British Journal of Photography’s Marc Hartog on equity crowdfunding

British Journal of Photography CEO Marc Hartog recently raised £400,000 on Crowdcube. Here’s his advice on equity crowdfunding: 

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Prepare to be open: “When I started the business, I didn’t show our full business plan – just a three-page extract and only then if you signed an NDA. If you’d said at that time that I would be putting our plan on the internet I’d have said you’re mad. But you have to let that go. You have to put your strategy, thoughts, and your forecasts for the next five years in the public domain. It seems very counterintuitive but that’s what you have to do.”

Don’t go [equity] crowdfunding without a crowd: “If you’ve got a large following, people will invest because they love the brand and are loyal to it. When people buy shares in a football club it’s not because it’s going to make them a huge profit.”

Momentum is key: “It’s absolutely crucial to one of these campaigns. We had a prelaunch page on our website which gave people most of the information without them having to register on Crowdcube. There was a form to register your interest – that was invaluable because it gave us a host of people who we could email.”

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Pre-market: “We had a 48-hour period where the pitch was live to people who had the link but not to the public. That was really important as it creates momentum and a sense of urgency. We went live on the Tuesday morning, by Wednesday lunchtime we had hit our minimum target before it went live to the public. The first thing the Crowdcube community saw was that we were overfunding – crowds attract crowds.”

Lower your target: “Remember, if you don’t reach your target, you get nothing. Always set your minimum target at the lowest level you can in order to achieve what you want to do. The crowd only really engage once you are close to the target or over it. We wanted a quarter of a million: it would have been heartwrenching if we had set it at 250, got 220 and ended up with nothing, because £220,000 would have been absolutely fine.”

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