South Bend, IN (PRWEB) April 30, 2012
Small businesses are anxiously waiting for the SEC to put the final rules in place so that they can start crowdfunding innovative, entrepreneurial ventures. In what PR firm Ugly Dog Media has termed an “initial crowd offering”, or ICO, small companies are now able, for the first time, to raise capital of up to one million dollars from a group of small investors putting in up to $2,000 each through a registered Internet-based crowdfunding platform. The investors receive an equity stake and the potential for a meaningful financial return.
Part of the recently-enacted JOBS (Jumpstart Our Business Startups) Act, crowdfunding for the first time opens the door for small and SOHO (small office/home office) businesses to get the investment funding they require to succeed. Now that crowdfunding is allowed by law, the SEC has 270 days from the date of enactment to put together the final foundation and guidelines for how exactly it will work. Until that day later this year though, the many crowdfunding platforms remain in waiting mode.
“Although the crowdfunding sites will not go live until near the end of this year, there is still a lot a small business can do, and needs to do to get ready right now,” says Dan Blacharski, president and international PR firm Ugly Dog Media. “Although you will have an opportunity to describe your business on your crowdfunding listing, most investors aren’t going to make a decision based solely on a 300-word pitch. You need more, and savvy entrepreneurs are already getting their ducks in a row to make sure they have everything in place.”
Blacharski says that as part of the crowdfunding pitch, a small business will still need to put together a set of very specific types of marketing documents, including a brief prospectus, private placement memorandum, brochures, single-page elevator pitches and web sites. “Even if your business isn’t up and running yet, investors will need to know you’re serious about it, and you need to demonstrate that your concept is well thought out.” Blacharski, a veteran PR expert who got his start during the heady days of the dotcom boom, advises small businesses to get started now.
And although a small business is not yet able to take investments through the crowdfunding platform, what they can do, according to Blacharski, is create initial excitement, talk to potential investors, and get “pre-commitments” in anticipation of the crowdfunding go-date. “Naturally, if you have everything in line, and have 100 or so investors ready to transfer funds on the first day of issue, you’re going to be ahead of the pack.” Ugly Dog Media assists companies with this very specific type of marketing, through its Crowdfunding Jumpstart service. The service, which goes beyond ordinary PR and marketing, fills the very specific requirements of a new or emerging small business that desires to gain investors through crowdfunding.
“On the first day the crowdfunding sites go live, there will be a rush, both on the part of businesses seeking funds, and the investors that have it. If you wait until that first day to get your documentation and marketing pieces together, you will miss out on that initial momentum and excitement,” says Blacharski. “Those that have everything ready to go immediately, including informative and fully detailed investment-oriented marketing documents and an initial group of investors that have already expressed interest, will have an opportunity to take advantage of that initial crowdfunding buzz and get in on the first wave of funding to come out of it.”
About Ugly Dog Media
Ugly Dog Media has been providing Agile Creative Development & Content since 1991, and is powered by a team of marketing professionals who are skilled in corporate marketing and public relations, web content and development, search engine optimization and marketing, and social media marketing and forum management. The company, based in South Bend, Ind., has worked with some of the largest corporations in the world, from L.A. to Hoboken to Hyderabad, and specializes in providing Madison Avenue results without Madison Avenue pricing.