Raising funds for your business can be a tiring and sometimes unsuccessful journey. Traditional lenders often have strict criteria for lending that can be a barrier for anyone without collateral. If you need funding for your business but you don’t have collateral to put up, you should consider crowdfunding.
Crowdfunding is a funding method that involves raising funds through the support of your own network (friends, family, customers etc), an online network and potential business investors. You can use the money from crowdfunding for anything from expansion, paying salaries and buying stock.
There are many crowdfunding platforms in South Africa. From the Angel Investment Network to ThundaFund. For this article, we are going to look at the American-based platform GoFundMe.
What is GoFundMe?
GoFundMe was launched in 2020. In its early development, GoFundMe was a dedicated fundraising platform designed to get people to help each other out. In 2022, the company bought Classy which allows non-profit organisations to maximise their project impact using a suite of online fundraising tools.
According to the GoFundMe website, over $30 billion has been raised on the platform since 2010. The platform has a range of fundraising categories that your business can fall under. These include medical, emergency, education, charity and business.
How Does Fundraising on GoFundMe Work?
Much like other crowdfunding platforms, GoFundMe allows you to create a profile on your website and using your profile link, people can donate to your cause. Using your link, you can also market your crowdfunding initiative on social media, through posters or letters as well as big companies.
The fundraising you do on GoFundMe can be used for anything you need such as starting your business, expanding, buying extra inventory or even funding your marketing strategy.
How To Sign-up for GoFundMe
To begin advertising your crowdfunding needs on GoFundMe, you will need to follow a few steps.
Step 1: Set up your fundraiser
The first step to do when setting up your fundraiser is to click the ‘Start a GoFundMe’ link. From there you will be asked to answer a few questions before you can proceed. Next, add a photo or video that explains why you are raising funds. The picture or video doesn’t have to stay the same, you can change it at any moment.
Once you have provided the above-mentioned details, you will have to create a description for your fundraising campaign. This description should explain why you are looking for funds and should be between 1-3 paragraphs.
Lastly, you will need to set your fundraising goal. This goal is essentially the amount of money you are looking for. This ‘goal’ will be displayed on your profile, and you can change it at any time.
Note: GoFundMe does have a transaction fee for any fundraiser which is set at 2,9% plus $0,30 per donation.
Step 2: Share your fundraiser link
Once your profile has been set up, you will have a link that goes directly to your profile. You can share your fundraiser link with anyone including friends, family, and other potential investors. Additionally, you can post your link on social media pages or share it in person on a printable poster.
GoFundMe also has an option where you can add team members to your profile who can also share the link to your fundraiser.
Step 3: Set up your bank transfers
This is the fun part because you will now be setting up your bank transfers. In countries like America, GoFundMe deposits any donations directly to the receiver. For countries like South Africa, you will need to ensure that the donations are sent directly into your bank account. It is also up to the donor to ensure that the funds reach the receiver.
GoFundMe suggests that if you’re in South Africa, you need to state in your fundraiser story that any funds need to be sent directly to you.
Step 4: Update your fundraiser profile regularly
You need to regularly update your fundraising journey. By posting fundraiser updates, you will increase your chances of receiving funding and keep your donors informed of the journey. Through the GoFundMe fundraising dashboard, you can send messages to your donors to thank them directly for their contributions.
By following these four steps, you will be able to begin raising funds through GoFundMe. The platform is great if you want to find possible donors that are outside of South Africa. Additionally, the platform can help expose your business to potential investors.
Set up your GoFundMe profile today! And get the funding you need to start or manage or grow your small business.
For more information on crowdfunding, take a look at the brand reviews we have available.Â
