Fund Your Haunted House With Crowd Funding

Posted by haunt educator on Jan 25, 2012 in Finance, Startup | 0 comments

Many haunted houses never open there doors and remain at the conception stage due to lack of funding. Here I am going to discuss a somewhat new and interesting method to raise funding for your haunted house. This method takes a collective teamwork type of approach. By networking and reaching out to people within that network who have pools of money and other resources to invest into businesses you are able to support your funding strategy. This method is normally internet based and there are several sites dedicated to this which I plan to cover in a later post. So onto the strategy I keep skirting around. Crowd funding also referred to as crowd financing and crowd sourced capital. An example of this is the campaigns you see after a natural disaster on say facebook or twitter where people are asking for donations for a fund to help the victims of the disaster.

So the way this works is you make use of various online communities to ask for small amounts of money to help fund your project. The people you are approaching with this are not your normal professional finance people like bankers and angel investors but people just like you who want to help someone out with a really awesome project. Some of the crowd funding sources out there are there to back a project with no returns offered for the investment and is more like a normal donation from a loyal fan or friend. Next you have crowd funding that you display sponsorship of the person or company that make the pledge of money for you. Another type is a threshold pledge where you give some kind of gift or reward for the different levels of donation. Then there are ones that work like a loan and some where they get a piece of the business or a return on the money invested.

What I want to focus on here is the threshold version where you set levels of pledges. So you can have a $10 level and a $50 level and you can just work it up from there. Then what you do is create gifts for those different levels. The lowest level being in this case $10 would receive a flyer or postcard promotional piece that is maybe signed by the monsters in the haunt. Then for the $50 level you could do the same thing but with a promotional poster. Since you are going to be printing these and using them anyway it does not take much to get some of the characters from the haunt to sign some postcards and posters that you will mail off. Now when you start getting up to the $100 and $500 and even $5000 ranges the gifts have to increase. These higher levels could include the lower level gifts and then maybe a t-shirt or hat. For mid ranges maybe you set a limit of 4 for a level and those pledges get to come in and act in the haunt for a night. With the super high level like $5000 or more maybe you fly them out for the weekend and put them up in a local hotel and give them VIP treatment at the haunt for a night. Then in return you get cash to fund your haunted house.

At this point this might not seem like a good idea but it comes down to a numbers game. Say you have 5000 friends on facebook and then have a facebook business page for your haunted house with 500 likes and what if you have a linkedin account and a twitter account with a couple hundred more. Well now you setup your crowd funding campaign and then share it with all these people on top of the people that are already members of the funding site. Now you looking at around 10,000 potential investors. Say 25% of them will donate at some level so you have 2500 investors. Even at the low level of $10 you will pull in $25,000. What if you had half of them donating $50 or more then you looking at a minimum of $75,000. See where this is going now. Then what if you requested or asked each of your social media account friends to share this campaign with all their friends now your extending your reach even further and instead of 10,000 potential maybe it just jumped up to 15,000.

Now I may be making this sound some what easy and let me tell you it is not. It is a simple way of raising the money but keep this in mind. You need to get the campaign out there and to all the potential investors, if you do not share it and do not have a established and loyal following then you will have to work even harder. With a established following what happens if you get 2000 investors or even 500 investors? That is a lot of signing of postcards and posters or a lot of t-shirts even. Yes you will have the money but you will have a lot of work to do also.

Money is never free but there are some new and very creative ways of raising it now a days. By using crowd funding you can raise the money to start your haunted house or keep its location. I have seen movies, books and even theaters created using crowd funding. I personally have plans to do a web series using crowd funding. Next week I will cover a site called Kickstarter and show some examples of crowd funding and you will be able to get some ideas of what can be done with this. Head over and browse that site if your interested and can not wait.