Crowdfunding for Business – How Your Car Wash Can Benefit
Accessing finance is one of the biggest challenges that go with starting a car wash business, growing your existing business, or launching a new product or project. As entrepreneurs seek out different ways to get financing, crowdfunding for business purposes is becoming an attractive option. The rise of internet usage is contributing to rising crowdfunding success. There are now hundreds of platforms available to help you gain crowd-supported financing. For example, Kickstarter is a crowdfunding platform. Statistics show that 4.9 billion US dollars pledged on Kickstarter have already been invested in successfully launched projects. The global crowdfunding market is expected to grow at a CAGR of over 16% during 2020-2025.
The most popular crowdfunding sectors are gaming and technology. More creative projects relating to design and tech, movies, music and publishing are also popular. However, the key to crowdfunding success is having a really great idea regardless of industry or sector. Read on to discover the different ways crowdfunding for business can benefit your car wash.
5 Ways Your Car Wash Can Benefit from a Crowdfunding for Business Campaign
Crowdfunding is described as raising money from a large group of people who each contribute a small amount. This money can be used to fund a good cause or business purposes. You can ask your family, friends, colleagues, the local community or potential customers to invest their money to help get your new business off the ground, or maybe use the funding for other business-related projects such as development. There are various types of crowdfunding for business, such as equity crowdfunding and rewards-based crowdfunding.
The main advantage of this kind of alternative financing is that you can start crowdfunding for business with the click of a button via an online crowdfunding platform. If there are enough interested investors, there is the potential to raise a lot of money in a short space of time. On average, a crowdfunding campaign lasts around 9 weeks.
1. Crowdfunding to Raise Money to Start Your Car Wash Business
Do you need to raise funds to open your car wash business? There are many different ways to secure financing including crowdfunding for business startups. However, crowdfunding does tend to favor creative projects built on inspirational ideas. Therefore, you will need to convince investors that you intend to open a car wash with a difference. It is important to set out your goals. For example:
- Can your business change lives? If you are planning to open a car wash in an area of high unemployment, people may want to support your mission.
- Will your car wash make a positive impact on the local community?
- Does your car wash focus on sustainability or eco-friendly technology? Perhaps your intentions are to open a green car wash that is better for the environment.
- Do you intend to use innovative technology that will benefit the customer?
- Do you have a personal story behind your car wash idea that will make people pledge funds?
You need to identify the unique benefit of your car wash business. Is it enough to make people want to pledge money to your cause? An equity crowdfunding platform such as Wefunder will help to connect you with investors online. Do you want to hand over shares in your car wash? If this idea doesn’t appeal to you, it might be possible to secure funding through a franchisor loan. Alternatively, if you have enough money in your retirement account, rollover for business startups financing is another option to consider.
2. Get Funding to Launch a New Product to Benefit Your Car Wash Business
Do you have a great idea for a new product that could benefit your car wash business? Crowdfunding for business might seem like a daunting prospect but it has the potential to be very successful if you can generate a lot of excitement around a new product. Reward-based crowdfunding is often associated with this business-related venture. How does it work? Simply put, you offer your project-backers a reward in return for pledges. According to key market trends, reward-based crowdfunding is expected to grow significantly. You don’t need to give away shares in your car wash with this approach.
Another advantage of crowdfunding for business when launching a new product or service is exposure. Online crowdfunding platforms can also double as marketing campaigns for your new product. You will get an idea of whether this product has potential or not. If no one wants to pledge money, it is a strong indication that you might need to rethink your product.
However, the downside to using crowdfunding for business to bring a new product to market is that your competition knows exactly what you are up to and could easily steal your idea. Therefore, it is very important to protect your new product with a patent before you start crowdfunding. If you prefer to explore more traditional methods of raising finance, look into how to get a corporate loan.
3. Use Crowdfunding to Invest in New Car Wash Technology
You may have been researching and testing new technology that will enhance the productivity of your car wash. The next stage is to attract investors via a crowdfunding for business platform. Focus on the key selling point of your technology. For example, it is an energy-saving piece of car wash equipment? Or perhaps it is water-saving technology that will attract funding from people who want to see more green businesses in the world.
Technology and innovation attract a great deal of crowdfunding attention. Crowdfunding platform Indiegogo supports tech innovation projects. If you have a clever piece of car wash technology you want to share with the world, crowdfunding for business could help get your prototype to market in the fastest possible time.
The downside to any crowdfunding campaign is that a failed fundraising project can hurt the reputation of your business. So you need to be sure that your car wash technology can deliver what you promise. Before you commit to a crowdfunding campaign, it is worth checking out what other professional financing services have to offer.
4. Crowdfunding for Business Expansion
Do you need extra funding to grow your business? Again, you will need to convince people that your business is different from other carwash competition and worthy of their investments. Make a connection. Tell your story. Share your exciting plans for business expansion to get people intrigued and interested. Above all, choose the most appropriate crowdfunding platform. Search for business-specific crowdfunding platforms, such as Fundable. It is dedicated to helping small businesses raise capital.
5. Raise Funds for a Professional Rebrand
Is it time for a change? Do you want to modernize your car wash image to attract new customers and get ahead of the competition? If you think your car wash could benefit from a professional rebrand, crowdfunding for business improvements like this is worth a consideration. Write your campaign and outline your business plans to introduce a new logo, refresh your brand message, website and so on.
The money you raise through crowdfunding for business ventures can only be used for the purposes specified at the outset of your fundraising campaign. For example, you can’t tell people you are raising money for a rebrand and then decide at the last minute you’d rather invest the capital in new machinery or somewhere else in the business. Be clear about your intentions from the start and be sure to stick to them.
Crowdfunding for business is popular because you can raise money much faster than, for example, taking out a traditional bank loan or trying to secure an SBA loan for franchise. In the competitive business world, there is no time to lose. However, be very clear about what your crowdfunding is for. Additionally, protect new product ideas or technology innovations with a patent before you use a crowdfunding platform. Also, due diligence is important. Be sure to check the platform fee. What percentage of the money you raise will be handed over to the crowdfunding site?
Financing a startup car wash business or introducing new product lines can be a complex process, especially if you have no experience in raising capital or applying for loans. However, there is expert help and support available if you decide to open a car wash as a franchisee. Check the DetailXPerts franchise opportunity – we help our candidates get the financing to fund their franchise cost and continue to provide support throughout the venture.
Before you go, sign up for our franchise newsletter to keep up to date with the latest franchise news, advice and developments in the business world.