4 Crowdfunding Mistakes Nonprofits Make (and How to Avoid Them)

While the efficacy of crowdfunding has been debated since its creation, it’s certainly one of the newest ways that nonprofits have been able to generate revenue in the last decade or so. It’s undeniably fast and when done well, it creates a low-friction way to drive additional dollars to your mission. However, while numerous organizations launch crowdfunding campaigns with high hopes, many (if not most) tend to fall short of their goals. This isn’t because their mission isn’t worthwhile or that people don’t care, but because of some avoidable missteps. Here are four of the most common crowdfunding mistakes nonprofits make and how you can steer clear of them.

1. Treating Crowdfunding Like Just Another Donation Page

Someone throwing up a generic donation form with no real project or vision on GoFundMe and calling it “crowdfunding”, and then being confused as to why they’ve raised no money is far, far more common than you think.

The truth is that crowdfunding is its own unique format. Your page should feel dynamic, appropriately urgent, and above all: story-driven. Use a bold but accurate headline, visuals that support the story (avoid overly-generic stuff), a clear goal tracker, and updates throughout the campaign. Unlike a static donate page that may live on your website, a crowdfunding campaign should feel alive and participatory. If it feels like no one (including you) has been on your crowdfunding page in weeks or months, it’s going to feel stale and people will move on.

2. Making It All About the Money

Focusing solely on the fundraising target (“Help us raise $100,000!”) without showing why it even matters. We want to make sure we say this gently, but no one cares about your budget or financial goal in it of itself. They care about the downstream impact of what your budget actually allows you to do for who you serve.

Translate your goal into outcomes: “$100,000 provides a year’s worth of safe shelter” or “$25 funds a dental visit for a child in your community.” Tangible impact is far more motivating than a dollar amount alone. It’s even better if you can tell a specific story of how you served someone and how you can continue to better the lives for more of your constituents (privacy and HIPAA permitting).

3. Thinking that Crowdfunding is a Permanent State of Being

Treating crowdfunding as if it can run forever, expecting it to be a constant and permanent revenue stream is a fallacy. This is especially true for your smaller nonprofits that don’t have decades of program history and brand equity.

If you are going to do crowdfunding, you should design it to be to be short, intense, and time-bound. The nature of it is that it thrives on urgency and momentum, which you can only utilize for so long on a digital platform. When stretched out indefinitely, donors lose interest and your appeal will be lost to the ether of the algorithm. Instead, use crowdfunding strategically and sparingly for specific projects or moments in time. Celebrate your success for what it is after the crowdfunding campaign ends, and move donors into the next stage of engagement.

4. Only Hoping for the Best

Launching a crowdfunding campaign and waiting for donations to trickle in what we’ll call the “post and pray” method will probably disappoint you with the results. Simply posting your crowdfunding page once and just hoping people will discover it rarely leads to success. It’s an easy thing to think that because it’s online that crowdfunding isn’t a lot of work. The opposite is actually true though. Form the successful crowdfunding campaigns that we’ve seen, the amount of coordination and work that it takes to be successful can be tremendous.

Instead of relying on luck, create a push plan: schedule coordinated posts across email, social media, your website, and line up influential voices. That could be community leaders, board members, or even micro-influencers to share your campaign at key points in a single coordinated effort. Successful crowdfunding is about momentum, which does not normally get created out of thin air.

Crowdfunding is NOT a magic bullet and it should not be your primary revenue source. When done right though, it can be an addition to your fundraising toolkit in the right circumstance. Give your campaign the best chance to succeed and make sure you’re avoiding these common pitfalls.

Need help fundraising for your nonprofit organization? We have helped hundreds of nonprofits scale up their fundraising revenue! Send us a message and we would love to learn more about your nonprofit.