It Costs Money to Raise Money.

Too often I am contacted by people who mistakenly believe that a “great idea” means people will want to give them money to start their business. Reality check: if you have no money to assist with your fund raising or crowdfunding campaign then it’s probably best that you don’t even try.

You need money for a comprehensive investor or lender-centric business plan, executive summary, and pitch deck, for  lawyers, for accountants, for marketing, for assistance with your offering terms, for more marketing, for due diligence costs, for escrow fees (if applicable), for offering transaction fees, for regulatory filing fees, and for more marketing. You may have the coolest thing in the world, but nobody works for free and you’ll only get what you pay for in terms of services and quality.

Many are under the misconception that you can raise lots of money by simply posting your deal on a crowdfunding site. The key to successful crowdfunding is marketing your offering.

The keys are basic:

• Set terms appropriate for your potential investors - too often people offer too little ownership to potential investors or reject staged funding based on achieving milestones
• Keep the offering minimum as low as possible - typically 20% of crowdfunding deals are funded by $25,000 or less. Looking for big investments can eliminate a large part of your funding potential.
• Spend serious time on your marketing plans, and allocate a budget to get this done. Crowdfunding success is driven by marketing your opportunity.

Do this right and you’ll give yourself the best chance at getting funded. Miss any of these and you’ll likely see your time, money and effort wasted.

Click here to review or develop your funding strategy