Crowd source investment for your business
‘Crowdsourcing’ investment is simply about attracting a group of people to invest in your business as shareholders, philanthropists, members, or as clients – depending on your approach. It’s a great way of raising investment upfront to help fund the growth of your business, and it’s now a financing method used by both commercial and non-profit businesses as an alternative to traditional investment sources e.g. bank loans.
Over the last year there has been a rapid growth in crowd sourcing websites, which provide you with a portal to attract and secure potential investors online in an easy and secure way. It basically allows any individual or business to invest finance in your business. Check out the list of websites at the bottom of this article. The crowdsourcing portals often require you to confirm the financial amount you require to fund a specific activity or product. If you successfully raise this amount, the finance is then released to you. The portals often take a relatively small cut of approximately 5%.
The portal is quite often the method for handling this financial process but you still need to do the promotion and advertising yourself to attract people to your business proposition and to make the pledge through the website. The key to successfully attracting finance is for people to believe in your brand and what you are trying to do. If you are a non-profit, this will often relate to what charitable cause you are tackling as well as your business model. If you run a commercial business, this will often relate to your business proposition and potential for profitable growth.
To get you some ideas of how other brands have attracted investors, see below
Café Direct – the fair-trade coffee brand raise their finance through shareholders. Café Direct are particularly excellent at promoting their brand through informational and promotional videos about the core values of their brand. For some inspiration check out Click Here for more about Café Direct
Tribewanted – an eco-tourism business, needed to raise funds to lease an island in Fiji to kickstart their eco-tourism resort working with the locals. Tribewanted asked people to buy their tickets upfront to visit the island over a two year time period and get involved in the project. They used social media and other media channels worldwide including press, tv and radio coverage across the world to stimulate interest in being part of this exciting new eco-venture. They succeeded to raise the funds upfront and it’s progressing well five years on with new destinations in their pipeline. www.tribewanted.com
Bubble and Balm – a fair-trade bodycare company have recently secured their £75,000 through Crowdcube. Their well designed website clearly stipulates their brand values and business progress to date and they have utilised PR and Business Competitions to raise awareness of their brand. They were the first bodycare company to achieve their fair-trade mark and after just one year of trading they can confidently present their business progression through securing sales channels with leading supermarket Waitrose and other independents outlets. Find out more at http://www.bubbleandbalm.co.uk/about-bubble-and-balm
Aidpods by ColaLife – ColaLife successfully secured £3000 investment for their international aid charitable venture Aidpods through BuzzBnk . They clearly defined their business pitch about what they wanted to do and how people could get involved on the Buzz Bnk website. Check out their online pitch here https://www.buzzbnk.org/ProjectDetails.aspx?projectId=14
If you would like help putting together your marketing and promotional activity for crowdsourcing your investment then one of our specialist businesses coaches would be able to help:
Contact us via email at: [email protected]
Crowdsourcing Websites - http://www.crowdsourcing.org/about http://crowdsourcingresults.com/
Commercial Businesses - www.crowdcube.com
Social Enterprise Specialist - www.buzzbnk.org
