Crowdfunding is a multi-billion dollar industry. So there’s really no question about it: people will want part of that pie.
Once you even remotely signal to the internet world that you might be launching a Kickstarter or Indiegogo campaign, you will get bombarded with emails, messages, or ads. If you’re lucky, you’ll be hit with the trifecta (sarcasm fully intended). After running countless crowdfunding projects, I’ve even experienced a lot of it myself.
Below are some examples of the crowdfunding scams you might see, and a no-BS tell-all if it “works”.
Crowdfunding Scam #1: Backer Email Lists
Almost every single person I’ve talked to who will run or is running a crowdfunding campaign has seen this. A message will appear in their inbox claiming a huge list of emails of crowdfunding backers all at a price that is incredibly palatable.
The truth is, those emails are probably real backer emails from real projects. There’s been enough “leaks” going around now that backer emails really aren’t safe anymore.
At this point, your mind might kick into overdrive: “well, since I have to get emails for my launch, why can’t I just buy them and get it over with?”
Two reasons:
1. Your own audience is the best audience.
Think of it this way: if Head & Shoulders has been tirelessly creating a large email list, then McDonald’s sneakily decides to email that list, what will happen?
Firstly, people will be confused – why am I getting an email from McDonald’s in the first place? They’ll probably mark the email as Spam, delete the email or not even open it in the first place.
Bottom line is this: the Head & Shoulders audience won’t care about what McDonald’s has to say since they weren’t interested in the first place.
When it comes to crowdfunding, your own audience is the best audience. You’ve captured their attention with your project and they’ve already started trusting you by providing their email. They’re much more likely to take note of what you’re doing, be more keen to read your emails, and understand where your project is going.
2. With email privacy laws, you’ll probably be immediately shut down.
This one is pretty easy to understand. The issue of online privacy has always been a hot debate. With a lot of tension on this issue, using an email that isn’t yours to use can get you in a lot of trouble.
Does it work?
The final verdict is yes, it does work – but only to an extent, but with many caveats.
Let’s be clear here: I don’t recommend anyone going out to purchase email lists.
But I’ve been in this industry long enough to not be naive; I know some of you will. If you do end up purchasing email lists off a stranger on the internet, do so with caution.
Create workarounds that don’t implicate your main domain name. Don’t be foolish enough to upload those lists directly into the same email service provider you’re using for your own (real) email list because the service provider will probably disown you. Don’t be foolish enough to flaunt that you have purchased an email list. Don’t be foolish email to send direct emails to them right off the bat and hard-sell your project.
Crowdfunding Scam #2: Promotion Help
Sometimes people will reach out to you and tell you that they’ll “promote your project” for you. They’ll tell you that they have access to many different channels that have a lot of crowdfunding backers. What happens here is that they’ll literally go out and bombard these different groups, pages and forums with a short blurb about your project and a link to it.
Does it work?
Not really. They’ll easily satisfy your initial agreement by posting about your project in many channels, groups, forums and such. But a lot of the time, nothing ever happens.
Why? Because there’s no connection between the people reading your posts and your project and mission so it doesn’t move the needle.
Sure, more people might see that your project is live, but there’s absolutely no urgency or drive for them to actually click on the campaign page and convert into a backer. The people who back your project usually have a connection to you, your story, or care about your product in some way.
Blasting your message out to different social channels is like putting up flyers on the road. A lot of people will walk right by it, many people might briefly read it, some might be a little interested, but even fewer will be driven to act.
In the end, a lot of these groups end up being a place where people just go and beg for money so others stop listening.
Crowdfunding Scam #3: A Written Project Review
As a content creator with a fanbase, a writer’s job is to continue bringing interesting news to their readers. Some people might come into your inbox to offer to do a writeup for your project and put it on their page. That’s great news and you’re the lucky few who have people reaching out to you! It’s pretty much free publicity for your campaign.
Keep in mind though, that a lot of the time a review or writeup will just be a regurgitation of what you already have your project page. The way they’ll continue to please their fanbase is to churn out as many of these articles as possible, and what better way than to use what already exists. Sometimes, the writer does go the extra mile by doing an interview with you or putting some fresh thought and insight into their article.
Does it work?
The next question is whether a writeup works to convert an audience. If they already have an audience that is interested in what you’re offering (i.e. people in the same niche), then a review can definitely work. However, if it’s a writeup for a channel that doesn’t relate very closely with what you’re offering, then usually it will be a bust in terms of converting people into backers.
At the end of the day, though, it’ll give you another “badge of honor” for your project that you can plop into the “media & press” section of your campaign.
Crowdfunding Scam #4: Newsletter Blasts
There are a lot of companies that spend a lot of money to accumulate a list of crowdfunding enthusiasts. Since so many people are repeat backers on crowdfunding, it’s not too far off to think that sending them another crowdfunding project will get them to back again.
Needless to say, these companies have turned around and commoditized every email subscriber. By getting you to pay for them to send emails to the list, that email list becomes very valuable (see point 1). There are different tiers of emails from “round-up” type emails where you sit with many others also vying for attention to “dedicated email blasts” focused solely on your project. No matter what type of promotion, there will be a price.
Does it work?
This can work, but with two caveats. You must bring your own successes to the campaign first. What this means is that these newsletters can’t be the “hail Mary” act at the end of your project that miraculously saves your campaign. It won’t take a campaign from $0 to $100,000 overnight. You must be diligent enough beforehand to build an email list, build social proof, get funded, get noticed and more before pushing this type of traffic to your page.
Second, keep in mind that the effectiveness of these newsletter blasts can vary depending on your project and the audience from each company.
I recently worked with an entrepreneur who said a certain “Backer” newsletter (there are enough “Backer” companies out there that this is enough to mask which company it is) was “completely trash”. All because an email only brought in 1 backer for their campaign, even though they were already funded. I would also be miffed, but this comes just one day after another founder told me that the same company newsletter brought in 30 new backers.
So yes, although something like this can work, there is no “magic fix” and no “one-size-fits-all”. I would recommend asking questions to understand more about the audience of a list if similar projects have been promoted before, and how those similar projects did in terms of attracting backers.
Crowdfunding Scam #5: Social Media Promotion
You’ll get people storming your inbox saying that they can promote your project to their 5,000 followers on Instagram or 7,500 followers on Twitter. Be wary of this.
Some of those who reach out to you might have many followers, but know that there are a lot of tools to build up a fake following.
Moreover, social media is never the strongest leverage point for a crowdfunding campaign. Yes, it’s there and incredible for driving awareness of your project and keeping people updated on your plans, but it’s never truly the direct driver for success. The core drivers of success are usually friends/family (your network), an email list of enthusiastic fans (from the pre-launch phase) and paid advertising (should you choose to go that route).
Does it work?
Sometimes. And if so, it works very minimally. Be sure to create tracking links for each one so you know if there are any returns from that source. If there are people backing from that promotional source, then you’ve struck gold for your campaign and should keep going.
Watch Out For Crowdfunding Scams
Before I send you off into the real world, the best advice I can give you is this: if it seems too good to be true, it probably isn’t.
Ultimately, the best way to get your project 100% funded is to follow the tested blueprint for success (there’s a reason it’s helped me help others raise over $13M) and give it your all.
