AFFILIATE CROWDFUNDING?

8 replies
Hey Warriors,

I have an Scenario to run by you IM experts. If you are familiar with sites such as Kickstarter.com, you know that Crowdfunding is hot in the tech world. For those of you unfamiliar with Crowdfunding, it is a way for startups and small projects to raise funds relatively quickly from people who back projects in amounts raining from $25 to the hundreds. There are target amounts that are raised and within a set period of time.

My question is, would any of you be interested in helping a project get funded and make a commission on every paid sponsor you bring in?
#affiliate #crowdfunding #marketing advice
  • Profile picture of the author Brains Gone Wild
    Sounds like an interesting idea. I'd check out the legality of it, though, as crowdfunding has become a very regulated vertical. Best of luck and keep me posted if/when you launch!
    Signature
    The 1st and Only Webinar Platform for Internet Marketers is here! Click here to create your account now!
    {{ DiscussionBoard.errors[7205849].message }}
  • Profile picture of the author Steve L
    I could see something like this taking off, but as "Brains" said, check the legality first.
    {{ DiscussionBoard.errors[7205863].message }}
  • Profile picture of the author ProAffiliate01
    This is the first time I heard of this. Can you explain further? This sounds like a group funding effort. Am I right?
    {{ DiscussionBoard.errors[7205987].message }}
    • Profile picture of the author lockinnow
      I think the challenge in Crowdfunding would be if the project actually got delivered after the funding goal was met. However, I would try it out with one of my projects first because A.) I actually wanted to put this on Kickstarter and B.) I really want to get this project done (it's an animated film that hasn't been completed).

      I like Kickstarter, but the problem is that I don't like the "All or Nothing" funding model. Let's say your projects goal was to reach $200,000 to fund a project. Even if you raised 90% of the money, if you don't hit 100% on the closing date of the project, you lose all the money you raised to date.

      The other problem with the Kickstarter model is that you're basically hoping that someone out there likes your project and the gifts for sponsorship enough and decides to fund it.

      I think that Affiliate Crowdfunding would be a better alternative as I know IM's are the ones that know how to get people to open their wallets if the product shows value.

      Sounds like an interesting idea. I'd check out the legality of it, though, as crowdfunding has become a very regulated vertical. Best of luck and keep me posted if/when you launch!
      By the way, I was checking and there is another site that has a commission plan for crowdfunding but it's only 10%. I think most IM's would want more than that to make it worth their while.

      If you were trying to raise $100,000 I believe it would be alot easier with an army of affiliates. If you had an affiliate who could bring you in a $100 sponsorship (not uncommon in Crowdfunding) and take a say 40% commission on the "product", the affiliate could earn $40 per sponsor and $60 would go to the project itself.

      It would take 1666.7 backers @ $100 to reach the fundraising goal. $66,670 would be paid in commissions. 1600+ is a very attainable number IMO, especially if the offer is good enough.

      I think what would be the hook would be allowing backers to also become affiliates so they can make money on a project they are helping to bring to reality. These may even be other IM's.

      There of course would be a couple challenges mostly on the project coordinators end such as delivery of sponsorship bonuses. That would have to be stated clearly in the project terms and conditions.

      The other of course would be how/when commissions would be paid. Would the project have to reach a certain percentage of funding before any commissions would be released? Keep in mind that this will still use the 30-60 day funding model.

      I'd really like to hear your opinions. I really think it's an untapped niche with alot of monetary potential, but I defiantly want to do it right.
      {{ DiscussionBoard.errors[7206088].message }}
    • Profile picture of the author lockinnow
      I think from the perspective of an "investor" the paid sponsor aspect would be something that would not be as desirable, where as the traditional "crowd sourcing model" the investor receives some tangible asset either in the form of software or hard goods.
      Hi,

      Sorry I didn't get to explain that earlier. There still would be tangible goods received by the "investor" which of course would still be the responsibility of the project coordinator.
      {{ DiscussionBoard.errors[7206091].message }}
      • Profile picture of the author CaribbeanNight
        i think your 'affiliates' would be acting as brokers of financial instruments, so this would be highly regulated by the SEC (if not outright illegal)
        {{ DiscussionBoard.errors[7206975].message }}
        • Profile picture of the author robdoby
          Affiliate crowdfunding payments (referral fees) are allowed but only for donation-based and reward-based campaigns & platforms.

          These projects are outside of the scope the SEC & FINRA, whose only jurisdiction is over securities offerings.

          Equity-based platforms (coming soon to sell stocks) CANNOT offer any inducement or referral fees and cannot even recommend a particular project or offering. These offerings must be unbiased, when finally allowed.
          Signature
          Robert Dobyns
          CEO - Conzortia Business Funding, Inc.
          Conzortia.com
          Join my LinkedIn Group of 2700+ marketers
          Ask me how I started a business with $100 and built it to $1.5 million in annual sales using crowdfunding.

          {{ DiscussionBoard.errors[7935349].message }}
  • Profile picture of the author Tim Franklin
    I think from the perspective of an "investor" the paid sponsor aspect would be something that would not be as desirable, where as the traditional "crowd sourcing model" the investor receives some tangible asset either in the form of software or hard goods.

    For example if say a programmer has a project that needs some publishing work and perhaps some finishing up on the product he or she might crowd source, with the idea that the members of the "team" would share in revenue in exchange for either funding or providing resources for the project.

    That to me would be a more attractive venture.
    Signature
    Software Development | Applications | OSX | iOS | Android | Cloud Software Engineering |
    {{ DiscussionBoard.errors[7206060].message }}

Trending Topics