Franchising, retail, business
05/02/2015
Four Signs That Your Business Isn’t Right For Equity Crowdfunding
Early-stage, high-growth businesses thrive on the equity crowdfunding market—a startup model most traditional banks and VC firms dismiss due to size and risk. More conservative businesses, though, often find success online too. Despite being of a different nature, the teams behind such projects share the same entrepreneurial spirt that attracts investors and gets things done.
With that said, failed campaigns also share some characteristics, so be mindful of the four conditions below, which suggest that your business isn’t right for equity crowdfunding.
Your Business Wants To Avoid Fundraising Publicity
Although some equity portals lockdown data more than others, there is still a general need for solicitation. For those interested in developing private relationships with investors prior to funding, there are may be better options to explore. If, however, the hesitation stems from a fear of failure, then perhaps your business isn’t right for equity crowdfunding simply because it isn’t ready either (See:project investment readiness and exit strategies).
Your Business Only Seeks Social Rewards
Social awareness is a key crowdfunding criterion, though the ultimate goal should still orient growth and stability—not just network size. For businesses looking to launch novelty campaigns, the intentions are ill-suited and this will show in the project’s presentation, thoroughness and reception.
Your Business Doesn’t Have Time To Spend
Many successful campaigns comment afterwards that crowdfunding feels like a full-time job. If a campaign will affect your business’ operations, then maybe you should postpone or forget the idea altogether. You need an open schedule for promotion, engagement and management, not one that conflicts with other day-to-day tasks. After all, you do not want to stifle your business’ own growth potential due to poor planning.
Your Business Never Surveyed Other Options
Although a tightening market, businesses do have alternatives apart from crowdfunding. If allured by the hype, take a few steps back before launching your campaign: this is not an act to do in haste; nor does every business suit the crowdfunding model. Thoroughly investigate all other funding options before setting parameters for your campaign.
Fonte:http://www.crowdclan.com/business-isnt-right-for-equity-crowdfunding/