By CAITLIN HUSTON, Want to launch a crowdfunding campaign? You’d better get started yesterday.
The popular perception of fundraising sites like Kickstarter is that entrepreneurs can cut out a lot of the legwork of landing money. But experts say that’s far from true.
A successful campaign takes plenty of advance planning—as well as constant involvement along the way—to keep backers happy and new supporters joining on. A halfhearted effort could not only make a cash drive stall out, it also could do lasting damage to an entrepreneur’s standing with customers and potential investors down the road.
Here’s some advice from pros and entrepreneurs who have made the process work.
Form a Company
As you plunge into fundraising, it’s smart to make sure that you protect yourself by creating a formal business entity, such as a limited-liability company. With a structure like an LLC in place, anyone who sues you can only receive assets from your LLC, not from your personal wealth, says Tom Murphy, senior partner at McDermott Will & Emery LLP in