If I Started Now: How To Raise $29,000 (The Art Of Asking For Money)

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This post is part of the If I Started Now series, which hands you the step–by–step blueprint on how to get started building a particular business.

If you heard about a young woman who raised $29,000 to support an idea she had, would you be interested in learning more about her story? Would you be interested in learning how you could do the same thing?

A few days ago, I spoke with my friend Sarah Peck. She’s in the middle of raising a boatload of money for a crazy idea.

Here’s what she did (and how you can do the same).

From Zero to $29,000

We all have a dream. A crazy idea. A cause that we believe in.

The only problem is, we often need money to make our dreams happen.

For Sarah Peck, she wants to make a difference in the lives of people who don’t have access to the things we often take for granted. For example, clean water. 800 million people on our planet don’t have access to safe, clean drinking water.

Sarah decided to do something about it.

On her 29th birthday, she will be swimming from Alcatraz to San Francisco with the hope of raising $29,000 for charity. Oh, and during the swim she’ll be wearing nothing. A birthday swim in her birthday suit.

How to Raise Money for Your Cause or Business

This is Sarah’s first time raising money for a cause, but with $15,000 in the bank she’s already more than halfway there. I asked her to share the lessons she has learned about raising money for a cause, a business, or otherwise.

Here’s what she had to say…

Tell a story.

Humans are natural–born storytellers. Jonathan Gottschall, in “The Stortyelling Animal,” writes that stories are what make us human: “We operate in worlds of make–believe, in fantasy, in novels and plays.” We love stories because they help us “navigate life’s complex social problems,” and also ensure our survival.

For your business or project, it’s not enough to have a decent project. We want to believe in what you’re offering and what you’re selling. Not just in your product, but in the story behind the product and what it can do for us. We want to see ourselves as the hero, the one that matters, the person that makes a difference.

In the $29,000 birthday swim, my story is one of thrill and excitement, one of daring and adventure. I’ve promised to do something scary and risky (swim from Alcatraz to San Francisco) in a brash and flashy way (naked!) if enough people rally behind the cause. People like to be a part of a great adventure. It’s easy for people to join in by pledging $29, and then they become part of the story.

In short, find a way to let people be a part of the story.

Your story is your business.

People give money to people, causes, and ideas that they believe in. Give them a story that they can believe in. Give them something that inspires and energizes them.

“If you want people to invest in your business, give them a story to get invested in. Your story is your business.”
Click here to Tweet this quote

Raising Money is Hard

It’s easy for someone to smile and tell you that what you’re doing is great. It’s easy for them to say they’ll help you out. But taking money out of their wallet? That’s hard.

But it’s not impossible. Here’s how Sarah is doing it every single day…

If you want to raise a lot of money, ask a lot of people. It’s a numbers game. There’s no substitute for traffic and eyes.

I need 1,000 people to chip in $29, which is a lot more than the average social network. In order to do this, I’m committed to asking every person I meet to donate, tweet, or share.

(When I first talked to James on the phone, the second thing I did was ask how I could have him help!)

Every time I get into a taxi or on a bus, I ask another person. Many of the people are intrigued, curious, and interested in helping.

Rule of thumb: You don’t get what you don’t ask for.

But what if you do muster up the courage to ask and the answer is no.

Then what?

Ask at least three times. It’s not just about asking once.

Think about the context in which people are receiving your messages and requests: on social media, not everyone sees the stories you post. In email, you don’t have control over the context of the recipient. Someone might get your message while traveling, on vacation, in motion, or otherwise busy. The first time people get your message, they might want to donate but aren’t able to go to the site at that exact minute.

Guess what doesn’t get pulled up in their to-do list later that day? Your project.

So? Ask again.

I sent out three emails, once a week, to my closest friends and another to my extended network. Each time you remind people who already wanted to participate that they still have a chance to help out.

People often feel like they are bothering others if they ask repeatedly. Well, there are some people that you are bothering. But not as many as you might think: it’s a numbers game. There’s a group of people that want to donate but forgot to the first time. They are the ones that you are reminding. Ask again, and then ask a third time.

Don’t be afraid to show up.

There’s another benefit to asking multiple times: The more you keep people in the loop about your project — updates, emails, social media, etc. — the more they feel like part of the story. Sure, they have more chances to donate, but even if they don’t, they might support in another way.

It’s a funny thing, but oftentimes the people you thought you were bothering with all of your updates will be some of the first people to congratulate you once you succeed. They were paying attention all along and your continual communication made them feel like they were part of the process.

“Most people give up after the first no. Don’t give up, and you won’t end up like most people.”
Click here to Tweet this quote

“But I Don’t Have a Big Network”

I won’t lie to you. Networks matter.

It will help you to know a lot of people. And it will help you to know the “right” people. That’s why you’ll often hear the advice, “Build a network before you need one.”

But here’s what “build a network before you need one” really means:

Start now.

Everyone starts small. In the beginning, we all have no resources, no contacts, and no experience. Get moving anyway. So you’re network is small today? Reach out to someone now and it will be bigger tomorrow.

Here’s Sarah’s approach…

The process of asking — and selling — is about reaching people who want what you have to offer. Setting up a stand and hoping people come is no way to run a business or a campaign. In the digital world, you’ve got to get as many eyes on your page as possible, and get the page in front of people who want to help out and are willing to participate in your project or need your product.

Build your network of like–minded thinkers as early as possible. Reach out to people. Challenge yourself to ask new faces, and use the project as a way to build your network. For me, I’ve used it as an excuse to meet more people, and to talk to people at lunch, on the bus, in cities, anywhere.

The more people I ask, the better I’ll do.

Throughout this whole campaign, my mantra has been:

“If you never ask, the answer is no.”

In other words, the best way to start is to skip all the planning and just start doing whatever it is you want to do.

Can I Trust You and What am I Getting for My Money?

These are the two questions that anyone has when they are asked to donate to a cause or business. Don’t leave the answers up to chance!

Demonstrate trustworthiness by showing how much you care and how much you have already sacrificed for the cause. Offer value by giving back to the donor. Here’s how Sarah does it:

Give them a reason to donate. Why do people open up their wallets? Offer incentives. It’s not enough to simply build a good product, service, or charity. A lot of people are motivated by what they get back, or how they feel when they donate. Sometimes a story or emotional feel–good is enough; often, however, you would be well served to reward them.

So, make them feel great! Tell them everything they get, and make your offer clear. I’m running a huge party and offering all sorts of prizes for donating.

Also, value is relative. One of the crazy things I noticed is how differently people will value certain products and offerings. Many people will squabble over a book costing $15 or $20 (something that the author may have put a years’ worth of work into), but they won’t think twice about dropping $50 for a dinner somewhere. Or $5,000 for a college course because the expectation and cultural norms suggest that that’s the right price.

Don’t always ask people to donate for the same reason. Run a party, ask businesses to match donations, give away prizes worth 3x more than the donation. Give people something so ridiculous that they can’t help but donate.

Be Grateful

The fact that anyone cares enough to help, support, or donate to your cause is a small miracle in itself. Don’t dismiss the effort that people are willing to provide — no matter how small.

And, as Sarah says below, thanking people can be strategic as well.

Thank people and thank them publicly.

Social proof is incredibly important. We want to know that other people are helping, too. We constantly check the behaviors of our peers to see if they are taking action. If they are, we’re more likely to. If we see a lot of people buying something, enthusiastically supporting, or we see something’s made a top-ten list, we are more inclined to donate.

Strategically, you can send out small sub-group messages to early supporters and ask them to contribute first. In Amazon book reviews or project referrals, this is your first target group.

In this case, the charity project, you can thank people, and thank them publically: write a note on their Facebook wall or link to them in the social spheres. Include them in posts. This shows their friends and networks what they’ve done and also extends your reach to a bigger audience.

What You Should Do Now

Go to Sarah’s charity:water page and help her raise $29,000 for clean water.

Then, use her insights to get people to donate to your own cause.

20 Responses to If I Started Now: How To Raise $29,000 (The Art Of Asking For Money)

  1. Ana says:

    Raising money for a cause and raising money for your for-profit business are 2 radically different activities with normally radically different outcomes. People so inclined will willingly give to a worthy cause like clean water, but what worldly incentive would they have to give money to your business just because you ask for it?

    Very few people — probably counted on one hand — can successfully raise money to start a business. You either have to have it already, get a personal loan or a business loan. There is no other way.

    • James Clear says:

      Ana — Thanks for your comments. Your thoughts are always welcome here.

      First, I’ll say that far more than a handful of people have raised money for their business. Every venture funded startup (there have been hundreds, if not thousands in this year alone) has done so.

      Second, and perhaps more importantly, I thought someone might bring up the “people will give to charity, but not a business” argument.

      In fact, you say specifically: “What worldly incentive would they have to give money to your business?”

      That’s an excellent question and it’s one I think every entrepreneur needs to think about.

      Here’s the answer: People give money to things they value. It doesn’t matter if you’re running a business or helping a charity. If people value what you do, then they’ll pay for it.

      What if you built a solar energy business that had technology that made solar energy as cost-efficient as fossil fuels? Do you think someone would fund that? You better believe it.

      If you’re finding it hard to raise money for your business, then give some thought to how valuable it really is. If you can show the right people that it’s valuable, then you should be able to find someone willing to fund your business.

      • Elhaje Asco says:

        Definitely agree with that comment of yours James, “People give money to things they value”.

        That’s exactly what happened to Sam Ovens.

        He researched a niche, found problems that could be solved through softwares and made people pay for it before he even began making the software.

        It’s similar to raising money for your business (I also think that its easier than finding investors, you just find people who value what you got and are ready to pay for it, later you can get investors!)

        For anyone wanting to dive more into this just Google “mixergy snapinspect” it will be the first result.

      • I want to follow up on James’ comments and respond to Ana: It’s actually sometimes more difficult to raise money for charity than it is to raise money for a business (or to give money to a business). People will unblinkingly give money to many, many things (wine, dinner, groceries, books, disposable items, etc), that they want and that they get something for in return. If you read through a credit statement, you’ll see how much people spend. In contrast, asking people to give $29 — the price of a couple of books, or lunch for a few friends — can result in a lot of blank stares and people who don’t want to give away their money to things that don’t give them value in return.

        Raising $29K is difficult–extremely difficult!–and taking on this challenge has required me to figure out a great storyline, ways to encourage people to give, and to find ways to give value back to people if they do consider donating.

    • Kristjan says:

      Incentive in the personal business or project case is most commonly share of profits. That’s how Facebook,Google,Microsoft,Apple and countless other businesses saw daylight. With these examples though, Bill Gates and Mark Zuckerberg already had money, I figure, because their parents were rich enough to put both men in colleges they did not graduate.

  2. Despite doing charity work for years, I’ve never thought about it as strategically as Sarah. Insightful and brilliant. I wish you all the best.

    • Jeremy – Thank you so much. When I talked to a few people about the idea, I decided to go for it, because I thought it was a fun way to run a campaign and a way to make something both worth doing and worth telling. We’re already at $16,000 and I think we can get to $29,000 in the next few weeks. Thank you for your encouragement!!

  3. Timothy says:

    Sounds like an interesting idea or concept. Will certainly put it to use. Thanks James!

  4. Jeff says:

    I’d like to add more to the “networks matter” point. The age old saying of it’s not what you know but who you know is SO simple yet SO true. People want to help their friends, or associates before they want to help strangers.

    You need to get out of your comfort zone, and network. Get out there, go to mixers, go to events, just get your butt out of that chair and make some contacts. Without a solid network, I wouldn’t be able to start any of my ventures, crazy or otherwise.

  5. Kristjan says:

    Asking ´thousand people for 29 or twenty-nine people for 1000 is hard either way.
    $29,000 is not “boatload” of money. You can’t even buy a house with that. It’s pocket change.
    Well… it is an enlightning story, I must admit.
    I’ve spend years worth of sleepless nights brainstorming how to acquire 10 million euros for a comfortable home.
    While reading this article, I discovered that I don’t have a story and I don’t have a network of right people.
    I’ll get right on it. I’ll write a story with plot points and all.

    • Kristjan, You’re right: $29,000 is not a “boatload,” but it is a lot — and often the hardest part about raising funds is the first several thousand dollars (read: Chris Guillebeau’s “The $100 Startup). To put it in perspective: it’s more than the annual salary of a family of 4 at the poverty line in the US (approx $21,000 in 2012), and it’s enough to build wells in 4 communities for more than 3000 people in the world to change their lives for the rest of their lives. That’s worth something.

      Often people won’t do something because they don’t think it’s “enough” (aka, I have to raise $100,000 or $1M) and I think the counter is true: doing a lot of small things is equally–if not more–important. The trick is, you actually have to do something. So here’s to doing things worth doing!!

      Good luck with your storytelling.

  6. Good article.
    I’ve tried raising money before for a for profit business. That business was designed to help high school and college students find jobs while they’re in school. So even though it was for profit it had a charitable feel to it.
    That didn’t matter. I only raised a few hundred bucks. Why?
    A few things Sarah said were key: make sure people connect to the story. I don’t think I did a good enough job of really telling the story about how thousands of kids are looking for jobs and why it is important to help them. Instead I talked about her business and didn’t help the audience understand the pain.
    The second part I screwed up on was value. You can’t just offer someone a chance to be a part of the story or a sticker or t-shirt. You have to give them something of value or give them a feeling they will value.
    Again, another awesome article, James.

  7. Maddie says:

    It’s all about empathy. You have to connect with potential donors in order to make them feel like they can be a part of the “story” that you are telling. This really was a great post with a lot of good advice. I’m going to start fundraising in a few weeks and see how things go. Will report back ASAP!

  8. Pam says:

    Asking for money is something that most people won’t do. I did it once in the past and it was a tough task but the nice thing is that more people will help you out if you are serious about what you will be doing.

    Pam

  9. Nidhi says:

    Great ideas that really can make a difference!

  10. Taran says:

    I am also looking for money.Raising money is really difficult task.You have shared such great article, thanks.

  11. I agree it’s so important to build and have a network…especially before you need one. My advice is to go to local MeetUp.com groups and events in your area that revolve around your niche.

    You never know who you’ll meet, who you can help or who can help you later down the road.

    I love this: “Don’t be afraid to show up.”

  12. Robert West says:

    Good article for raising money.

  13. HT Lee says:

    That is an inspiring post for a worthy cause, filled with many helpful how-tos. I agree that people are moved by a compelling story, and all the more better if they can play a part in it. God bless your friend Sarah!

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