JOBS Act equity crowdfunding and Regulation A+ Mini-IPOs are not like the Field of Dreams. Going online and creating a funding campaign on a site like BankRoll does not mean that investors will come. Without marketing, the campaign will likely fail. The good news is, marketed correctly and effectively, you can raise millions of dollars in new capital. My article for Entrepreneur on this topic is linked here and tells you all about this. But for those who do not have 5 minutes to read the brief article, here are some highlights:
• With a Mini-IPO, unlike full-blown IPOs, there is no Goldman Sachs or Merrill Lynch instructing thousands of their brokers to push the IPO stock out to clients. With a Regulation A+ offering, nobody is promoting the stock to potential investors except the company raising money, and whoever they hire to market the offering.
• Most people have no idea how much money is spent to market high-end rewards-based crowdfunding campaigns. To give some perspective, a rewards-based crowdfunding campaign for the 1964|ADEL line of earphones, that deliver rich sound while minimizing risk of hearing loss, cost more than $65,000 in marketing, video production, advertising and public relations to raise $648,691 from 1,296 backers on Kickstarter.
• Roy Morejon of Command Partners is one of the top crowdfunding marketers in the world; he has an 85 percent success rate of campaigns reaching their goal, more than double the average success rate on Kickstarter, and eight times the average success rate on Indiegogo. Morejon says that Regulation A+ offerings will need to be marketed very much like a high-end Kickstarter campaign. “The goal is to get your investment opportunity to a large, but targeted, percentage of the general public,” Morejon notes. “You simply cannot just rely on word of mouth. You need to use tried and true public relations and marketing methods to drive that traffic to the Mini IPO offering in order to raise millions.”
• Economical solutions also exist. For example, companies like Krowdster help affordably market online funding campaigns. Josef Holm, Krowdster’s founder and a pioneer in marketing Regulation A+ offerings, says Krowdster provides marketing tools to quickly building a targeted crowd on Twitter and offers access to media lists from a database of more than 23,000 journalists in 170 crowdfunding categories, all in an affordable web app as an alternative to expensive crowdfunding consultants.
Intrigued and want to read the whole thing? Here is the link once again: http://www.entrepreneur.com/article/251808