Life as an entrepreneur is a stressful and ambitious venture, requiring dedication and energy to keep positive and, potentially, succeed. When a company is ready to pursue the benefits of raising finance from investors, there are many factors to consider besides legal documentation and due diligence checks. Marketing is one key component that is often neglected.
Raising awareness before a funding round, keeping investor momentum during the raise and maintaining communication with investors after the round has closed are all vital marketing strategies. Experienced investors can become business mentors, so it is crucial to keep communication channels open at all times.
Companies that have raised finance via equity crowdfunding have contributed to this article, to let us know which key marketing tactics paid dividends in engaging investors, and creating exposure for their company and funding round.
Companies raising funds need to make themselves available to provide quotes to journalists and complete interviews about their product at all times during the raise. One company director went as far as to suggest that they have had more feedback and coverage when contacting journalists in the afternoon rather than the morning and by email instead of by phone. Target publications that are writing about your industry; if you are a Fintech company, target sites which write about Fintech. When contacting specialised press and websites, try to link your company to something that is topical and then relate how your product or service is useful for this.
Other feedback has highlighted the importance of local press, who are often keen to cover new businesses from the area and are supportive of innovative projects. This has the added advantage of engaging potential investors in your local area and therefore people who are easier to meet in person.
Events, meeting and greeting
This leads us nicely into discussing event and the exposure a company can achieve via pitching at investor events. It is worthwhile seeking pitching events in the local area and where possible also host your own ‘meet and greet’ events, inviting potential investors to come along and learn more about the company and its prospects. This is where contact with local press can again be a goldmine, encouraging those in the local area to visit you and your company in person.
While raising funds, there are challenges to promoting via social media channels due to financial promotion regulations, but it can be useful to publish regular, well-thought-out posts on Facebook, LinkedIn and Twitter. Inviting followers to meet and greet events is one simple idea which personalises your fund raise.
Case study - Inn Style
We spoke to the CEO of Inn Style who raised £150,000 via SyndicateRoom in February 2015 to focus on customer acquisition for its quick, slick and simple software solution for B&B owners. The company offers a holistic place to manage bookings and payments, measure progress and communicate with guests using customised emails.
To effectively market the Inn Style funding round on SyndicateRoom, CEO Adrian Melrose actively encouraged investors to get in touch directly, arranging calls with investors to answer any questions they had about the company. The Inn Style team also held an investor event to build contacts and network face-to-face. According to Adrian, engagement one-on-one with potential investors prior to close was absolutely critical to the success of the funding round – as was prioritising marketing throughout the process. This required work and dedication to open up as much interest as possible: ‘You cannot just build a profile on any platform and expect investors to come.’
Adrian further commented on the benefits of meeting potential investors in person:
What’s different about it is they’ll spend more time understanding the business model. For businesses like Inn Style, this is what was so valuable because there’s a long and a short game to our business and it’s difficult to explain this to the average investor. The investors that came on board in our raise have been immensely supportive and have added real value over the last two years.
These insights provide a clear indication of the impact which marketing can have on the entire approach towards building and maintaining momentum for a funding round: one of the most important journeys for any startup. Communicating directly with potential investors, making yourself available to answer questions, and putting in the effort to reach out to wider audiences are all key tactics for spreading a positive message about your company and the enthusiasm you have to succeed.
For any further information about raising business finance, please visit the SyndicateRoom raise with us page.