Crowdfunding helps businesses to tap into their existing customer base or begin to leverage a new one. With the new ruling from the Securities and Exchange Commission [SEC] allowing equity crowdfunding to the general public in limited formations, crowdfunding has become the next great way to start a business.
Not every business which chooses crowdfunding, however, is going to find success. These easy key points of approaching an equity crowdfunding campaign have the potential to bring about a better chance for that success.
1. Be Inspirational
People invest today because of their emotional connections. They’ll go against good advice from industry professionals sometimes because of their “gut feeling.” If your business can offer a solid value proposition by solving problems that people didn’t even realize they had, then you’ll build instant loyalty as you build a supporting base.
2. Be Engaging
Equity crowdfunding is more than just a business transaction. It’s also the cornerstone of a relationship. At some point, to maintain any relationship, one must communicate with the other party. Interacting with backers will keep loyalty bonds strong and there are numerous platforms around today that make this easier to do than ever before.
3. Use Your Leverage
Marketing is a needed component of any equity crowdfunding campaign. Get as many people involved as you can. Journalists, bloggers, brand ambassadors – they all help to share your message, endorse your product, and grow your supporting base.
4. Research Your Market
It can be a lot of fun to charge ahead blindly while pursuing a brilliant idea. The fun stops when there is no cash at the end of that journey. For success to come through crowdfunding, it is necessary to research the current market to see if your idea has any traction. This process may take 3-6 months to complete before you take your crowdfunding campaign live.
5. Polish It Up
It can be somewhat tedious to dot every “i” and cross every “t” in your business documentation, but accurate plans provide accurate results. It’s more than just presenting a professional image – it’s giving backers information they need to perform their due diligence.
Equity crowdfunding will change the US marketplace. These 5 simple tips will help you pursue your piece of that cash pie.