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Crowdfunding For Equity – A Great Way To Fund Your Project

Crowdfunding For Equity – A Great Way To Fund Your Project

Business ideas happen every day and only those who take the leap and put words into action will achieve the success they deserve. A good business plan with actionable steps and deadlines are necessary but most of all a good amount of equity can insure the plan will be funded properly, giving it the best chance for success. For many aspiring businesses, the thought of financing their dream and turning it into reality seems impossible but for those in the know that understand the advances in technology have discovered the use of “crowdfunding” to reach their goals. Crowdfunding for equity is becoming more and more popular, thus making it an obvious choice for startups to consider, however what are the steps to increase your chances of success? That is what we’ll be discussing in this article.

To further elaborate, crowdfunding for equity involves pooling the resources of potential groups of investors, mostly using cutting edge technology in order to manage this. It is a perfect option to raise money as well as prove a concept is even viable. Traditional and SBA (Small Business Administration) loans require a new business to prepare a sound business plan but no real feedback is given about the true viability of the plan. Yes, they have financial models to predict success but with so many variables to factor in, their approximation really comes down to sterile numbers.

With current crowdsourcing platforms, one will get feedback on the proposed business concept while usually receiving a simultaneous donation. This is very powerful as a smart business owner will steer the original business plan in another direction if the potential customer base reveals a better solution, all the while building up the necessary funding to insure continued success.

As mentioned, there are a few things that can insure your crowdfunding project is a success. The most important one is developing the best reward program you can as it will make potential investors feel warm and fuzzy inside. This is known as the WIFM (“What’s In It For Me?”) concept, and always a good angle for any marketing strategy. By offering limited edition models or services only available for initial investors and progressively adding more value as certain benchmarks are reached, will help fuel the fire in the already eager crowd you have attracted.

Prepare a complete overview of what you are doing with fully developed sales copy. Tell the story behind your concept and idea, using video to convey it. Over deliver by fully engaging with every potential investor that visits your crowdfunding project webpage. Consider donating a portion of proceeds to an appropriately related charity will do wonders for publicity as well. Speaking of which, investing some time and developing relationships with key people in your industry will greatly help your cause in the future. Asking for these same people for help in promoting your project will help garner the necessary attention you need for success.

As one can conclude, the daunting process and unreasonable expectations usually associated with traditional loans makes crowdfunding for equity a more obvious choice. With technology constantly improving in this area and entrepreneurs becoming more savvy in the process, the future certainly looks bright.

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