Does crowd funding work?

MrTanner

Free Member
May 11, 2009
36
6
That's a fair point. There are many good fund efforts that never make it, although would you say going viral is luck or good marketing?

It seems unless it's a 3d printer (there's a lot of these at the min) then raising a big sum is a real challenge
 
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PaulThompson

Free Member
Business Listing
May 27, 2010
421
1
59
York
acorn.finance
Hi Ian
We've been using crowd - funding for the last few years, we're getting to know very well what will work and how to get the best deal for our clients
There are different models of funding (debt, equity or benefit) and different providers in each sphere, you are only really going to get one shot at the goal so you have to get it right first time.
Drop me a pm if you'd like to explore it a little more confidentially and then perhaps move forward with the funding.
KR
Paul
 
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garyk

Free Member
Jun 14, 2006
5,992
1,019
Bedfordshire
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B

businessfunding

does crowdfunding work - yes

Is it an easy route to money? No.

You need to find the right platform for you and put together a highly compelling proposition - just as in any type of fund raising.

We 'do' crowd funding (debt finance) it can be very effective but the barriers are at least as high as for private money.
 
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I have done crowdfunding successfully. I have also raised money from angel networks and institutions.

I am presuming you are referring to equity fundraising rather than rewards based funding? They are both very different. The latter I know nothing about, other than it seems rather silly that someone recently has been allowed to raise a lot of money for a potato salad (though I think it's great fun!).

Crowdfunding, for equity, in the uk is simply a platform for receiving cash. When you are raising cash you need to sell your investment. Mainly that is done face to face. Successful pitches on places like Crowdcube tend to have a load of investors lined up before they go live. So what may seem easy, is in fact not quite the case.

The best way of raising cash is through meeting people, or getting someone else to sell the concept for you, for a commission. If you raise cash via crowdfunding for equity website, get to 70% and the crowd kicks in. You'll get to where you need to be.

If you want to chat about this, feel free to pm me.

Good luck.
 
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for what i know, it worked like a charm a few years back... but now it's loosing interest
I am not sure I quite agree with that. Whilst I don't think it will take off in the uk in the way envisaged, it can be done.

I say again, unless you have interested parties ready to invest, then it is hard work. I know a few people who have used it as their sole fundraising tool and who have failed. Most pitches do fail. Interestingly Crowdcube has just raised several million quid. It took them12 minutes, they claim it is the fastest funded pitch ever, in the world. What they didn't tell you was that they were backed by a small number of vc's, so when they opened the fundraising they already had most of the cash lined up. So it was pretty easy for them to convince their retail (ie every day joes) members to get in with the VC's. They are opening offices all over the place too. What I don't get is how they will make it. They take 5% on funds raised (and sell their software overseas). If they use it as a platform for investors to come in via third part introducers, you are looking at a doubling of fees. They are looking to get up to a team of 50 now.

I think this will be a slow burn. What they lack is a ruthless sales capability, ie selling the pitches to their members. They are quite a passive business in that sense.

You will see that most investment is done via high net worthy already introduced to the company which is pitching. Which begs the question, why bother with Crowdcube other than as part of the overall marketing mix.

Of course, I could be wrong!
 
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