience that may or may not be a sponsor of a project. It is necessary to know about the potential audience: what types it can be divided into, and how to interact with each type. This is a good article written on this - “The psychological types of backers” habrahabr.ru/post/147670 . It is required to read; even more - I advise you to first read this article, and only then continue reading this post. In addition to the psychological type, the representative of the audience has a motive why he will or will not become a sponsor. I will talk about the motives below.
- Promotional channels - sources and ways to attract traffic to the project page. I will also tell about them in more detail below.
So, a little more about the components of key entities:
The idea of ​​the project is primarily characterized by the type of implementation, and secondly - by the subject.
The type of implementation is what we get in the end. This could be a physical object (fundraising for publishing a book, recording and publishing a music album, producing furniture, publishing a calendar, etc.), or a digital product (computer game, software, web service, etc.). With the subject of physical objects and computer games I think everything is clear; for a music album it will be a genre; for the film - the theme and genre in which it is removed; for the calendar - the theme, style and format in which it will be made; for furniture - household or office use, etc. More difficult with software and web services: for them the subject is the area in which they will be applied.
Depending on the type of implementation and subject matter of the idea, it is possible to predict the reaction of the audience to the crowdfunding project, to identify the most effective methods of presentation and promotion of the project. According to this classification, the type of projects was identified, for which crowdfunding is referred to in this article - “Soft Startups”. All of the above was true to some extent for any crowdfunding company, but now it will be about crowdfunding promotions for “software startups”.
Motivation of the audience. We can distinguish the following motives for which a person becomes a sponsor (in addition to the psychological types of backers from the article at the link above):
- Interest in the subject of the project. For example: a person sponsors a project, because he likes the subject “Great Patriotic War”. This topic is always relevant, he has heard a lot about her and is emotionally involved in it. To such a sponsor, in fact, it does not matter in what format the final product will be - the calendar is, a book, a movie, a computer game or something else. The main thing is that within the framework of this subject matter, the rest is not important.
- Personal sympathy of the sponsor to the author of the project. Those. Becker is motivated to contribute the very identity of the author. The reasons for such a motive may be different, for example, Becker is a friend of the author, he is ready to support the author, and he does not care what his friend does for the project. There may be reasons not related to personal acquaintance - the author of the project may be an idol or just an interesting / becker-like person.
- Personal benefit from the project. Becker does not care who makes the project and in what framework. He looks at the result that will be after the implementation of the project, and understands that this result will be personally useful to him. Therefore, Becker is motivated to make a contribution and get the result of the implementation of the idea. It could be a game in which the becker wants to play, maybe the furniture that the becker wants to get, etc.
Step “2”: Find out the specifics of crowdfunding in the Russian-speaking environment in general and with respect to the software startup in particular
IMPORTANT! All the stated facts and the stated theses relating to step “3” are the personal considerations of the author of this article. These considerations appeared after a rough and superficial collection of statistics, but a very detailed empirical analysis. Those. All the above figures and the assumptions made should NOT be considered absolutely accurate and reliable. Of course, I tried to bring them as close as possible to the truth, but I did not conduct a full-sized and comprehensive study, so I can be mistaken about something.
The first thing you need to know about the third step:
Only 1-2% of projects related to software startups that tried to raise funds by crowdfunding so far (end of 2014 and earlier) in the Russian-speaking environment completed the collection successfully. Ie, if you are now trying to raise money by crowdfunding your software start-up in the Russian-speaking environment, then with a probability of 98-99% you will fail.
Let's try to figure out what such sad statistics are from. First, 70-80% of the authors of the projects are themselves to blame for the fact that their actions ended in failure. They are either not of high quality or not fully conducted work related to the crowdfunding action. Another 5-10% of the authors failed because they chose an uninteresting, unclaimed (from the perspective of the theme and implementation form) idea for their projects, and the necessary number of people motivated only by their personality, and not the project itself, didn’t get enough sponsors. Well, 25-10% of the projects remain, the authors of which did everything right, and they had a worthwhile idea, so why did only 1-2% succeed? And here the features of the Russian-speaking crowdfunding environment are “to blame”, let's talk about them in detail:
1. Weak awareness of the Russian-speaking audience.
Crowdfunding is a fairly new phenomenon for the Russian-speaking audience, for the majority it is completely new. Get ready for what channel of promotion you would use, all the time you have to work on informing the audience, explaining what crowdfunding is, why you need it, what are its features, how it differs from begging, financial pyramids and other negative things, “ survived the Russian-speaking audience. You need to become an expert in the concept of crowdfunding and combine this with the role of the marketer of “god level” in order to be able to explain to anyone in one short sentence everything that is written in this article.
At this weak awareness of the audience does not end there. For me it has become a personal discovery that many people do not know what a “startup” is and, in principle, are not aware of this stage and its features among start-up companies. Those. in addition to explaining what crowdfunding is, you will have to explain what a startup is.
2. Negative attitude to crowdfunding and start-ups in general.
The second problem does not directly follow from the first, but is closely related to it. A rather large percentage of the audience who know what crowdfunding is, treats it very negatively. The reasons are very different, but this has already been said many times. I will not repeat, look for materials on the topic “How to work with objections when dealing with opponents of crowdfunding”.
But again, the surprise was that we have no less and opponents of startups. Yes, the word “startup” has become an abusive language for many, and I think we can all understand why - quite a lot of material has also been written about this. Prepare in advance theses, why your startup is not “another event for pulling money out of the investor, then merge quickly”; Prepare answers to questions about the value and viability of your idea, etc.
3. There is no “habit” to pay for software.
Dashing 90s and chaotic 00s with the flourishing of pirated software also played a disastrous role for crowdfunding in a software start-up. There is still a stereotype in the mass consciousness that it is not necessary to pay for software. And with “free and open” software it is not connected at all ... People in many cases do not want to pay for ready-made software, and here you ask for money for its development, at best presenting it as a prepaid purchase with a big discount.
The only way to work on this objection is the economic and legal arguments for licensed software. If they do not work (as happens in most cases), the opponent will reassure only personal experience of obtaining legal punishment for using pirated software, and this is already outside your jurisdiction.
4. Negative attitude to the “domestic producer”.
The following argument is not uncommon for a Russian-speaking audience: “In Russia, in principle, they do nothing worthwhile that can withstand competition on the world market. Starting the automotive industry and ending with software. ” These personalities use everything foreign only, and they don’t need anything of domestic production / development.
As practice has shown, it is impossible to convince this group at all.
5. Love of a large number of people to “well” reasoned criticism.
Many people begin to critically criticize either an idea, or a team, or the competitiveness of an idea, methods of organizing work on its implementation, etc. At the same time, they are convinced that they bring powerful arguments to their arguments. Although any expert will immediately see that these arguments are either not at all on the topic, or “far-fetched”, or are fundamentally wrong.
Work with the objection: try to bring adequate and correct counterarguments. If the opponent is a logical person, and agrees with them, we continue the dialogue. If not - stop the dialogue, to persuade this person will not work.
6. The love of many for non-argued criticism.
The phenomenon of criticism for criticism in the spirit is very common: “this idea is a failure, because it is a failure”. And to get from the author of such a statement at least some arguments in favor of his assumption will not work.
The only work with such objections is a complete disregard for such statements without spending time on discussion with their authors.
How do these features of the Russian-speaking environment influence the crowdfunding campaign to raise funds for a software startup?
Here it is worthwhile to run a little ahead and briefly describe the classification of the channels of advancement according to the type of coverage and interaction with the audience, namely, to distinguish three groups:
a) Advertising without the possibility of receiving feedback (from targeted advertising to advertising publications without the discussion / comments function);
b) Personal appeal (PM-correspondence, e-mail correspondence \ mailings, etc.);
c) Content / advertising promotion with the possibility of feedback through comments / discussions (from forums to the blogosphere).
As you can guess, in case a) the described negative features of the Russian-speaking environment do not appear, but in cases b) and c) they are present. And if for b) this is a personal objection that ends with the negative reaction of one person, then in case c) such a “feature” can completely “kill” the promotion channel.
Example: Being engaged in content promotion, you are preparing interesting and useful material with a small advertising insert about your crowdfunding campaign to support a software start-up. You publish it, for example, in your personal blog, and in the comments you get all of the above - from misunderstanding and criticism of crowdfunding and startups to unwillingness to buy software in principle or use domestic developments. If it was limited to the personal attitude of the authors of such comments - do not worry. But since they are made in the public form of a comment, they affect the entire audience of this promotion channel, so you have to begin work with objections. It is clear that at some Russian-speaking sites this “effect” is present to a greater extent, at some - to a lesser extent. But, in any case, it is necessary to take it into account, be emotionally prepared for it and be able to work professionally with it.
Step “3”: Methods of preparing and conducting a crowdfunding campaign for a software startup
So, I talked about everything you need to know, understand and take into account before embarking on a crowdfunding campaign. You can go directly to its implementation. Below is a step-by-step method of how to do it.
Step One: “Checking the Idea”
You can think about crowdfunding on a software startup only if you have at least a prototype or an early alpha on your hands. It’s just not to think about it with the “project idea”. First, on most sites, your crowdfunding project will not even pass moderation without at least some demo product. Secondly (if the moderation is completed after all), with a probability that is very close to unity in the Russian-speaking environment, the “idea” should not be recruited, whatever that idea may be.
Exceptions are only those cases where the author of the idea “has a Name”, and \ or he is a respected member of any large community, and \ or has popular products that he developed earlier. In this and only this case, there is a chance to raise funds without having a prototype.
But even if you already have a demo product, it does not mean anything. It is necessary to test it for viability / demand. At least, make a presentation of at least a hundred representatives of the target audience of the project. If the positive reaction is from 10% and more, then it is possible to continue further. If not, then perhaps it is generally worth refusing this idea.
At the same time, if your project is not from the “just for fun” series, then I strongly recommend very responsibly and carefully approach this research. Gather a full-fledged focus group, make a presentation, provide a demo product and complete it with a full-fledged questionnaire. After that, statistics on pre-defined metrics are added. And not just to call a couple of friends, briefly show them your prototype and ask: “Well, how?”. Crowdfunding is working with a mass audience, and you need to prepare for it from the very beginning.
In addition to the test of ideas, it does not hurt at the same time to produce an empirical analysis of its subject matter for suitability for a crowdfunding campaign in the Russian-language market. To do this, simply look for information about other crowdfunding projects in this area, and it will not necessarily be software projects. For example, if your project is a program for calculating the cost of building a private cottage, feel free to look for projects on the subject of “construction”. These can be books on construction, films about building something, etc. Having found such projects, you will be convinced that the Russian-speaking audience loves to build and willingly supports such projects. Or it may turn out differently: your project is software for optimization of personal financial expenses, respectively, the subject is “personal finance”. If you look at the crowdfunding projects on this subject - publishing the same books, holding seminars, etc. - it can be found that for the most part they fail. This does not mean that your software will be commercially unsuccessful, it means that in the Russian-speaking environment, you will most likely not be able to conduct a successful crowdfunding company to raise funds for it.
Stage Two: “Market Analysis”
At this stage it is necessary: ​​to determine the volume of the potential market, find out the average cost of the check, identify competitors and the percentage of the market they occupy. Focusing on the indicators obtained, to draw conclusions about the desirability of further work. How to make an analysis of the markets, you can write a separate article, now I will give only general techniques:
All users can be divided into three large groups:
a) Those who have a problem solved by your product, and they are looking for its solution.
b) Those who have a problem, they have already found and use another solution.
c) Those who have a problem, but they still do not realize it.
To find out the size of a group, a) a semantic core is assembled with search queries about finding solutions to users' problems; statistics are collected with the number of requests per month in Yandex and Google.
When figuring out the size of group b), open statistics are collected on how many users have similar products and competing products. Data on the cost of these products is also collected, and the average is considered to be the “average bill”. This also includes work on identifying the number of users of competing products for the subsequent calculation of their market share.
With the calculation of the group in) the greatest difficulties. Here the methodology is more complicated and is built on relative, rather than absolute, metrics. (Briefly: a mass audience is surveyed, data from this survey is taken, the percentages obtained are multiplied by the total audience, which is considered in its own way for different subject areas).
Further we analyze the proportion “total market volume \ average check”. For software that is sold at a time (or with a rare subsequent sale of new versions, updates), this proportion should be between 500 and higher; for software that is sold on monthly subscriptions of 50 and above. In this case, the total volume of the share occupied by competitors, taking into account the audience belonging to group c), should not exceed 80-90%. Only with such indicators can we hope for a successful crowdfunding company.
Stage Three: “Creating a Community”
Even if your product has passed the “test of the idea” and “test of the subject”, and the markets it is aimed at are very promising, this is not enough for successful crowdfunding. It is necessary to “revive” your project. To make the project alive, we need supporters and interested people gathered on the same site. Nobody speaks about the thousands community, but 100-200 active people and at least 3-10 evangelists should already be present in the community.
Get accounts \ community \ groups in social networks. For the Russian-speaking audience, I recommend a bunch: VKontakte, Facebook, Google+, Twitter. Learn the basics of SMM: determine the topics of your groups (related to the specifics of your product, the problem that it solves). Prepare unique materials on the subject and subject publications suitable for repost. Make a plan of publications by groups in social. networks, fill them with the first content and start to attract the audience to your groups.
Puzzled by accounts on large thematic resources. If your project, for example, from the sphere of finance, find a popular forum on finance, register on it, start communication, raise topics close to your project, so far without advertising. . ( — http://special.habrahabr.ru/hello_startup/habrahabr/ ) — http://spark.ru/ . 3-4 , . — .
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The general conclusion : software startups should engage in crowdfunding in the Russian-speaking environment, the main thing is to set priorities (not in favor of the goal of obtaining the necessary funding).
Hope this stuff was helpful. And of course good luck with your crowdfunding campaigns!
Kirill,
Project Manager Design and layout solution SketchBuilder
Source: https://habr.com/ru/post/237983/
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