Why are some equity-crowdfunding campaigns more successful than others?

by Startacus Admin

Decided that equity-crowdfunding is the best option for funding your business, but wondering what it is that makes some campaigns hit their target?  Europe's leading equity crowdfunding platform Seedrs take a look at what you should consider to make your equity crowdfunding campaign a success.

Select the right platform

When choosing an equity-crowdfunding platform, be sure to scrutinise what assistance it will provide. For example, check the level of marketing and PR support it will offer. And ask about what help with admin you’ll  receive. To run a successful equity-crowdfunding campaign requires expertise and attention to detail. We believe that’s why Seedrs had the highest campaign success rate in UK equity crowdfunding in 2017.

Tell the full story

Be prepared to put a lot of thought into crafting the back story of your business. Is there something unique about how you do things or does your product or service do something that no-one else offers? If so, highlight it. But, be scrupulously honest and don’t make any exaggerated claims.

Describe what your business means to you, and in particular, what difference hitting the investment target will mean. Try to put together a clear and accurate piece that will appeal to potential investors and inspire them to invest in you.

Let people see your excitement and passion, then encourage them to be a part of it.

Make sure the timing’s right

To have a successful equity-crowdfunding campaign you need to be focussed. Plan to run your campaign when you won’t be distracted with other critical projects, from producing prototypes to launching a website. If there’s a time of the year when you typically have business spikes or you go on holiday, don’t let your campaign co-inside with it.

Set a realistic investment target

Ask for the amount that you realistically need to reach the next milestone. On most platforms it’s ‘all or nothing’, so don’t ask for too much – or too little.

Investors will want to know how you intend to use their money, so be prepared to share the details of your proposed cost breakdown, making it easy as to follow and simple to understand why you need the money.

Put together a social media strategy

Start building up your social media followers before you’re planning to launch your raise.

This gives you another channel to  communicate throughout your equity-crowdfunding raise. Talk about:

• General business news.

• People you hire.

• Product/service improvements.

• New lines.

• Any positive press coverage you receive.
  
  

If you already have a good social media following before the campaign’s live, you’ll have already nurtured a community who will be interested in investing in your business. It’s usually much easier to meet your investment target when you’ve already developed a following.

Events are a chance for personal contact

One way to build community is to speak at conferences that are connected to what your business is involved with.

Turn every event you attend as an entrepreneur into a promotional opportunity. After all, with equity-crowdfunding, everyone is a potential investor. Once your campaign is live, plug it at the end of every speech you give or conversation you have.

Create a stunning campaign video

The quality of your equity-crowdfunding video is important to the outcome of your funding.  Use it to quickly outline your business and everything you’ve achieved so far, from important milestones to business growth and the PR you’ve generated. Highlight the unique selling points. Introduce your team. Explain the potential.

You need to cover a lot of ground in a short time:

• Product/service demo.

• Why you do what you do.

• How your business solves a problem.

• The size of the market/opportunity.

• Why you and your team are best-placed to reap the rewards.

• Sum-up the opportunity and how the investor can share in it.

Create a PR plan

Start with an announcement about your campaign’s launch date – at least a month before it’s due. Cover what you plan to do with the money and the difference it would make. If you’re having a launch party, give the details, along with any news about any live pitches you’ll be giving, and where to find your campaign page.

On top of the list of journalists and publications that you usually approach with press releases, research writers that have covered equity crowdfunding campaigns in your area/sector. Remember to feature any articles and mentions in the press that you get about your campaign in your chosen social media channels.

Keep investors up-to-date

Regularly let investors know how your equity-crowdfunding campaign’s progressing. Be sure to tell them when you reach important milestones.

Post a quick video to thank all your investors for all their support so far. And, all the way through, encourage your audience to share your updates on your campaign.

Ready to raise funds? Apply to raise.

If you like this Seedrs article, you might also want to read their previous article 'Debunking 7 equity crowdfunding misconceptions'

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Published on: 28th June 2018