CrowdFund Roundup’s
The Day in the Life of a CrowdCo
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Introduction
In building this narrative we are recording the thoughts oftwo Creative CrowdCos as they set out to bring their “idea” to market through the Crowd.
We start with our inner belief in the CrowdCreative Process:
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CrowdSourcing allows teams to build where they are planted while accessing quality resources around the country and around the globe.
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CrowdFunding brings a paradigm shift to the capital formation process of start-up ventures. It does not replace or compete with Angels, VCs or Banks but fills in the missing segment of the start-up lifecyclecash flow effectively.
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CrowdMoving our new process initiative takes the wave of open community participation to its finalobjective including the crowd in the entire lifecycle of the product/service. They came and joined in the development and funding of the project; why not let them participate in the selling and profits of the work they accomplished.
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CrowdCreative Companies invest in their ultimate customer from the moment their great idea takes shapeand maintain real effective connections throughout the product/service lifecycle. They have no objections tocreative corporate structure or fear of distributive workplaces. They just feel safer involving their customer in the process from the very beginning. Crowds make great things happen.
Table of Contents
Introduction1
Table of Contents1
Project Update Highlights2
SAFE:2
MeCareHealth3
Fourth Step in CrowdCo Lifecycle:3
Every touch by the Crowd contains critical information for the CrowdCo.3
Understanding the Investment Sale4
Keys to Solid CrowdVestor Communications5
Personal note from CR Team6
Project Update Highlights
SAFE:
While delay is never considered a positive element in a business plan it is many times a prudent decision. As we put together our plan for a non-equity raise we found a number of critical product enhancements we felt were necessary before moving forward. This will delay our product delivery process and therefore extend our pre-sale timeline too far for our comfort. We choose not to bring our customer to a place where they have to wait and wherewe cannot provide a definitive timeline.
Maybe it is the recent articles on non-delivery but we think a little caution will serve us better than rushing into a campaign.
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SAFE will use CrowdFunding, both Equity and Non-Equity as a vehicle for building capital resources
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SAFE will commit to making the crowd an integral part of its full product lifecycle.
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SAFE will endeavor to have a campaign ready for release starting in the New Year where we believe the Crowd will be more attuned to our product’s capabilities and value.
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Finally SAFE will continue to work with CrowdFund Roundup on this article and continue to build and test the processes and procedures being developed during this research article’s creation.
This is a very exciting time for SAFE and its development team. Not pushing for a 3rd/4th quarter CrowdFunding Campaign hurts a little in the pocketbook but supports our commitment to excellence built into our corporate culture.
What we release in February will be the best SAFE we can bring to the Crowd and truly meet and exceed the “Added Value” expectations of our customers.
MeCareHealth
As with all enterprise endeavors the customer must come first. In opening the conversation about CrowdFunding we have been approached first by advocates of our endeavor and then by potential major clients. This is great news but does push back our ability to prepare and choose the type of CrowdFunding that is appropriate at our stage of development.
We will report next issue on our progress to date and our continuing approach at funding this exciting project.
Fourth Step in CrowdCo Lifecycle:
Every touch by the Crowd contains critical information for the CrowdCo.
We will start today’s discussion with failure. Being the positive sort (some call me a dreamer) this is a function of solid process management for me. Make sure you take a real look at the other side of the coin flip.
So we will start by stating that our CrowdFunding Campaign failed to meet its minimum goal – now what?
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Did we learn something?
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Is it a minor change in the product packaging, a full rework of the design, or has the market not materialized?
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Did we have technical difficulties that can be overcome (Social Media Marketing or presentation issues)?
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Should we try again – right away or let the dust settle?
The wonderful news about failure in CrowdFunding is that your answer might just lead you to a better corporate result. We know that Edison was not adverse to failure (anotherway not to build a light bulb) and that all the wonderful business coaches will tell you that adversity makes you stronger. I believe that CrowdFunding, handled correctly,will do this and much more. But you need to prepare to gather the right data before you move forward with your campaign.
Many (if not all) CrowdFunding Platforms maintain privacy or allow clients to remain anonymous. They are not your customers until your campaign succeeds, or they contact you directly. Therefore you need to be proactive from the very beginning:
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Make sure your campaign provides many links to your website and reasons for individuals to:
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sign up for your newsletter,
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contribute to the beta advisory board,
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Make sure your CRM is gathering and monitoring these connections and working towards long term relationships. You are not going to get “warmer leads” even if you paid for them.
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And make sure negative comments are handled within __ hours. You fill in the blank but if it is more than 48 hours you need to start thinking about a different line of work.
I like the fact that the CrowdFund Portal keeps their clients’information. It provides people a reasonable expectation of privacy and the ability to kick the tires without getting inundated with sales pleas. I therefore believe you need to build all your responses and actions from these connections with a level of professionalism. All links from the portal should be treated as investor inquiries and responded to without being pushy. – leave the sales efforts for later.
Now we can move back to our goals and success. Let’s talk about the conversation we need to have on a continuing basis with our CrowdVestors.
Understanding the Investment Sale
When you sell a product there is an arm’s length transaction and a closure of the responsibility. (Yes I know all about recalls, etc., etc, etc. But those are really product costs associated with useful life of the product built into your product model.)
Here you are selling an idea and a chance to participate in a new venture and the “handshake” is a long term relationship.
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When we speak with our Angels and VCs they already understand and ask us to identify the exit strategy laying out the path for a successful relationship. We give you X cash; you work on product Y for Z time; and then you give us back $$$.
When we speak with CrowdVestors we have a similar discussion but we need to provide a more open conversation. Both parties may not be in total sync with the process. This is not speaking down but expanding the explanation to eliminate shorthand that has grown in the existing Capital Formation Process. The words “Exit Strategy” are understood by CrowdCo and VC but may not answer the CrowdVestors’ question. Be prepared to provide easy to understand plan for the investment.
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When we accept funds from Angels/VCs they place managers on our Boards. They understand that they are part of the process for controlling funds dispersed. They also tranche the funds so that we have milestones to reach for continued funding.
Our CrowdVestors will not have the resources for managing control but will have the same need for project oversight. We need to provide this if we are to be effective and proactive. Check out Mentro4biz and their take on the information delivery process. Mike and his team have become very good friends of CR.
When we sell our golden widget we all want our customer to be delighted and happy for years to come. We know that this is the real way of gaining a solid customer base and success in our business. It should be no different with CrowdVestors. We should want them excited on the first day of investment and ecstatic when we finally exit the investment process. If we set up a process that seeks less than this we set ourselves for failure.
Keys to Solid CrowdVestor Communications
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______you fill in the blank____
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Let the CrowdVestor tell you….
Personal note from CR Team
We are looking for 10 great cities…
If you think your city or community is one of the best in the nation I need you to contact me.
The first 10 Cities to join up with CrowdFund Roundup will be the core of our expanding program and guide us as our CrowdAdvisiors (hey someone help me make up better titles).
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Become a part of the CrowdFunding Process by starting your own CrowdFund Roundup in your city or community. We will work together to provide a consistent message that supports our communities and advances the CrowdCos who come to our programs.
Contact me for more details
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