Healthy cosmetics business shows how to succeed with a crowd funding campaign

Having set a target of £100,000 to raise from investors through a crowd funding campaign, healthy bee based cosmetics business, Bee Good, concluded the month long exercise with an investment of over £230,000.

Founder and CEO of Bee Good, Simon Cavill put the success down to a series of key factors.

‘We chose to raise investment to help us grow the business, increase contracts and provide the stock necessary to fulfill them. Crowd funding was seen as a good way to do so as we were a mature business with a five year profitable history, and the type of business that would appeal to small investors who we could reward with our products. We also saw crowd funding though as a way to grow our brand profile, and in that way also build sales.’

Simon Cavill emphasised five rules to follow when undertaking a crowd funding campaign.

* Get the business story really clear. Show that it is successful and well established, and that the reasons for raising the investment are equally clear and sensible with a realistic prospect that the value of the business will grow as a result. Global growth is helpful, as that attracts overseas investors as well as domestic ones.

* Be fair and respectful of investors. A successful investment round is one that both investors and the business feel is fair in terms of valuation and conditions. Don’t expect that you can just choose your valuation and expect investors just to sign their cheques.

* Get traction in advance so that as soon as the crowd funding invitation is open to the public, there is an immediate take up already in place. Ideally this should be at least 30% of what you want to raise. This together with the prospect of an EIS based tax efficient investment will encourage others to join.

* Have a product enticement attached to the offer. This isn’t just a thank you gift. It’s a great way to increase brand awareness too at a very low cost. But the investors will see it proudly as a justification for their investment.

* Maintain the information momentum during the campaign. Updates, news, new contracts. As much noise as possible both on the crowd funding site, through newsletters, in the external media and in social media. The more that trusted independents are talking about the business and the opportunity, the more potential investors will not want to miss the opportunity.

Following this approach Bee Good were not only ably to raise more than twice the amount they set out to, but they also welcomed into the Bee Good family 460 investors from 24 different countries which has given them more new brand ambassadors than most businesses enjoy, and represents a valuable base for future investments and sales.

ENDS


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