Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Crowdfunding for Your Innovation

301 views

Published on

Presentation by Devin Thorpe to Thomas Jefferson University on November 2, 2015.

Published in: Business
  • Be the first to comment

Crowdfunding for Your Innovation

  1. 1. Devin D. Thorpe @devindthorpe #letsdosomegood
  2. 2. Endless Computer 1 $176,538 raised!
  3. 3. A little about me 2
  4. 4. 3 Teton Dam
  5. 5. 4 Treasurer/Investment Banker/CFO
  6. 6. Champion of Social Good 5
  7. 7. Crowdfunding • The use of third-party websites to raise money for your project • Examples – Kickstarter – Indiegogo – Rockethub • Hundreds of others 6
  8. 8. Types of Crowdfunding Rewards T-shirts, albums, games, DVDs and technology Investments Debt and equity issues Donations Nothing but thanks in return 7
  9. 9. Crowdfunding Potential • $200 million for a skyscraper in Bogota, Colombia (investments) • $13 million for a cooler that will charge your phone and blend your drinks (rewards) • $5+ million for Habitat for Humanity (donations) 8
  10. 10. What to Expect • Crowdfunding for investments is new, with average raises of about $100,000 in the UK • Crowdfunding for rewards and donations average about $4,000 to $5,000 • Many campaigns fail to raise any money at all • Most campaigns raise less than $5,000 • A few, big winners skew the average 9
  11. 11. Where The Money Comes From • The “Crowd” is almost as difficult to find as sasquatch • The money will come mostly from your own network (about 75%) • The most successful campaigns get 75% or more from the “crowd” 10
  12. 12. SMAC! Monkeys
  13. 13. Trust • Are you trying to cheat me? – Use your real identity – Connect to social media accounts associated with your real identity • If not, are you capable of being successful? – Describe your qualifications – Highlight past success 12
  14. 14. Crowdfunding Timeline Phase I: Reconnaissance Phase II: Preparation Phase III: Ground War Phase IV: Air War Campaign 1 2 3 4 5 6 7 8 9 10 11 12 Phase I Phase II Phase III Phase IV Campaign Timeline in Weeks 13
  15. 15. Assessing Your Team • How many partners? • How many champions? • How many boosters? • Partners are worth an average of $2,000 each. • Champions are worth about $1,000 each. • Boosters are worth about $500 each.
  16. 16. Assessing Your Cause Score your cause on a 5-point scale: Face Urgency Politics Geography Community Project or event
  17. 17. Face • The “Face” of your campaign: is it appealing? • Celebrity not required • Beauty not required • Authenticity required • Person or critter • Logos can’t be the face of your campaign • Objects can’t be the face
  18. 18. Urgency • The urgency: is there a native reason people must act now? • Boston Bombing v. American Cancer Society
  19. 19. Politics • Is your cause potentially divisive? • Cancer v. Marriage Equality
  20. 20. Geography • Local v. Global
  21. 21. Community • Is your cause tied to a larger community, religion or club? – Alumni – Veterans – Football fans – Online gamers – Rotarians • Can you reach the community?
  22. 22. Project or Event • Is there a specific project or event to be funded? – Product launch – Research project – Construction project – Service trip – 10K Run
  23. 23. LiveMoreAwesome
  24. 24. Assessing Your Project • Rate your project on a 0 – 5 point scale for each of the four areas: – Face: __________ – Urgency: __________ – Politics: __________ – Geography: __________ – Community: __________ – Event: __________ • Total: __________ • A score above 25 has high potential to reach beyond your personal network. • A score below 15 is unlikely to reach far beyond your network. 23
  25. 25. • Reaching way beyond your network requires: – Marketing budget – Celebrity – Passion among your friends, fans and followers – Media attention (blogs, newspapers, radio and television) – Luck Going Viral 24
  26. 26. Platforms 25
  27. 27. Platform Considerations • Hundreds of platforms to choose among • Remember, the money comes from your network—not the platform’s • Few people are browsing the sites looking for places to drop money • There are 100s of projects on each site 26
  28. 28. Crowdfunding Timeline Phase I: Reconnaissance Phase II: Preparation Phase III: Ground War Phase IV: Air War Campaign 1 2 3 4 5 6 7 8 9 10 11 12 Phase I Phase II Phase III Phase IV Campaign Timeline in Weeks 27
  29. 29. Preparation • The activity you see in a crowdfunding campaign is a fraction of the total work • Start preparing in earnest 30 to 60 days before you launch your campaign 28
  30. 30. • Build and organize teams • Train your team • Organize lists • Design your rewards/recognition • Write a press release • Produce a video What to Prepare 29
  31. 31. Partners • Your business partners should be your crowdfunding partners • Get them committed • No one person can carry the whole team 30
  32. 32. Fanatics • People who will campaign on your behalf • Your mom • Customers who already love what you are doing 31
  33. 33. Train the Team • Train Your Partners • Have your partners help you train the Fanatics • Teach everyone what you are learning here 32
  34. 34. Partners and Fanatics Everyone prepares her own list Gather names, phone numbers and email addresses Download list from online email provider Download list from LinkedIn Organize Lists 33
  35. 35. Rewards • Nothing but thanks • Incentives • Products 34
  36. 36. Creative Appreciation For small donors, a simple, automated email expressing appreciation For large donors, be creative Be careful to ensure that the biggest donors get special recognition in addition to standard recognition 35
  37. 37. Premium Priced Rewards • Works for: – Causes – With creative appreciation – Social entrepreneurs – Launching a business with a compelling new technology • Use cheap things: – Tee shirts – Posters – Downloads 36
  38. 38. Products • Consumer-ready • Appealing • Buy one – give one
  39. 39. Powerful Press Release Press releases are fairly standardized Follow these instructions or use a template A press release is a pre-written newspaper article Make it sound like they did Use facts and figures and avoid marketing language 38
  40. 40. • Title • Subtitle • Introductory paragraph • Supporting paragraph • One or two quote paragraphs • About the company with a link to website • ### signals the end • Contact information Press Release Basics 39
  41. 41. Targeting Media • Each partner and fanatic should: – Identify bloggers and reporters with whom they have a connection – Identify bloggers and reporters who cover your “space” – Be sure to look for national as well as local media – Target local writers for Forbes and Huffington Post 40 Photo credit: Roger H. Goun,, creative commons license.
  42. 42. Video • Most important thing on your campaign page – Make an effort! • The page is not so important to your campaign – Don’t break the bank! – Budget less than 5% of your goal 41
  43. 43. Be Sure to Ask Ask viewers to: Donate Share 42
  44. 44. Crowdfunding Timeline Phase I: Reconnaissance Phase II: Preparation Phase III: Ground War Phase IV: Air War Campaign 1 2 3 4 5 6 7 8 9 10 11 12 Phase I Phase II Phase III Phase IV Campaign Timeline in Weeks 43
  45. 45. Line Up The Big Backers • Strategic partners • Suppliers • Distributors • Large customers • Wealthy friends and family • Target 3 to 5 who are likely to support you 44
  46. 46. Work the Phones • Every partner should work her own list • Choose 20 to 30 people from your lists – Most likely to support – Friendly to you or your project – Make this easy on yourself 45
  47. 47. Email—Not Spam! • Personal email messages can yield up to 50 percent results • Every email must be personalized • Do not BCC all of your friends at once • Email 50 to 150 people personal notes one at a time • If you have a commercial email list, use it, too 46
  48. 48. Commercial List • If you have a commercial list, you track results • A majority of your email messages go unopened • Most of the opened messages get no clicks • Go ahead and use your list to generate support • Getting 1 to 2 percent of your list to participate will be a big win 47
  49. 49. Track the Contacts • Keep a log of every contact • Don’t call someone twice who turned you down! • Follow up with email reminders weekly until they pledge online • On the first day of the campaign, remind them to go online to pledge • You want 50% of your total on day one (if only so you can actually get 30%) 48
  50. 50. Crowdfunding Timeline Phase I: Reconnaissance Phase II: Preparation Phase III: Ground War Phase IV: Air War Campaign 1 2 3 4 5 6 7 8 9 10 11 12 Phase I Phase II Phase III Phase IV Campaign Timeline in Weeks 49
  51. 51. Have a Ball! (or at Least a Party) • On the first day • Have fun! • Engage as many people as possible • Make giving easy • Create incentives for using social media • Announce contests for your “fanatics” • Be creative 50
  52. 52. How to Reach the Media • Don’t just send a press release and expect people to share it • Connect with the media; pretend you are dating • Give them a reason to care • Follow protocol • Send a second release • Be prepared for an interview 51
  53. 53. The Second Round with the Media • After the launch send a second press release • Highlight: – Success and momentum of the campaign after only one or two days – Talk about the party – Refocus on goals and/or the product • Provide links to photos and video of the party • Tell the story of a groundswell of support • Be available for interviews 52
  54. 54. Social Media: Where the Rubber Meets the Road 53
  55. 55. Keys for Good Posts • Announce funding progress – People want you to succeed – The more backers you get the more backers you get • Remind people why you are raising money – Focus on the product and its benefits • You can never thank people too much for their money and their trust 54
  56. 56. Coordinate with Your Team • Send an email each day to every member of your team • Include suggested posts for all of the main platforms • Be sure to include links to new media hits • Make it easy for them to be active on social media 55
  57. 57. It’s Not Over… • Keep your team engaged • Keep making phone calls • Keep sending personal emails • Tell everyone you meet about your campaign 56
  58. 58. Make a Coordinated Push • Rally the team • Update the media • Have another party • Make more calls • Send more email • Big finish 57
  59. 59. Vivienne – Make a Stand
  60. 60. • JOBS Act signed April 4, 2012 • SEC issued final proposed rules October 30, 2015 • Crowdfunding will be legal in 90 days 59 Investment Crowdfunding
  61. 61. • Broker Dealers – Will look and feel more like venture capital – Lengthy diligence and screening process – Most entrepreneurs will be rejected – Investors are waiting for deals • Platform Model – Very limited screening allowed – Everyone who complies can play – You’ll have to find your own investors 60 Two Models
  62. 62. • Raise up to $1 million per year • Lengthy disclosure required – iDisclose – Crowdcheck • Audited financials not required – Review required when raising more than $100k • Issuers can promote the offering but not its terms 61 Rules
  63. 63. Visit devinthorpe.com/jefferson • Today’s slides • My contact information • Unlimited email support 62 Q&A
  64. 64. Mid-life Crisis
  65. 65. You Are the Cavalry

×