This is Part 3 of a 6 part series on why Crowdfunding platforms are the new stock exchanges and why they will need to learn from exchanges like NASDQ, NYSE and LSE to self-regulate and provide a wide range of ancillary services that help campaigns succeed and at the same time, create revenues for the platforms.
The one truth about crowdfunding campaigns that applies to all across the board is this: Without a well-planned and executed promotional strategy, funding success is not likely. Whether a company is seeking rewards-based, equity-based, or debt-based finance alternatives, funding is contingent upon successful campaign publicity.
NASDAQ is real good about offering services to companies seeking funding on its exchange. Some of the most robust products are the media and distribution services they offer, such as:
GlobeNewswire, NASDAQ’s global press release distribution service
- Media contact lists
- Media analytics
- Public relations (PR) webcasts
- PR websites
- Digital media distribution, including video distribution and events management
In other words, helping companies develop a media strategy while providing tools and resources for those companies to better manage that strategy not only helps those companies get the funding they need, but it also helps NASDAQ. By the same token, crowdfunding platforms can benefit by offering similar services.
How Newswires Work for Crowdfunding Campaigns
There are a number of newswires today, and many of them are a great fit for crowdfunding. Tom Madden, founder and chairman at TransMedia Group, a public relations firm in Florida, can attest to that. He is currently overseeing the public relations for a Kickstarter campaign and is using NewMediaWire for press release distribution as he has done in the past.
“The press release goes out on the wire and is distributed to journalists looking for innovations in the fitness and exercise category,” Madden says. He is promoting an innovative new fitness chair invented by a doctor and that teaches the muscles to stay in shape and keep the body fit. “So we put this chair right in front of journalists most likely to write about it.”
This type of public relations in turn could lead to more potential funders arriving on the doctor’s Kickstarter landing page and funding the project.
“It’s not hype,” Madden says. “It’s not advertising. It’s legitimate news. To make your crowdfunding campaign newsworthy is the most powerful thing you can do.”
While newswires are essential for receiving earned media attention, there are other ways to incorporate public relations into a successful crowdfunding campaign.
Why Crowdfunding Platforms Should Include PR Services for Customers
Running a crowdfunding campaign isn’t easy. By providing public relations tools and media lists for companies and entrepreneurs seeking funding on their websites, crowdfunding platforms can provide a one-stop PR shop while becoming more competitive. Currently, crowd funders must use third-party services, in most cases.
CircleUp offers discussion forums and conference calls to connect corporate CEOs with potential funders, but their focus is on accredited investors. This is comparable to NASDAQ’s PR Webcasts tool, a benefit to all parties involved in a transaction or observing it.
Krowdster provides a variety of analytics services as well as press release distribution for companies managing crowdfunding campaigns. They also provide media lists, similar to NASDAQ, and a campaign optimizer tool designed to increase the effectiveness of landing pages on several different crowdfunding platforms. Additionally, their Social Capital Gauge will estimate the potential funding a campaign is expected to raise based on social media followers, and its Crowd Builder service allows subscribers to identify people on various social media platforms who are active crowdfunding backers, an invaluable tool for promotional purposes.
Services like Krowdster and NewMediaWire are proving useful to companies and entrepreneurs seeking funds from the crowd and serve as additional evidence that crowdfunding platforms are destined to become more like stock exchanges. It’s not a matter of if, it’s a matter of when.