I find crowd funding strategies similar to gallery shows in the fine art world.
Many times artists believe all they need to do to sell art is find representation in a gallery. There is a misperception that the gallery will have shows, exhibiting their work and the public will swarm to buy their art.
What the artists do not consider and startup organizations overlook in crowd funding, is the fact that business is still about sales. Whether your platform is digital or venue is brick and mortar, it still requires creating a product or service which people want or need, and promoting/advertising to drive interested buyers to your product/idea/concept/service.
Crowd funding sites provide a platform where many, many people could view their concept; but, there still must be an incentive, a connection, a reason/mission which inspires potential investors to contribute money. The video can be well produced, and verbiage well written, but the fact remains that the mission must inspire people to give. The concept must stand out as unique and something worthy of investing in.
An art gallery is designed to exhibit the art in the best light and potential buyers are invited/enticed to attend showings and purchase art. It requires sales, marketing, promotions, branding and even customer development. A successful gallery will develop an active list of people who buy art, noting the type art they buy. Then, the gallery will seek artists who create work which will appeal to their clientele. Their customer list is constantly growing, and continually be massaged to provide a unique service to a very specific demographic. The crowd funding sites are designed to showcase concepts and provide a way investors can contribute to very wide, undeveloped audience. What these sites do not provide is customer development, sales, promotions or a forum that can turn a mediocre, uninspired concept into a million dollar idea. Crowd funding sites expect the individual users to develop their own clients and promote their own concepts to ensure the greatest success.
Artist produce work often without a buyer, audience or even venue to sell their work. Entrepreneurs might be equally optimistic and blind to the importance of conventional business practices as they flock to crowd funding sites in hopes of funding their ideas and dreams.
There’s nothing magical about sales of art or funding of projects on crowd funding sites. The fact is it requires as much work and dedicated attention as creating the art or developing the concepts. For those who blindly jump into either endeavor, the numbers for business failures and starving artists is staggering, but certainly not surprising. It’s a reminder that many artist and entrepreneurs rely heavily on the misconceptions of business in their zeal to create.