Equity Crowdfunding Promotion – Where Wall Street Meets Madison Avenue
I find myself constantly explaining equity crowdfunding to people who are confused by the hundreds of “crowdfunding experts” who aren’t really expert at raising capital. (Any real expert knows equity crowdfunding promotion is always the top priority. – ed)
In a traditional IPO, the individual stockbrokers in the underwriting syndicate are each allocated a fixed amount of shares. The stockbrokers will then get on the phone and sell those shares to their existing customers. If the first customers they call don’t buy the shares, they keep on making calls until they have sold their allotment. It is all based on the collective efforts of a lot of salespeople.
In crowdfunding, the salespeople are replaced by carefully targeted advertisements, usually delivered by e-mail. (That’s why equity crowdfunding promotion is so important – ed)
Will people actually invest their money based on an e-mailed advertisement? Schwab, Fidelity, Vanguard and others have demonstrated that they will.
Of course the ads themselves need to deliver the right message; a compelling reason why people should invest. (In mainstream marketing circles legends like Dan Kennedy and John Carlton call it a compelling call to action. – ed)
A good marketing firm will test a series of ads to determine those with the best conversion rate and build a marketing campaign around those ads, until the funds you are seeking are raised. Unfortunately, very few of the marketing companies that serve the equity crowdfunding market understand that selling an investment is not the same as selling a product.
(Equity crowdfunding promotion attempted by a mainstream advertising agency could lead to big trouble with the SEC or FINRA and fast! – ed)
If you create an offering that will not attract investors or if you don’t have a budget to hire a good marketing company, you should not start the process. If you are serious about raising some capital to help your company get in touch with me and I will be happy to refer you to professionals who will get the funds you need.