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Finance Focus helps businesses navigate the ever-evolving world of finance. Each episode features expert insights, practical advice, and in-depth discussions on topics such as crowdfunding, trade finance, angel investing and debt. Hosted by Tracy Smart from The Smart Team and Sam Jones from Satellite Finance.
[00:00:00] Tracy Smart: Welcome to the Finance Focus podcast. I'm Tracy Smart from the Smart Finance team and I'm thrilled to be co hosting this with Sam Jones from Satellite Finance.
[00:00:14] Sam Jones: Hello! In this first series, we'll be diving deep into the world of fundraising. So whether you're a seasoned business owner or just starting out, our goal is to provide you with some practical tips to help you navigate the complexities of raising funds for your business.
[00:00:26] Tracy Smart:
[00:00:26] We've been talking about crowdfunding and I'm very excited to introduce our two guests, but we want to just start off with some of your key learnings and what would be your top three tips for people who are considering crowdfunding? Tim, would you like to go first?
[00:00:43] Tim Hammond: Well, yes, I mean, we've done crowdfunding twice, two different businesses that I've done and I think on both of those, tip one is line up brand ambassadors or your community before you go anywhere near the platform. Get them warmed up, get them ready and motivated to help you to promote your business. So that's tip one, whether that's customers, friends and family, other associates that can talk about on social media to help promote your business, because it is all about getting the excitement behind your business. So I think that's tip one. A business plan and a pitch deck is not enough, you need to have much more around it to help you get the momentum for the business to go live on essentially a showcase that's going to run a couple of months.
[00:01:27] Tip two, very much about keeping that momentum going. Even if it's just £10 here, £20 there, set the bar fairly low on the investment so that everyone can come in and the more investors you get, the more likelihood is you're going to be showing towards the top of the leaderboard on the platform.
[00:01:46] And tip three is actually concentrate on the rewards you're going to give away to the investors, because all of the investors, or a lot of the retail investors who don't know you, may be coming in because one, it's an investment, two, it may be an EIS investment or SEIS, which is going to help, but three, they want some reward for that, whether that's part of your product or some other incentive for coming in.
[00:02:10] Sam Jones: Brilliant, thank you. And Geoff, your top three tips.
[00:02:12] Geoff Turral: So I think tip one would be touching again on that SEIS, EIS. First of all, make sure you can maximise your attractiveness to investors. If you're ES, SEIS applicable, make sure you get that and EIS and then while staying the right side of not being a tax advisor, make sure that you're communicating the benefits of whichever one you are through this scheme. You'd be amazed, relatively serious retail investors who've spent quite a lot of money, still not quite aware of the benefits and given where capital gains has gone recently, that side of things is really, really important. So tip number one, really understand and be happy to communicate while staying the right side of not giving guidance, the benefits of the schemes, the tax efficient schemes that you're part of. That would be tip one.
[00:02:55] Tip two would be to put a little bit of budget aside, you don't have to spend the money, but you get more communication if you go on the platforms you're looking at and put a little bit of budget, when I say a little bit, maybe £50, £100 and select a few campaigns and sign up, go through the process, understand what it's like to sign up for a crowdfunding platform because you have to go through a quiz to say that you're happy about the risks involved and so on and so forth. You need to understand all this because you're going to put people who've never done it before through it that know, so understand what you're going through and when you invest in those campaigns, you also see the communication, you work out what works for you, you see the regularity, you get a real sense of the excitement, the momentum, the consistency, the engagement that you need to foster and create.
[00:03:39] And then, so my final tip would be one that's optional and it's what we did, we went through two campaigns with one company, both successful and we did that with the support of a crowdfunding support agency. So have a really good look at that. Connected to this, is that if you're doing it once, then you absolutely need to do that and if you're doing it twice or three times, you absolutely need to do it all over again. The real big risk is that you treat a follow on campaign as something that's just going to be an automatic success rather than start from ground zero again and work through it all again. The killer for a crowdfund campaign from the investor side is the risk that you assume something and then you'll find it starts to unwind.
[00:04:17] Sam Jones: Brilliant. Thank you very much.
[00:04:18] Tracy Smart: Thank you.
[00:04:19] Sam Jones: Thank you for tuning into this episode of Finance Focus. We hope you enjoyed it, found our discussion insightful, engaging, and entertaining.
[00:04:26] Tracy Smart: If you have any questions or feedback, please feel free to drop us an email or you can find us on LinkedIn. Links are in the show notes. We always love hearing from our listeners and look forward to your thoughts, ideas and suggestions. So until next time, stay financially savvy.