Do you ever wonder why some fundraising campaigns take off like magic?

Do you ever wonder why some fundraising campaigns seem to take off like magic, while others fail?  These are the key factors that the most successful campaigns have in common:

  1. A great business model - Ultimately, it all comes down to the business model.  Have you discovered a business with tremendous revenue and profit potential?  If the answer is yes, then investors will be happy to back your idea. If no, then it’s time to rethink your strategy.

  2. A groundbreaking technology -  Investors love the idea of getting in on the ground floor of new, cutting edge technologies.  Biotech and consumer products, if they have a highly engaged fan base, can also do well. However, technology investments are the easiest to sell, especially through digital marketing.

  3. A concept that is easily explained to investors - Ideally, you should be able to explain your business and why it is wonderful in three sentences or less.  This will be essential for your social media campaign. Also, plain English is a must! You can have the greatest business idea in the world, but if people can’t understand it, then they won’t hit the invest button.  

  4. Proven traction - It is easiest to sell your story if you can demonstrate traction, such as account/user/customer growth or revenues.  A demonstrated track record of previous fundraising for your business is also helpful.

  5. Founders with a demonstrated history of success - If you have founded previous successful startups, then you are golden.  Don’t worry if this is not you. It will just take more effort on your part.

  6. Big name backers - If you have big name VC’s or angels backing your business already, this is a big plus, and be sure to mention it on your offering page and in your ad campaigns.  

  7. Large and engaged social media following - An engaged fan base is huge, if you want to run a successful campaign.  Focus your efforts on creating a large social media following before you launch your offering.  This will allow you to bring in investments through free organic posts on Facebook, Twitter, and Instagram.  Don’t be afraid to market your offering to your customers! They already know and like your product, which makes them more likely to invest.

  8. A targeted email list - A great email list is everything.  Build your list of current and potential customers, vendors, and targeted investors in advance.  We have seen campaigns fund their entire offering through emails alone. Make sure your email is clear and concise and demonstrates the benefits of your product or service.  Don’t forget to include a link to your offering, and send several follow-up emails mentioning the progress you have made on your campaign to date.

  9. Press coverage - The most successful campaigns are able to find press coverage for their offerings, ideally from sites that specialize in recommending private capital investments, such as KingsCrowd or Early Investing.  

The private capital markets can be a great place to raise money for your early or late stage company, even if your business has only a few of these factors.  In the end, it will be hard work that makes your offering a success.

Coreen Kraysler, CFA

Coreen Kraysler, CFA · Author

CFO, ValueSetters

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