Equity crowdfunding can present companies with a very considerable range of extra benefits over and above merely raising capital.

For starters, it is generally cheaper than raising standard finance and the companies only have to pay if the round is successful. So for cash flow it is neutral – any costs are covered by the raise. What’s more, you can extend the amount raised if your campaign is proving very popular, thereby possibly reducing the chances of another future raise and increasing the promotional penetration. Sure, you have to get it right, and to do this you do need to spend a considerable amount of time on preparing the campaign and getting together a band of initial investors, but its cash cost is minimal.

All businesses sell something to somebody. Equity crowdfunding can give companies an excellent free platform from which to promote their product or service. Whilst this works best for consumer products, it is also a benefit for B2B. Who wouldn’t want free exposure?

The equity crowdfunding platforms already have extensive membership numbers, with the largest one in the UK now totalling over 250,000. However, the promotion certainly does not stop there. Equity crowdfunding is hot news and if a business is clever about how it runs its PR campaign, getting free coverage in the national press is easy when it’s linked to an equity crowdfunding campaign. Equity crowdfunding has its own press clique which will always give campaigns coverage and papers like The Times and The Telegraph run frequent articles on this topic.

With America just about to join the fray big time, 2016 will surely see equity crowdfunding take off internationally and if a business has a global market this will be yet another free way to access it. A business could quite literally access the world market via one free equity crowdfunding campaign.

By definition, equity crowdfunding gives companies access to a vast wealth of business knowledge – the potential investors. Airing the campaign can result in connections and conversations which will go on to prove invaluable in the future. It gives the business a chance to run through scenarios and compare notes – often resulting in the company changing its practice on the advice of the ‘crowd’. This sharing of information and experience should be embraced. 

Investors act as a business’s very own army of brand ambassadors. Not only could you end up connecting with someone who might offer your company useful advice in the future, a successful campaign will give you potentially hundreds or thousands of people talking up your product or service.  Word of mouth is recognised as the most potent promotional tool and this is all for free. .

All these benefits are particular to equity crowdfunding, they are free and an automatic function of launching a campaign.  That has to be good news.