How to Restart a Crowdfund Investing Project
If you get the opportunity to refocus on your startup or your plans for growing your business, you must be able to communicate with your former and new potential crowdfund investors why you’re worth the investment risk. Raising money in a new campaign will be a challenge — very likely harder than the first time around.
If you returned every dime to your investors, complied with SEC regulations, and communicated openly with your investors when you interrupted your project the first time around — you should proceed with your head held high. But you aren’t starting from square one here; you’re starting from square minus one. You have to overcome two types of investor confusion:
The confusion of former investors: Even if you communicated completely during your cancelation, some people won’t recall exactly what happened. As important as your business is to you, it’s one of many important things in your former investors’ lives, and they can’t be expected to remember the details of the cancelation.
You have to reengage with them to explain again the who, what, when, where, and why of your idea. To do so,
Start with your family and closest friends. These are the people who are with you in good times and in bad. You need them to invest in your new campaign to begin the process of generating traction. (Without the buy-in of your core network, your new campaign likely won’t stand a chance.)
Organize the remaining list of your former investors into groups. You may have groups such as work colleagues, friends, extended family, friends of friends, and people you don’t know.
Within each group, determine who are the key influencers and/or leaders. These are the people you want to contact directly (by phone or e-mail, perhaps) to ask them to visit your new funding portal campaign page. If you can convince them to invest in you again and to publicly support you, they may pull additional investors back into your fold.
The confusion of potential investors who knew about the previous campaign but didn’t invest: This group may be the most challenging because they weren’t necessarily privy to your communication when you canceled the first project. As a result, they may not realize that you canceled at all, or they may have heard about the cancelation but not known that you refunded all the money to your initial investors.
To get them to consider investing, you have to fully explain what happened and why you’re back. You may consider including a section in the written and video pitch on your funding portal campaign page that explains what occurred.
The cancelation doesn’t need to be your lead, but somewhere during the pitch you should make it clear that you succeeded with the previous campaign, something major happened in your life, you returned all the money to investors, and you complied fully with SEC regulations. You can point investors to a link that takes them to a section of the crowdfunding portal where you provide more details if you want.
Of course, you also want to take the opportunity to improve on your first campaign if possible by making your pitch even stronger this second time around. Consider what worked and what didn’t work in the prior campaign, and try to learn from it.
As you map out where your investments came from previously, ask yourself some questions:
Did certain sections of your social network invest more than others? For example, did you have greater success with your professional contacts on LinkedIn or your social contacts on Facebook?
Can you identify common traits among people who chose not to invest? In general, were they people who lacked a professional connection with your industry? Or did geography play a role (meaning that people closest in location to you invested more often than those at a distance)?
This study doesn’t need to be scientific, but if you can determine any possible investment influencer based on your prior campaign experience, you may be able to tweak your pitch to overcome it. (Or you may decide that you’re better off focusing your time and energy on people who share traits with those who invested the first time around.)
Of course, your social networks likely have expanded since your previous campaign began, so you’ll probably be reaching out to people who had no knowledge of the prior campaign at all. They’ll have the same access to information about your previous campaign that everyone else does, so just be prepared to answer questions about what happened.