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Crowds with CashAlternative Financing is a Mixed Moneybag
of Opportunity for Small Business
Hello!
Welcome to Manta’s Small Business Expert Series
Thanks for joining us today.We’ll get started right at 2 p.m. EDT
Today’s webinar sponsored by #mantaexperts
Crowds with CashAlternative Financing is a Mixed Moneybag
of Opportunity for Small Business
Today’s webinar sponsored by #mantaexperts
Resource listTechnical ?
Q&A
Enlarge the slide area
“Banks slashed small business lending
by $43 billion.” –CNN Money, February 11, 2011
The Story
“The numbers back up what small business
owners have been saying for two years: Main Street
suffered a brutal credit crunch.”
“The future is looking bright for alternative lenders.” –CNN Money, December 18, 2014
Better
Story
“Crowdfunding bill passes assembly.” –NorthJersey.com, March 11, 2015
See the latest Manta research on alternative funding in the resources widget
We’ll Talk
AboutCrowds with Cash
1. Meet the expert: Joe Hogue2. Meet the crowds:
Reward & donation based crowdfunding*Using crowdfunding as a marketing strategy*
Equity crowdfunding Peer-to-Peer lending
3. What you want to talk about: Q&A with Joe
Meet Our Expert
Joseph HogueAuthority on alternative financing & emerging markets investing. Also a blogger, business owner and guy who rocks a bow tie.
Click on the speaker widget to learn more about Joe
Raising money from a large number of people, typically over the Internet
About so much more than just raising money
Crowdfunding
PlatformsKickstarter
• 13M monthly visitors
• $1.5B pledged• All or nothing• No social
projects• Campaign must
be reward or product based
• 15M monthly visitors
• Fixed or flex • 7,000 active
campaigns at any time
Indiegogo
GoFundMe
• $810M raised• 9M donors• Keep $$
• Medical, travel, education
• Flexible model
Open the resources widget for Joe’s comprehensive list of major crowdfunding platforms
Is there a deadline?
Is it an all or nothing or flexible funding model?
Do they charge a percentage or a monthly fee?
Do they only accept rewards-based projects ?
What about support and education?
Questions to Ask Crowdfunding Platforms
Time-consuming
All or nothing?
Unrealistic expectations
Materials and processes in place
Extends your business online
Business transaction, not fundraising
Crowdfundin
g
Heroes and Heels
Goal $4,000
Purposeconvention booth fees and travel
For
Example
Crowdfunding
Example
Operational• Asked for $10K for
retail build-out• Partnered with local
non-profit• Raised $6K and will
donate 1200+ loaves of bread to a community food pantry
Open the resources widget to visit the All Crumbs Artisan Bakery website
#1 Crowdfunding Benefit
It’s about so much more than the money
A willing audience interested in you and your success
A free page dedicated to your business
Investor groups regularly surf crowdfunding platforms
Feedback and sense of community
Cheerleaders for your brand
Marketing!
Learn more about these guys with Joe’s blog post “What are You Really Getting with Equity Crowdfunding?” in the resources widget
Accredited Investors
Equity
Crowdfunding
Crowdfunder
• $194M in deals• 21,700 companies
• $299 monthly fee
• Requires term sheet, investor pitch deck and
summary
CircleUp
• Consumer & retail• Requires $500K in
annual sales• Funding takes 2-3
months• On-site experts
• Both rewards & equity-based
campaigns• $179 fee for equity
campaigns• Fee plus 3.5% per
transaction for rewards-based
campaigns
Fundable
Equity Crowd
Platforms
What types of businesses do well on the site?
How much support is offered?
What are the revenue requirements?
Is there an active community of investors?
Questions to Ask Equity Platforms
Selling off part of your companyPuts you on the radar of venture capital and private equity firms
Equity platforms entering IPO market
You may have to share control and profits
Priceless advice
Try rewards-based crowdfunding first
Equity
Crowdfunding
Open the resources widget to read Joe’s blog post about Mine Shaft’s success
Start-Up• Asked for $400K seed• Raised $665K in 4
months
Equity
Example
Investors go straight to the source to invest in small business & personal loans
The platform acts as the online administrator
Peer-to-Peer
Lending
Lending Club
• $1B every 3 months
• Allows non-accredited investors
• $35K personal• $300K business• Fixed rates
Lendoor
• Crowdlender• (combines CF & P2P
models) • Borrower decides terms
• Anyone can invest
• Business only• $50K max
• Auction model funds at lowest
rate bid• Focus on veterans• Platform invests
5% in every loan
StreetShares
Peer-to-Peer
Platforms
Open the resources widget for Joe’s comprehensive list of major peer-to-peer platforms.
Is there a pre-payment penalty?
Are rates fixed or is there an auction process?
What are the terms?
Can non-accredited investors participate?
Questions to Ask Peer-to-Peer
Platforms
It’s debt that has to be repaid
Very high interest rates on short terms
Relatively fast and easy
Most loans funded within a day
60% approvals
There are predatory platforms targeting small business owners–educate
yourself
Doesn’t compare to benefits of crowdfunding
Peer-to-
Peer
Open the resources widget to read Joe’s blog post about Combat Flip Flops
Start-Up$30K for 3 years23% interest ratePaid off early200-400% yearly growth
Peer-to-Peer
Example
Use the Whole
Crowd
Many companies use a mix of equity and debt funding
Crowdfunding offers marketing, outreach and exposure
Peer lending is fast and flexible
Today’s webinar sponsored by
Ask
Joe
Connect with Joe and other business owners in the Manta community
Chat with Joe on Twitter immediately following the webinar#mantaexperts
Open the resources widget to get more information about our April webinar
Manta believes in empowering small businesses to achieve success. We’re inspired by your determination and energy. And we understand that every company is unique.
We strive to provide the marketing tools and educational resources you need to stand out, connect with your customers and your peers, and grow your business.
Send us a note and let us know what you’d like to learn from upcoming webinars like this one.
events@manta.com
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