Forget about Shark Tank. Never mind prepping for a Venture Capitalist Pitch. You don't even need to hit up your relatives to get your company the cash it needs to realize its potential. Now you can sell stock or float bonds through equity crowdfunding. You can raise $10,000 or $1M by appealing to your fans, customers, and investors interested in your idea.
Congress passed a bill called the Jobs Act. This bill allows companies to bypass the complicated SEC rules and paperwork requirements normally associated with stock offerings to the public at large. The act went further and also allows investments by "non-qualified" individuals. Within certain restrictions, everyday folks who don't have specific income or wealth can buy stock in your company.
Being first with ways to help you grow your business is part of our basic creed. We have been actively helping with Kickstarter campaigns, and now we are helping with a StartEngine crowdfunding campaign for Bike Friday. They have already raised over $140,000. If you'd like to know if crowdfunding through awards or stock offerings would work for you, call 319-910-1848. No cost, no obligation for first 45 minutes.
The first step in determining whether we can help you with a crowdfunding effort is to evaluate the current circumstances of your company. Our 45 years of marketing experience can help you consider every aspect of your marketing plan. If we believe that crowdfunding will work for you, we'll help with the preparation, timing, and execution.
We begin by evaluating your total marketing plan with an eye on whether you have a story that investors will be excited about. We might recommend changes in the product, packaging, pricing, distribution, advertising, sourcing, or sales team.
We might show you how you can accomplish your goals without raising funds, or we might suggest traditional banking or other methods for needed cash.
If we determine that crowdfunding is the best approach, we will suggest any combination of campaigns using rewards-based or equity-type efforts. It is possible that you will want to do both.
If we agree that crowdfunding is the way to go, we will help determine the best platform, help design the platform page, and design the needed marketing to attract the crowd to your project.
During the actual campaign, we will help with mid-course corrections, extensions, and other options you will face.
After the successful crowdfunding effort, we will stick around to help you execute your plan for growth.
You should figure on a minimum of $975 pre and post campaign, per month, for our services. For most companies our services will run $1975 per month during the campaign, plus a bonus for success.
You will need to plan a minimum of $10,000 for basic set up and legal expenses. If you hope to raise more than $100,000, advertising expenses are likely to increase. Keep in mind that all of these expenses will provide double duty. You will be advertising your products or services to your prospects, too.
If you look through the rest of this website, you'll see the wide range of services and approaches that we offer. We will write, design, or create any and all types of media, content, PR, videos, emails, etc. It would be easier to list the things we are not able to provide - We don't know anything about TV advertising.
For the purposes of this article, we will assume that your company wants to raise money through either reward or equity crowdfunding. When you have reached that decision, the next question becomes, "How will you attract and sell the crowd?"
Some offers are much more appealing to the types of crowds available to crowdfunding. For instance, you might think that a local retailer would have difficulty raising money from an online effort. However, if that retailer has a plan for multiple locations, or if the retail concpept is interesting enough , then it could be successful. I know of an ice cream shop that has grown to multiple locations using a close variation to the current concept of crowd funding before it was created. He has been selling stock to his customers for years.
So, think about your vision. Will you be able to succinctly explain your idea through text, video, and pictures in a way that will cause folks to get excited about your future?
While some very successful rewards-based campaigns were so compelling that they didn't need a fan base, most companies contemplating using this crowdfunding approach would do well to line up some fans prior to launch.
Seeding the campaign is usually an important factor in success. You want to have a bunch of sales the first day so that strangers will see action. They are much more likely to jump on board if they are part of a crowd that is going that way.
Your fan base can be made up of existing customers, friends, social media connections, prior business associates, etc. You will want to assemble these folks into a cohesive unit that is ready to move when you ask them to. Keep in mind that many will promise, but not all will actually follow through.
You may also want to use Facebook and other platforms to build additional connections prior to launch. Spending money on Facebook likes would be one example of a way to build your fan base.
While your headline and body text are important, I can't overstate the need for a compelling video. Video provides you a chance to fully explain and demonstrate your product or service, but more importantly, it provides a look at the soul of the leader they need to trust.
Crowdfunding is based on trust. In rewards-based crowdfunding, investors need to trust that the product is real, and that there is a high probability of the product actually being delivered some day. With equity crowdfunding, the investors need to trust that the leadership is capable, that the vision is amazing, and that there is a decent expectation of a big win down the line. Video provides the perfect medium for building that trust.
You need lots of testimonials! These can be folks who have loved your products in the past, believe in your leadership, or can testify to your trustworthiness. Can you get some of these on camera? So much the better.
I have overseen hundreds of events in my career; grand openings, book launches, weekend sales, trade shows, open houses, huge parties, and more. The proper execution of an event is a skill that requires knowledge and experience.
With crowdfunding there are two main events. The first three days and the last three days. If the first three days don't create momentum, you'll probably fail. Most of the money will be raised in those first three days or so. Up to 40% of the money will be raised in the last few days. Which means that you need to plan around the event of the last few days.
It takes time to prepare for any event. I tell clients that I need 90-120 days to properly execute any event. That is certainly the case in crowdfunding.
There are many, many secrets to maximizing your crowdfunding results, but nothing compares to the necessity that your concept be compelling. What can you do to make it seem like the next iPhone or Tesla? What visceral need can you meet? What emotions can you touch? What pain can your salve? What hope can you give? How can you provide a place for your investor to belong and feel like s/he is a part of something big?