Win the Crowd
Four entrepreneurs explain how their companies raised money the newfangled way—from everybody.
By Victoria Finkle and Kathy Kristof Illustrations by Peter Arkle
Want to turn every customer or friend into a potential backer of your business? Since
regulations changed in 2016, small businesses have been able to raise money from
non-accredited individual investors. While equity crowdfunding, as it is now known,
can be complicated and expensive, it’s also been lucrative for some businesses that
have taken the plunge. Over the past several months, Inc. followed four founders
and CEOs who raised money from big groups of people. What they learned: There’s
no one right way to crowdfund. You can do this sort of fundraising on your own,
or you can rely on third parties; three of the following startups paid a commission to
use a new Indiegogo platform, which handled their technical and marketing and
investor-relations headaches. You don’t even have to stick to selling traditional shares
of your business. Indiegogo lets the companies that use its equity platform sell debt
or preferred stock or other securities instead. (Several of these companies also
thanked their investors by giving them sample products, T-shirts, or other types of
the rewards that crowdfunding first became known for.) So if you’re curious about all
of crowdfunding’s possibilities, the companies in the following pages explain why it
worked for them–and why it might someday make sense for you.
e i n e y— r b .