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How To Raise Funds for Your Startup Through Crowdfunding

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How To Raise Funds for Your Startup Through Crowdfunding

By Startup Valley (553 words)
Posted in Crowdfunding on September 17, 2012

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With the current state of our economy, it has become more difficult than ever before for startup businesses to secure funding from banks and various other financial institutions. With the birth of the JOBS Act, companies will have the ability to raise funds through the crowd and in exchange, give a portion of equity in their company for each related investment. Below are some basics about crowdfunding and how you can raise funds in order to support or launch your new startup or business idea.

Spread the word

Sharing up to date information on your startup by utilizing social networks is a great way to create a presence for your upcoming business. Posting about your startup can help you build multiple followings which will hopefully lead to a shared equity in your company. This is a great way to promote your startup to people you have trustworthy relationships with such as: long time friends, family, and co-workers. Utilize your existing professional contacts on Twitter and Linkedin as well, this will allow your connections and followers to see that you are serious about launching your startup. By keeping your network informed can also help create a “buzz” about your new company, and possibly lead to building even more professional connections which can be beneficial to you upon launching your business.

Create a video

Creating an informative video can help your company stand out from potential competitors. By talking about your startup in further detail, viewers will be able to “meet” you as a person, and gain insight to your new business. Viewers will appreciate the fact that you took the initiative to put a video together for your startup. Once your video is posted on YouTube, you will be able to interact with other video bloggers and startup channels. By doing so, viewers and potential investors will be able to see that you are able to build a loyal fan base. Filming videos allows people who come across them to feel a personal connection to you. If you are able to keep up with posting videos on a regular basis, it should allow you to create a following, and can be used as additional evidence that you are putting a high amount of effort into your startup, including people that are looking to share equity in your business.

The Future of Crowdfunding

While no guarantees about the future of equity crowdfunding can be made, there are several predictions which can, and will hopefully be close to accurate. It seems clear that through online crowdfunding, creativity and innovation will follow as well. It is also possible that online crowdfunding will have an effect on banks as well as other financial institutions. Crowdfunding will absolutely make it easier than ever for companies to raise capital in order to achieve the success they desire. If the idea and concept that you pitch for your startup is unique from existing companies, as well as innovative, people will be intrigued and want to share equity in your company.

Additional Tips

• Your main goal is to attract people who are genuinely interested in your idea

• Build your following

• Focus on your future company goals

• Treat CF funds raised as an additional source of funds

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