Looking to raise money using an equity crowdfunding campaign?
I’m talking about using Reg A+, Reg CF, or Reg D of the Jobs Act.
In today’s YouTube video, I’m going to go over the basics of equity crowdfunding. We’ll cover how it works, how you can use it, and some of the advice that I have for you getting started.
A lot of this advice comes from my book, Equity Crowdfunding Explained. If you’re interested in learning more, grab a copy. I think you’re gonna like it!
Let’s get into some of today’s crowdfunding tips!
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I put out videos every week on crowdfunding. You can get them delivered straight to your inbox by subscribing and turning on notifications.
Equity crowdfunding is a bit more complicated than other types of fundraising. For one thing, you’re giving away equity or shares of your company. Automatically, this brings securities laws into question.
My video walked through the basics of crowdfunding for equity, but I also want to share some tips here…
1. Study, study, study
If you really want to do one of these campaigns, it’s going to pay huge dividends to get educated. Take some time to watch this video and others on the subject.
Grab a copy of Equity Crowdfunding Explained and read it cover to cover. You will thank me later. You’ll learn how to create one of these fundraisers, attract attention, and the various laws you need to abide by.
Along with becoming educated, I’ll also seek out teammates who are knowledgeable in this industry. I’m talking about lawyers, accountants, and a company like Crowdfundx.
2. Know The Regulation You’re Using
Depending on which regulation you use to raise capital, it will impact the costs associated with your project. Some regulations require audited financials and significant up-front labor. Others won’t cost you much of anything.
The regulation that you’re using to raise money online will also determine the strategy that you’ll use to acquire investors. Not every regulation allows general solicitation, so you gotta do your homework.
Finally, the regulation you go with will impact which platform you use to raise money. Not all platforms are created equal. Some are better when it comes to Reg D raises and others are good for Regulation CF.
3. Creat a marketing plan
Just like with other types of crowdfunding, you need a marketing plan going into an equity raise. Even if you’re just doing a private raise and are not soliciting the public, you need quality investor documents and videos.
Marketing can literally make or break the success of your fundraiser. It can me that tons of people discover you online, or no one does. I’d plot out the varies channels you’re using, how much it’s going to cost, and whether or not you’ll use an agency.
In addition, another key part of marketing is creating a compelling story and vision that investors can buy into. That means you’ll a quality video, images, and other assets to persuade lurkers to become investors.
4. Learn how crowdfunding works
Crowdfunding is different from other forms of marketing. The entire process can be a bit confusing. You gotta learn your craft before going into the lion’s den.
Take a second to watch the video I put together on how this all works. Once you watch it, you can comment below it if you have any questions and I’ll do my best to get back to you if I can.
You can also schedule a coaching call with me if you’d like to get more clarity on whether or not equity crowdfunding is for you. We’ll go through your individual project and get to the heart of the matter.
No matter what you do, at least take a couple of hours to go through some of the existing equity crowdfunding campaigns that have been successful. Study their video and any pitch materials that you can find.
Remember, success leaves clues. All you gotta do is hunt them down!
5. Consider Using a Service Provider
Almost all great things on this earth were accomplished by a team of people. It’s time to start building your team for your project.
I’ve put together a list here of some of the resources out there. I hope you find it to be helpful and that it gets you started on the right foot. You can always send me an email or book a coaching session if you’d like me to individually look at your project.
Not every service provider that you come across is going to help your particular company, so be sure to vet them thoroughly.
This is the dawn of a new age where anyone out there can raise funds from the crowd. It’s extremely exciting and I can’t wait to see your startup listed as one of the success stories in this industry!
