Intrastate Crowdfunding: Raising Capital from the

CommunityDavid Dupee, Founder & CEO

Intro to Crowdfunding

•Rewards (kickstarter): emotional connection, try new products

•Accredited investors (CircleUp): financial return

•Retail/general public (CraftFund): “Packers Plus” mix of emotional and financial

Intrastate Crowdfunding Probably Won’t Fund Next

Facebook•Not clear how VCs and other institutional investors will view crowdfunded companies

•Adverse selection: institutional investors already focused on certain verticals

•Tech and certain B2B companies might not meet test to qualify as company doing substantial business in WI (80% of assets, revenue, and offering proceeds come from in state)

Intrastate Crowdfunding Likely Works Best for Main

Street Biz•Consumer and place-based businesses have added marketing incentive to build brand advocates

• Investments easier to understand and do due diligence on

•Millennials key demographic

• Future investor class: 75M

• Already familiar with crowdfunding

• Different approach to investing

What the Limited Data on Investment Crowdfunding

Shows•U.S.: Title III of JOBS Act yet to take effect. Other

exemptions used to allow general public to invest online:

• intrastate: guitar company, brewery

•Reg A: real estate

•UK.: Investment crowdfunding legal for 3 years with consumer products as one of the strongest categories

Sound Familiar?: BrewDog Example

“Our strategy has always been to try to shorten the

distance as much as possible between ourselves and the

people who drink our beers.” -BrewDog

•Scottish brewer raised nearly £4M by turning 12,000 fans into shareholders

“Very quickly it became clear that the excitement was as much about belonging somewhere as about money.” - Harvard Business Review

What Does this Mean for WI?

•Getting ahead of the curve: 10 states have since passed similar law

•Economic development

•Restaurants largest private sector employer in state

•Food and beverage manufacturers account for $10B in revenue and key driver of tourism

•Attract and retain millennial workforce

David Dupee, Founder & CEOCraftFund LLC

www.craftfund.comdavid@craftfund.com

@CraftFund @CraftFundWI