The 2014 Sochi Olympics were a watershed moment in sports crowdfunding. Numerous athletes used a variety of platforms to get the funding they needed to participate in the games. One story that truly resonated with people was that of Larisa Yurkiw. In 2010, she suffered a serious crash preventing her from participating in that year’s Vancouver Olympics. After two years of rehabilitation and training, she was able to earn a spot but needed to pay $20,000 in fees if she wanted to compete. Through the sports-oriented platform Pursu.it, she managed to raise over $22,000 and went on to achieve her dreams.
More athletes than ever are now following Yurkiw’s example embracing crowdfunding sites. Before you launch your campaign, however, be sure to be aware of the most common risks and ways to avoid them.
1) Protect Your Account
Crowdfunding websites contain a huge amount of information about both campaign organizers and backers. Addresses, email accounts, links to social media, and payment options are readily available through the campaign page. For this reason, be sure to utilize strong passwords and two-step verification.
In addition, limit the number of people who have access to admin settings on the campaign. Fortunately, most platforms have tiered access levels, so you assign roles accordingly. Likewise, be careful where you access your campaign. If you are using public WiFi, make sure you use a VPN to protect your network connection and prevent hackers from stealing personal information.
2) Check Your Tax and Other Laws
Nobody wants an audit. However, many people who organize crowdfunding campaigns don’t realize that the money they raise is typically subject to taxation. Since this money is very public, it’s easy for anybody to track. There are legal ways to get around paying the taxes such as through deductions or reporting it as a charitable donation and other steps. However, if you fail to declare the income, you could face an investigation by the IRS.
3) Understand Your Cash Flow
For athletes who have been struggling to raise money, the sudden influx of cash may seem like winning the lottery. However, it’s essential to remember that crowdfunding transactions happen one time and most campaigns last a maximum of 60 days. It’s important to balance this new cash with your long-term plans. This doesn’t mean you can’t use it to get essential equipment or other things you need, just be sure you budget exactly where it is going.
Make sure you also securely transfer the money between the platform and your bank account. Any time you initiate an exchange, it’s best to use a VPN to keep your personal data safe.
4) Crowdfunding Is a Full-Time Job
Creating a successful crowdfunding campaign takes time, money, and a lot of effort. Look at some of the most successful campaigns. They usually have excellent videos, are detailed, and offer some great perks. All of this can get expensive quickly.
Nowadays, there are even professional crowdfunding companies that can do all this for you, but they are very costly. Balancing between practice and the campaign can be difficult. Ask your friends and family to be your support team.
5) Create a Backup Plan
Between 70-89% of all crowdfunding projects fail to reach their funding goals. So what do you do now? The best way to think of crowdfunding is additional funds. You shouldn’t rely on it as your only option because if your campaign fails to go viral, you’re very likely not to hit your target. Instead, look into other means of supporting yourself. This might be picking up an extra job, getting a loan, or asking friends and family members for help.
6) Choose a Platform Based on Security
Many athletes turn to niche crowdfunding sites. However, it’s more important to use a secure platform than one tailored for athletes. It doesn’t matter which site you choose as a host. Ultimately, you’ll do most of the advertising for your campaign yourself through social media, emails, and other means. Instead, focus on digital safety.
Your priority should be finding websites with high-security protocols. Second, make sure everything you do online is safe. It’s easy for you to visit an infected website or download malware, which could then make your crowdfunding account vulnerable. Thus, protect yourself through a VPN during all of your internet activity. This will ensure your fundraising earnings stay where they belong—with you.
How to Run a Successful Sports Crowdfunding Campaign
Crowdfunding is one of the best ways for athletes to raise money and reach their goals. Although it can be difficult, with the right preparation, it is possible to find enough backers and succeed. Be sure to know your local laws and regulations and commit yourself to make the most out of your campaign. Finally, always take precautions to ensure your account and internet connection are safe. Now you have everything you need to go out there and reach your funding goals.