Nearly 80% of entrepreneurs use their own savings to fund their small business. The truth is that most startups have few chances to attract investors. A simple way to raise startup capital is to launch a fundraising campaign. In fact, you can get a constant stream of fundraising ideas from the competition and use them as a starting point to grow your venture.
Are You Watching Your Competitors?
Remember the old saying, "Keep your friends close and your enemies closer?" It applies to business too. The moment you start a business, you will face some sort of competition, but this isn't necessarily a bad thing. In fact, it shows that your products are in demand and may help you gain a better understanding of your target market.
As an entrepreneur or small-business owner, you can learn valuable lessons from your competitors. It's enough to look at their websites, read their reviews, see where and how they advertise and what they do best. By analyzing their strengths and weaknesses, you can develop a more effective strategy and succeed where they fail. Plus, you will be better prepared for unwelcome surprises and can anticipate any issues that may keep your business from reaching its goals.
The information you get from your competitors can help you make data-driven decisions and improve your overall strategy. For example, you can check how customers feel about other brands and use their comments on social media to develop better products and fine-tune your marketing plan. If your website isn't getting enough traffic, check your competitors' websites to see which pages attract the most visitors and then post content on similar topics.
A company that sells fitness equipment for home use may begin to offer transportation and assembly services if its competitors don't offer these perks. If you're unsure whether you should raise or drop your prices, check your competitors to see what they do and how it works for them. You may also keep an eye on other businesses in your niche to gain insights on your target market, find potential leads and stay on top of the latest industry trends.
Get to Know Your Competitors
Before going any further, make sure you know your competitors. Since your goal is to raise funds for your small business, focus on startups rather than industry giants. Competitors can be divided into three categories:
- Direct competitors, which offer the same products or services to the same target customers in the same area as you
- Indirect competitors, which sell similar products or target a slightly different audience in the same geographical area as your business
- Substitute competitors, which target the same customers as you and offer products or services that could be used as a substitute for yours
As a small-business owner, your competitors are both your fellow entrepreneurs and the corporate giants. A software-development company that appeals to accountants, for instance, competes against both small businesses specializing in accounting software solutions and big software companies like Intuit or FreshBooks.
If, say, you sell computer games for children, your direct competitors are other companies that offer the same types of products to the same audience. Your indirect competitors, on the other hand, are companies that specialize in video games or mobile games for children. Substitute competitors, or phantom competitors, may include businesses offering board games for kids.
Draw Fundraising Ideas From the Competition
The Dalai Lama once said, "Your enemy can be your best teacher." As an entrepreneur, you can gain valuable insights from the competition. Generally, it's recommended to focus on the factors that could make customers choose one company over another. These include product quality, service and price.
As far as fundraising goes, you can draw inspiration from your competitors and emulate ideas without "stealing" them. Look for other companies that have gone through similar struggles as you. For example, International Animal Rescue leverages the power of storytelling to raise funds for animals in need. The organization's website features compelling stories, videos and photos of each animal to encourage donations.
The Canadian Spinal Research Organization joined forces with Johnson & Johnson to organize a hockey tournament and raise awareness for neurotrauma research. You can do the same. If, say, you're planning to launch a new type of protein powder, you may organize a local sports event or start a crowdfunding campaign to raise money. A small local restaurant, on the other hand, can partner with a winery and organize wine-tasting events to raise funds and increase brand awareness.
If you own a photography studio, encourage your employees to take funny photos of themselves and then place them on a bulletin board in a popular area. Create a compelling call to action to encourage visitors to vote for the funniest photo and make a small donation.
Need more ideas? Check your competitors. Try to find out how other photographers, local restaurants and other small businesses raise money for their projects. Something as simple as running a photo contest on the street, charging a small entrance fee for seminars and workshops or hosting a karaoke night in your pub can yield big rewards.
Crack Their Digital Marketing Strategy
One way to draw inspiration from your competitors is to monitor their websites, blogs and social media pages. This way, you can get a feel for how they attract and engage potential donors or customers online, what they do best and what could be improved. Start with their blog — check what they are writing, which posts get the most traffic and the length of the posts. See the comments left by their readers as well as the number of social media shares.
Use your competitors' content as inspiration to create something better. Approach the same topic or similar topics but from a different perspective. Focus on developing your own brand voice. Use online tools like Ahrefs and Google Trends to see what topics are in and which of your competitors got the most coverage.
Another factor you should consider is their backlink profile. A backlink is a link from a website or blog to another website. For example, if your competitors launch a fundraising campaign and write about it on their website, you can use Ahrefs, Backlink Watch, SEMrush and other online tools to see who is linking to their page and from where their traffic is coming. When you launch a similar event, try to get backlinks to the campaign page from the same sources (and others).
Next, check your competitors' social media pages. Take Facebook, for example: How often do they publish content, and how many likes do they get for each post on average? What are their fans saying? Also, try to find out whether your competitors use Facebook ads or rely on organic reach.
Analyze Their Email Marketing Strategy
More than 293 billion emails were sent and received each day in 2019. This number is expected to reach or exceed 347.3 billion over the next three years. Companies that use this marketing channel have an average return on investment of $42 for every $1 spent. Therefore, it makes sense to use email marketing to grow your business, raise funds or gain exposure.
Once again, your competitors may help. Sign up on their websites and subscribe to their email lists or newsletters so that you receive messages from them. Next, pay close attention to the frequency of emails, their writing style and tone and their content.
By subscribing to your competitors' email list, you'll be among the first to know about their latest fundraising events. This will allow you to anticipate their next move and do things better. For example, if your competitor is hosting a karaoke night, you could organize a battle of the bands instead. It's a lot more exciting and can be a great opportunity to promote local artists and raise funds for your small business.
Sign Up for Google Alerts
Consider using Google Alerts to find out what your competition is up to. This free service enables users to receive notifications when recent news, blog posts, articles and other types of content containing specific search terms go live online. The notifications are sent directly to your inbox daily, weekly or monthly depending on your preferences.
Say you want to keep track of a fundraising event hosted by your primary competitor. Sign up for Google Alerts and enter the event name in the designated box. Whenever a website or online magazine mentions that particular event, you will be notified by email. With this information, you can capitalize on your competitor's weaknesses and develop more effective campaigns.
Similarly, you may use Google Alerts to get notified whenever your competitors' names and products are mentioned online. It's also a good way to stay on top of the latest industry trends and developments. Just remember to put quotation marks around your search term or phrase for more accurate results.
Build PR Relationships
One of the best ways to promote a fundraising campaign is to send out press releases and get mentioned in the media. However, if you're just starting out, you may not have enough contacts. While there are plenty of journalists and media outlets, the real challenge is finding those that want to write about your next event.
Why send hundreds of emails and make countless phone calls when you can leverage your competitors' strengths? Mention, for example, is an online service that notifies users whenever their competitors' names show up in the media. You can see all the journalists covering them and then create a PR media list for your small business.
Another great resource is Ahrefs. With this service, you can discover and analyze top-performing content in your niche and then contact the writers or journalists behind it. This way, you will know exactly who is mentioning your competitors and how their fundraising efforts are perceived by the public.
These are just a few of the many ways to draw ideas for raising money from the competition. The more you know about the companies with which you're competing, the better you'll be able to maximize your reach. Don't steal their ideas, though. Instead, let them inspire you to identify market opportunities and get the most out of your fundraising event.
To get your mind flowing, here are some typical fundraising ideas — which fundraiser makes sense for your business and its place among competitors? These family-friendly event ideas are commonly used to raise a lot of money. You can even partner with community members and local businesses.
- Bake sale
- Talent show
- Trivia night
- Haunted house
- Fashion show
- Book sale
- Halloween/Christmas/holiday party
- Golf tournament
- Silent auction
- Yard sale
- Car wash
- Set up a fundraising page
- Obstacle course
- Chili cook-off
- Movie night
- Parking lot tailgate/barbeque
- Pot luck
- Game night
- Scavenger hunt (with entry fee)
- Donation page
- Ice cream social
- Sell t-shirts
- Local bar hop
- Auction items
- Team members in a dunk tank
- Raffle tickets with small prizes
- Friendly competition (contestants pay small fee for entry)
- Partner with and sell tickets to local sports teams games
- Fundera: Raising Capital for Startups: 8 Statistics That Will Surprise You
- Boston Digital: How Do You Stack Up? Competitor Analysis
- FundRazr: 5 Inspirational Nonprofits You Can Learn From
- Statista: Number of Sent and Received E-Mails per Day Worldwide From 2017 to 2023
- Data & Marketing Association: Marketer Email Tracker 2019
- Forbes: 3 Ways to Spy on Your Competitors - and Why You Need to Start Doing It Now
- SmartBug: How Important Are Your Competitors? What to Watch and What to Forget
- Entrepreneur: 10 Smart Ways to Earn or Build Backlinks to Your Website