Crowdfunding, the newest way to give support to business ideas, artists and other talent, has emerged as a major funding source, observes Seed Equity Ventures. What began in 1997 as a novel way for a British band to fund their reunion tour has become a billion dollar industry with legal protections in the United States.
Capital raised through crowdfunding platforms tripled from the year 2009 to 2011, from $530 million to $1.5 billion, notes Seed Equity Ventures. The industry continues to expand, and has taken on a great significance as small business loans become harder to find.
SeedEquity.com aims to help entrepreneurs raise funds by connecting them with investors around the world who are eager to fund new ventures. Seed Equity Ventures is a registered broker dealer with the SEC and a member of FINRA/SIPC, not just a crowdfunding platform. Instead of passing out trinkets in exchange for funding, startups can connect with global investors looking to form partnerships with the next big thing.
Pitch Is Crucial
In order to effectively tap into the potentially vast resources available through crowdfunding, however, you have to have an excellent pitch. Presenting yourself online means you need to appear modern, eye-catching, and be concise. This first impression is crucial to the success of your venture, cautions Seed Equity Ventures.
“The best pitch always wins the capital. That’s bottom line,” says a SeedEquity.com representative. “If your pitch is not spot on and doesn’t appeal to the largest number of people, your campaign could be all for naught.”
Preparing Your Pitch
The business investment professionals at Seed Equity Ventures encourage entrepreneurs to be 100 percent ready for their venture to go live before posting their pitch. This requires a presence on social networks, an appealing website, and a thorough business plan. Without these things, even the most appealing video pitch will be unlikely to connect with investors, who want to be sure their money will go to people who are poised for success.
Remember that potential crowdfunders have probably never heard of you, says The Washington Post’s Mohana Ravindranath. You need to tell a compelling story of who your company is, why it will be successful, and how you plan to succeed, Ravindranath says. Keep in mind that your audience is unlikely to be experts in your field, so you need to give them all the information relevant to your business to show its potential as a winner.
The video pitch is king in crowdfunding, says Seed Equity Ventures. No matter the platform, crowdfunding sites show again and again that in order to successfully entice investors, you must have a video, and it must be compelling.
Your video pitch is your chance to connect with other people in a personal, powerful way. Hootsuite notes that videos are shared on Facebook 12 times more than text posts and website links combined. Websites with videos hold viewers’ attention longer than text alone.
We pay attention to faces, notes Fundrazr’s blog. Our brains pick up on cues from facial expression, tone of voice, and body language to enable us to understand other people. Putting yourself in a video pitching your business venture gives investors the chance to connect with you on what feels like a more personal level, and it allows them to truly see your potential, SeedEquity.com says.
It is not necessary to spend a great deal of money on your video pitch, but production values are important. Remember, how your video looks is how investors will view you. If your video looks shoddy, they will assume your company is shoddy as well. Make sure you look competent, professional, and interesting.
Advisors at Tubestart.com say the first 10 seconds of your video make the biggest impact. After 30 seconds, they say one-third of your viewers are likely to switch their attention to something else, so get to the point quickly and make them want to stick around.
Use your video to tell an engaging story. Let your enthusiasm show. Make sure you have a script prepared so your story has a clear arc, but take care not to appear stiff. Showcase your product and make the case for why it has the potential to benefit investors.
Using crowdfunding to connect with global investors is the next big wave in business, says SeedEquity.com. “We’re providing an international platform that is allowing individuals from other countries, not just the United States, access to the equity required to get a company going,” they say. “As a registered broker dealer, Seed Equity Ventures is on the forefront of a new era of crowdfunding, where real investments can be made.”
This post is sponsored by NHQ. All opinions are 100% my own.
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