Unsurety Associated with Crowdfunding Consultants

Ruth Simon reported last week at The Wall Street Journal Online that, “The first time Sami Gros tried to raise money through a Kickstarter campaign, she failed.

“So for her second attempt two years later in 2015, Ms. Gros paid several firms about $2,300 to help generate publicity for her California-based business, which makes safety lights for horses. The campaign raised $47,000 for Tail Lights Inc., but Ms. Gros remains unsure whether the money for publicity was well spent.”

The article stated that, “As more entrepreneurs turn to online sites such as Kickstarter and Indiegogo Inc. for fundraising, a cottage industry of service providers has emerged, promising assistance with everything from strategy and publicity, to communication and logistics.”

Ms. Simon explained that, “Some services cost less than $100, while others take 30% or more of revenue, which could add up to $100,000 or more for successful fundraising ventures. Figuring out which services are worth the money isn’t easy, campaign organizers say;” and added that: “A Kickstarter spokesman said most projects on its site ‘don’t need the external support of promotional consultants or marketing services.'”

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