5/20/2015 Create a Winning Equity Crowdfunding Campaign CrowdRabbit

Transcription

1 Home (/) Crowdfunding Resource Center: News, Education, and Data p://blog.crowdrabbit.m) Crowdfunding p://blog.crowdrabbit.category/crowdfunding/) 7 Steps to Create a Winning Equity Crowdfunding Campaign 7 Steps to Create a Winning Equity Crowdfunding Campaign BY BETH BRAVERMAN ( MAY 19, 2015 The world of equity crowdfunding has experienced exponential growth since the passage of the JOBS act three years ago. Last year there were some $230 million invested in equity crowdfunding deals, acrding to Wisdom Fund //fundwisdom.sites/all/files/cfund//fundwisdom2014dealreport.pdf). That s a lot of cash, but there s also a lot of mpetition to catch investors eyes and secure enough funding to launch a business to the next level. If you re interested in using equity crowdfunding as a source of capital, follow these steps. 1. Wait until you re ready. The most successful crowdfunding campaigns feature businesses with a proven business model and a bulletproof business plan for going forward. You ll want to show investors why it s worth putting their money to work for you, and exactly how you re going to grow that cash going forward. You ll need to work with an acunting firm to pull together hard numbers on how many customers you have, revenue to date, and some deals in the pipeline. If you haven t already, now s the time to hire an acunting firm to help prepare several years of financial statements, and a securities lawyer to draw up a shareholders agreement. Launching a crowdfunding campaign before your business is ready is a waste of your time, and uld hurt you if you decide to run another campaign at a later date. Instead of rushing to get a crowdfunding campaign started, spend some time working out any issues that uld damage that all-important first impression. 2. Prime your social network. Smart entrepreneurs are always growing their networks, both online and in-person. Make sure that your friends and ntacts know that you re going to be launching an equity crowdfunding campaign. Getting your network to ntribute to the campaign p://blog.crowdrabbit.attracting-investors-part-two-equity-crowdfunding/) in early stages will boost your credibility and the project s appeal to folks you don t know. 1/5

2 Personally reach out to any high-profile investors in your network to pitch your business. When and if they invest, tout their mmitment to the campaign to raise its profile. Then, nsider hiring a public relations firm, particularly one with social experience, to spread word about the campaign to those outside of your network. 3. Pick the right platform. There are dozens of equity crowdfunding websites, and each one has its own niche and a slightly different audience. They also all have slightly different fee structures. Do some research to make sure that the platform on which you re listing is a good fit for you and your business. For now, equity crowdfunding is still limited to accredited investors, but starting this summer you ll be able to legally urt any potential investors. Before going for the mom-and-pop investors, however, make sure that you re ready to meet all the other SEC rules that kick in once you do so. 4. Have a mpelling, professional video. The crowdfunding video is the new elevator pitch: You ve got a limited time in which to explain your business or product and nvince an investor to jump in. The good news is your video can be longer than the typical elevator ride but not much longer. Shoot for a two- to three-minute trailer that introduces both the business and the team running it. You ll also want to use the video and an acmpanying pitch deck to explain how you ve me up with your valuation, why you need money, what you ll use it for, and why you ve chosen to go the equity crowdfunding route instead of seeking venture capital. 5. Include a Call to Action. Your crowdfunding campaign is really just a sales pitch, and no sales pitch would be mplete without asking the potential buyer to close the deal. Ask for the money that you want, and tell investors as specifically as possible why they should give it to you. Unlike rewards crowdfunding, which typically aims to get many people to give a small amount of money, your goal should be to get a few investors to give large amounts. Remember, the more backers you get, the more expectations you ll have to manage. 6. Respond quickly to queries. Smart investors will want to do due diligence and will have questions about your business plan, your financial statements, and your experience as an entrepreneur. They ll also quiz you on your valuation and your exit strategy. Answer any questions quickly, politely, and mpletely. The more transparent you can be, the better. 7. Deliver what you promised. The best way to get more investors is to prove yourself p://blog.crowdrabbit.raisingcapital/mmunicating-with-investors/) to those who put money in early. Create a successful business, and your investors will be excited to evangelize it within their network. Facebook p:// Twitter Google+ //plus.google.share?url= LinkedIn p:// mini=true&ro=true&trk=easysocialsharebuttons&title=7+steps+to+create+a+winning+equity+crowdfunding+campaign&url= steps-to-create-a-winning-equity-crowdfunding-campaign/) CATEGORIES: CROWDFUNDING ( CROWDFUNDING ( EQUITY CROWDFUNDING ( RAISING CAPITAL ( LEAVE A REPLY Your address will not be published. Required fields are marked * 2/5

3 Name * * Website Comment POST COMMENT How to Conduct Due Diligence for Equity Crowdfunding p://blog.crowdrabbit.how-to-nduct-due-diligence-for-equity-crowdfunding/) Should Your Business Try Equity Crowdfunding? p://blog.crowdrabbit.should-your-business-try-equity-crowdfunding/) SUBSCRIBE Sign up to receive industry news and announcements. Address SUBSCRIBE (/FEED) p:// utm_source=cr_resource_center&utm_medium=banner&utm_campaign=fcs) POPULAR POSTS 3/5

4 p:// blog.cro Top 10 Benefits of Equity Crowdfunding for Startups p://blog.crowdrabbit.top-10-benefits-of-equitycrowdfunding-for-startups/) 19 Nov, 2014 Top Tech Crowdfunding Projects of 2015 p://blog.crowdrabbit.top-tech-crowdfunding-projects-of- 2015/) 19 Mar, 2015 How Equity Crowdfunding Will Change Angel Investing p://blog.crowdrabbit.how-equitycrowdfunding-will-change-angel-investing/) 01 Apr, 2015 Equity Crowdfunding Across the Globe p://blog.crowdrabbit.equity-crowdfunding-across-the-globe/) 06 Apr, 2015 What Types of Projects Should You Initially Feature on a New Platform? p://blog.crowdrabbit.whattypes-of-projects-should-you-initially-feature-on-a-new-platfor) 07 Apr, 2015 Crowdfunding Won t Crowd Out Venture Capitalists p://blog.crowdrabbit.crowdfunding-wont-crowdout-venture-capitalists/) 10 Apr, 2015 CATEGORIES Crowdfunding p://blog.crowdrabbit.category/crowdfunding/) Debt Projects p://blog.crowdrabbit.category/debt-projects/) Growing Your Platform p://blog.crowdrabbit.category/growing-your-platfor) Investors p://blog.crowdrabbit.category/investors/) Raising Capital p://blog.crowdrabbit.category/raising-capital/) Uncategorized p://blog.crowdrabbit.category/uncategorized/) Copyright CrowdRabbit /5

5 // //p ww lus. w.li goo // nke gle. ww din. w.f //t ace u/0 wit boo /10 ter. k.c mp 2311 om any 087 /cr /cr 292 cro ow ow 577 wdr dra dra 974 abb bbi bbi 874 it) t) t) ) Privacy Policy // Terms of Use // Contact Us // Important Disclosure: crowdrabbit.m is a website operated by CrowdRabbit, LLC ( Crowdrabbit ). The information presented on this website is not an offer to sell, or a solicitation of an offer to buy, any securities of offerings listed or described herein. Crowdrabbit is not a registered broker-dealer or investment advisor and does not perform any broker dealer or investment advisory services or activities. By accessing this website and any pages on this site, you have agreed to be bound by Crowdrabbit s Terms of Use and Privacy Policy. Crowdrabbit does not provide investment, legal or tax advice. No mmunication, through this website or in any other medium, should be nstrued as a remmendation by Crowdrabbit of any securities offering on or off this investment platform. The information provided on crowdrabbit.m, which may be linked to, is furnished by independent third parties who are not ntrolled by, or the responsibility of, Crowdrabbit or any of its affiliates. Neither Crowdrabbit nor any of its affiliates take responsibility for the accuracy or mpleteness of such information. Any information ntained herein should not be used as a basis for making any investment decision. To the fullest extent permissible by law, neither Crowdrabbit nor any of its directors, officers, employees, representatives, affiliates or agents shall have any liability whatsoever arising out of any error or inmpleteness of fact or opinion, or lack of care in, in the presentation or publication of the materials and mmunication herein. 5/5