Updated: Mar 31, 2021
We’re excited, no STOKED, that the rule amendments to the Reg CF have been filed in the Federal Register and will be effective at the end of Q1 2021.
Previously amended Reg CF details include:
Increase the cap from $1.07M to $5M
Ability to run “Test The Waters” or a pre-launch campaign
Increased accredited investor investment limits
Issuers can report Reg CF investors as one investor on their cap tables
We firmly believe that the new regulations will create a major shift in the industry.
The New Regulations Will Create a Major Shift in The Industry
For specific marketing predictions check out our blog, “What Does the New Regulation CF Expansion Mean for Equity Crowdfunding Marketing?”
For the meantime, here are tips to help you leverage the new SEC regulations in 2021
Tip 1: Set up a Test-The Waters Campaign
The new SEC regulations allows you to run PRE-LAUNCH campaigns! This will allow you to:
Gauge the interest in your campaign
Build a large prospect email list before launch
Build more brand awareness and excitement on social media
Pro-Tips to crush your Test The Waters Campaign:
Use FB lead form ads to grow your email audience
Create a follow campaign to grow your social media audience
Tip 2: Target More Accredited Investors for Reg CF
Accredited investors no longer have limits on how much they can invest in Reg CF campaigns. In addition, Reg CF investors are listed as one investor under a cap table, which makes Reg CF opportunities more attractive to accredited investors.
Pro-Tips to Reach Accredited Investors:
Create a Video of You Presenting Your Pitch Deck and Share on Social Media
Host and Investor Q&A Webinar
Write a Blog Article Discussing The Market Opportunity
Showcase as much business momentum such as new partners, team members, acquisitions, revenue streams, or product developments.
Invite an Accredited Investor to Leave a Written or Video Testimonial
Attend online networking events in your industry
Join investor groups on Clubhouse
Invest in LinkedIn Outreach
Tip 3: Tap New Audiences on Upcoming Social Platforms
Clubhouse is an audio-based social media app. The company describes itself as "a new type of social product based on voice [that] allows people everywhere to talk.
Here’s What You Need to Know:
Works with real-time rooms where you can speak to and engage with professionals in your industry or niche. The focus is on high-value conversations
Founders and Investors are engaged in the platform which turbocharges business opportunities. Check out this Entrepreneur article describing how Kevin Harrington from Shark Tank hosts a room with other investors to listen to pitches from entrepreneurs.
You need an invite to the platform to get on
Don’t be afraid to join rooms and speak up
Host your own room for topics in your industry or investment opportunities
Tik Tok has gone viral fast in only a few years. As a young and fast-growing platform, there is a huge opportunity to garner a big audience of non-accredited investors.
Here’s What You Need to Know:
Non-Accredited investors dominate Tik-Tok. Investment messaging should be straightforward and focus on emotion, rather than hard business stats accredited investors would be more interested in.
Tik-Tok influencers are cost-effective to free. If you have a product ideal for influencer marketing, Tik-Tok is ideal
The Tik-Tok algorithm is very specific which will allow you to reach a niche audience quickly, unlike Instagram which is flooded with ads
Follow current trends on Tik Tok
Keep your content fresh and young in a way that fits in with your brand
Don’t be afraid to use Tik Tok effects on your post
Use Tik Tok Ads
Use sustainable hashtags
Tip 4: Pay For Paid Features on Robinhood, Motley Fool, Morning Brew
As more retail investors learn about equity crowdfunding publications around equity crowdfunding will become mainstream to more millennials.
Robinhood, Motley Fool, and Morning Brew have high readership from millennials and the Gen Z generations, thus a publication in one of these can give your brand huge credibility.
Tip 5: Host and Attend Events (Demo-Days)
In anticipation of the COVID vaccine in Q2 2021 and things returning to “normal” issuers should take advantage of people being able to go outdoors and to events again.
You can do this in the following ways:
-Host a launch party for your personal network
-Invite accredited investors to dinner
-Host an experiential event for the first 100 investors
-Go to networking events and “festivals” where you can promote your product
2021 is a Year of Big Changes and Opportunities in Equity Crowdfunding!
In January and February alone we’re seeing:
More startups turn to equity crowdfunding as an alternative to VC funding
More investors invest in equity crowdfunding
Raise success rates increase
Raise amounts increase
More portals emerging
More publications emerging
More competition in the industry
Better and more accessible regulations
In the first 21 days of the year, equity crowdfunding raised more investments than the entire month of November 2020! That’s huge momentum, and we’re only anticipating more.
If you’re curious to learn more about equity crowdfunding and equity crowdfunding resources, please check out the following resources: