Fundraising Made Easy: Crowdfunding

1. Fundraising Made Easy: Crowdfunding
Alberto Giusti
@albgiusti
alberto.giusti@42advisory.co
Nice, 19 July 2016

2. Who I am
2
@albgiusti
alberto.giusti@42advisory.co

3. 3

4. What’s not crowdfunding
4

5. 5
The crowdfunding process

6. Crowdfunding (a form of crowdsourcing) is the practice of
funding a project or venture by raising monetary contributions
from a large number of people, today often performed via
internet-mediated registries, but the concept can also be
executed through mail-order subscriptions, benefit events, and
other methods.
Crowdfunding is a form of alternative finance, which has
emerged outside of the traditional financial system.
Definition
Source: Wikipedia

7. Tipes of crowdfunding

8. Crowdfunding industry
Total Global Crowdfunding Industry fundraising volume
in 2015: $34 Billion (+112% 2015 vs. 2014)
Source: Global Crowdfunding Market To Reach $34.4b In 2015, Predicts Massolution’s 2015cf Industry Report.

9. Crowdfunding geography
Source: Global Crowdfunding Market To Reach $34.4b In 2015, Predicts Massolution’s 2015cf Industry Report.

10. Crowdfunding campaign benefit
Source : Capital Crowdfunding Advisor - February 2014.
• The average company invested 135 hours of staff time
in their campaign, with an average of 45 days
engagement.
• The average crowdfunding campaign returns $813
dollars for every hour invested.
• The average company spent just over $2,100 on the
campaign itself (video, marketing, social media
marketing, etc).

11. Immediate ROI in crowdfunding
• The average increase in quarterly revenue across all
types of crowdfunding was $12,675. This represents
an average increase of 24% quarter over quarter.
• Equity-based crowdfunding resulted in a quarterly
increase of 35%—not including funds raised via the
equity round.
Source : Capital Crowdfunding Advisor - February 2014.

12. Crowdfunding: impact on jobs
• 87% of firms either had or intended to hire new
employees as a direct result of having raised equity
or debt financing via crowdfunding.
• Average of 2.5 new employees.
• The larger the firm size, the more likely the firm would
reinvest crowdfunding proceedings into new
employee hires.
Source : Capital Crowdfunding Advisor - February 2014.

13. Professional Investors Engage with Crowdfunding
Source : Capital Crowdfunding Advisor - February 2014.

14. Crowdfunding is more than money

15. It’s all about Trust
• People will give if they like the product, like you (or
the company) and believe in the idea behind it. Be
transparent and build trust!
• Getting positive press/media can boost your
credibility and draw attention to what you’ve already
accomplished.

16. The constellation of Trust

17. Crowdfunding as start-up “easy” money
Source: Crowdfunding’s Potential for the developing world - 2013

18. Crowdfunding is becoming the new angel investor…
Source: Crowdfund Capital Advisors, EquityNet
• The average fundraising goal for
business startups is over $500,000
across all industries
• Energy & Utilities and Financial
Services & Real Estate have the
highest average fundraising goals,
while Consumer Products and
Services have the lowest
1,612,499
807,185
1,657,615
1,074,991
697,915
1,080,417
2,218,354
2,032,514
1,613,550
1,020,569 1,059,402
1,347,458
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Average Funding Goal by Industry
(2007 - 2015)

19. … for 25% of equity on average
On average, business startups gave up
nearly a 1/4th of their equity to crowd
investors
26.81%
30.85%
34.58%
25.38%
35.08%
29.54%
31.30%
43.11%
30.99%
32.18%
24.47%
36.68%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Average Investor Equity by Industry
(2007 - 2015)
Source: Crowdfund Capital Advisors, EquityNet

20. In some countries better than others

21. Netherlands docet

22. How to plan a crowdfunding campaign

23. •INSPIRE the audience with your VISION
•ILLUSTRATE your VISION with CLARITY
•BUILD CONFIDENCE that you can realize your
Vision
Vision, Clarity, & Confidence

24. •Research
• Have you done this before?
• Have you researched others who have?
•Budget Development Carefully
• No going back to “the well”
• Your reputation is on the line
•Budget Publishing Carefully
• Marketing & PR
• Distribution Costs
Know What You’re Building

25. Research Similar Crowdfunding Projects
•What funding ranges worked?
•What reward prices worked?
• Graph the revenue per price point
•What reward items / content worked?
•What social missions worked?
•What social rewards worked?
Campaign Planning

26. Research Similar Crowdfunding Projects

27. What’s about time in other projects?

28. Understanding Cost Of Goods
•Digital Distribution
• PC - Costs of fullfilment
• Mobile - Watch out for iOS costs
•Design and Sourcing
• Everything you do takes time away from your Project
•COG Challenges
• Low volume manufacturing = high unit costs
• More reward items = lower production per item
Campaign Planning

29. Vision, Clarity, & Confidence
• KISS Keep It Simple (or you're the one that is) Stupid
• Hierarchy of Information
• Video
• Graphics
• Text
• FAQ
• Video should be Professional but PERSONAL
• Don’t overproduce it.
The pitch

30. This isn’t a Sprint - it’s a Marathon
The Arc of a Campaign

31. You Must Open with a BANG
• You need to BUILD an audience BEFORE launching
• Go live where they live - they need to know you
• Share with them your vision beforehand
• Get them psyched to be there on day one
• You need to MARKET your Crowdfunding
• Use Social Media Missions to spread the word
• Network with other Crowdfunders, Press and Platforms
The First 48 Hours

32. Keep the Energy UP
•Connect with the audience
• Answer questions – promptly
• Say thank you – personally
• Participate in the dialog – constantly
•Schedule exciting new updates – Regularly
•Create activities to keep the audience engaged
The 26 Days of Hell

33. Create activities to keep the audience engaged

34. Increase the Energy
•Kickstarter’s 48 Hour Email
•Hold something EXCITING to be revealed
•Now it's a SPRINT - go to FULL COURT PRESS
The Last 48 Hours

35. Takeaways
35
• “Crowd” before and over “funding”
• Crowdfunding is more than money
• Crowdfunding campaign = marketing campaign, not
fundraising campaign
• Crowdfunding change business models: fans&investors
become the marketing team, crowdsourced engagement,
new ownership models

36. Contacts
Alberto Giusti
@albgiusti
alberto.giusti@42advisory.co
Feedbacks on https://ekoodo.com/alberto-
giusti/en