In the minds of many an entrepreneur, equity crowdfunding should be a shoo-in. You’ve had the spark of a bright idea, built a remarkable product, and a strong business model – the crowd would be mad not to invest, right?
Sadly, the reality is often very different so we asked crowdfunding expert, John Auckland, to explain why engaging messaging is vital, and how to craft a compelling message.
Surprisingly to many, however, more equity crowdfunding campaigns fail to hit their minimum funding target than actually succeed. Why? One big decider in the success of any campaign is the clarity of the messaging.
If you can get across your proposition effectively, in a way that draws-in investors, you’ll stand a far better chance of getting investors to back your crowdfunding campaign.
Concise, engaging messaging is what makes a successful crowdfunding campaign. It’s the consistent theme throughout all your pitch materials that lets investors know that you are a unique business and a prime investment opportunity that’s worth snapping up quickly.
So, how do you go about creating engaging campaign messaging?
Tell a story
While obviously looking out for an innovative product or service when I’m chatting to new potential crowdfunding entrepreneurs, I have to admit I’m a sucker for a great story.
It could either be the founder’s journey, a classic light bulb moment, or something deeply personal that led them to found their business. Remember that investors are human too, and they invest in people, not just propositions.
So, what’s your story? How did you come to found your business, create your product or service, and what has been your biggest drive?
Never underestimate the value of your story. Founders often miss sharing their story in favour of the business idea itself, their USPs, or their achievements to date. Not that these aren’t important points, but only the story is able to bring out the emotion that builds human connection.
Your story is no doubt a long one, so try to drill it down to the most important chapters. Just make sure you tell it!
The Elevator Pitch
You’ve all heard of the elevator pitch – that 20-second summary of your company that gets across all the key points. This, of course, is just a taster that brings investors, partners and other backers into the fold, and a starting point to a more comprehensive proposition.
That’s why, during my equity crowdfunding training programmes, the first thing I ask entrepreneurs to do is put together a one-minute pitch presentation. They note all the best aspects of their business in a concise way and use them as the basis of a short script suitable for their crowdfunding video.
A concise script ensures founders focus on the most essential and unique factors of their business, while leaving out the less crucial parts. This piece of work also helps entrepreneurs stick to a strong, succinct message that can become the foundation of their campaign messaging.
Solve a problem
Once you’ve honed your story and polished your one-minute pitch, look to your value proposition;
- Who is your company helping?
- What problem are you solving, and how?
- How pressing is the problem, and
- Why are you best placed to solve it?
You might have a great product, but unless you’re solving a problem, it won’t be seen to have value.
Try looking at other products or services that offer a similar solution and ask yourself;
- What problem do they aim to solve?
- How does your solution compare?
- Is it better, or even unique?
The amazing business ideas out there often aren’t those offering something completely new, but those offering a substantial improvement on existing solutions. Many a disruptor has shaken-up an old industry by providing a key evolution to an existing product or service.
Locate your target audience
Your core messaging must speak directly to your target audience, so make sure you know exactly who you’re addressing.
Rather than attempting to appeal to everyone – a futile task that will distort your message – do some customer research to know your target audience well.
Then, learn about your investors. Who are they? Where can they be found? Where do they find their information? etc.
As well as helping you target your messaging to different audiences, creating target profiles will also help you locate the best channels to reach them. So while backers might be found on YouTube and Facebook, investors are best engaged via LinkedIn and trade publications, which makes a PR exercise essential.
Understanding the relationship between your customers and your industry, and where they can be found online, allows you to target them with engaging messaging that will help to boost campaign investment.
Put your messaging to the test
Much like when you’re preparing for a key presentation, practice your messaging in front of friends, family, colleagues, and ideally, investors, to hear what they thought of your proposition. Key points to find out are;
- Did they easily understand your business idea?
- Were they touched by your story?
- Did they notice all the USPs you aimed to put across?
- Did they recognise all the virtues?
It’s also worth clocking how long it took for them to take your messages in. If you had to spend several minutes explaining, then your messaging lacks clarity and conciseness.
The premise should be clear within a few sentences, and the function of your business in little more than a minute. If it takes much longer, you’ll have a hard task communicating it to your target audience.
Strong communication paves the way for crowdfunding success. With so many other campaigns for investors to sift through, yours will need to make a strong impression for you to hit your fundraising target. Put the work in though, and it’s far from an impossible feat. Good luck!
About the author
This guide has been written exclusively for ByteStart by John Auckland, a crowdfunding specialist and founder of TribeFirst. Tribefirst is the world’s first dedicated marketing communications agency to support equity crowdfunding campaigns, and has helped raise in excess of £25m for over 60 companies. John is also Virgin StartUp’s crowdfunding trainer and a regular contributor to ByteStart. You can benefit from more of his crowdfunding expertise in;
- How to Build the Perfect Pitch Deck for Raising Funds
- How to Prepare Your Business for Crowdfunding
- Equity v Rewards Crowdfunding: Which is Best for Me?
- 5 Reasons Why You Should Crowdfund in 2019 (and How to Get Started)
More from ByteStart
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- How the Enterprise Investment Scheme (EIS) can help you raise funding to grow your business
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- A Guide to Merchant Cash Advances
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