£26k/3months of crowdfunding management??

£26k/3months of crowdfunding management??

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ReaderScars

Original Poster:

6,087 posts

178 months

Thursday 2nd March 2017
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Having read a little of what it actually takes to successfully run a crowdfunding campaign, I looked into crowdfunding management outfits and received a rather basic quote from a UK outfit.

£8k per month over three months +10% 'operating costs' - approx £310 per day.

I would be interested in hearing thoughts, opinions - anyone involved in crowdfunding campaign management perhaps?

johnfm

13,668 posts

252 months

Friday 3rd March 2017
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Screw that. My corp finance adviser is only charging me £25k brokerage fee for intro to a funder providing a £5m investment.

But it does depend a lot on what you're trying to fund.

ReaderScars

Original Poster:

6,087 posts

178 months

Friday 3rd March 2017
quotequote all
Yes, that confirms my suspicions as I'm definitely *not* looking to fund anything like a £5m project! 'kin 'ell.

After getting back to them yesterday about how their fee would pay for the first set of tooling and manufacturing for launch, they even suggested I keep quiet when building their figure in to the required campaign funding level. That's how embarrassed they appear to be about their own fee!

DonkeyApple

56,417 posts

171 months

Friday 3rd March 2017
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I do t think that was embarrassment, it was just them explaining how it can be so high as you're obviously just going to spank it out of the punters.

It's the same model used in the traditional penny share market which is really all this stuff is just veneered with a lot of Silicon Valley hocus pocus, or what is more traditionally referred to as turd polish.

ReaderScars

Original Poster:

6,087 posts

178 months

Friday 3rd March 2017
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DonkeyApple said:
turd polish.
Yep, you've made your dislike of all things crowdfundy clear. As in, every time the topic comes up.

I don't think you could incorporate £26k in addition to the required start up capital without it being flagged as a suspiciously high funding target. Personally.

NickCQ

5,392 posts

98 months

Friday 3rd March 2017
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ReaderScars said:
Yep, you've made your dislike of all things crowdfundy clear. As in, every time the topic comes up.

I don't think you could incorporate £26k in addition to the required start up capital without it being flagged as a suspiciously high funding target. Personally.
What's the total amount you are trying to raise? As a general principle I wouldn't accept a fee structure like the one you described that has no contingent amount based on whether they are successful or not!

DonkeyApple

56,417 posts

171 months

Friday 3rd March 2017
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ReaderScars said:
DonkeyApple said:
turd polish.
Yep, you've made your dislike of all things crowdfundy clear. As in, every time the topic comes up.

I don't think you could incorporate £26k in addition to the required start up capital without it being flagged as a suspiciously high funding target. Personally.
Not every time. Just when there seems to be a manifest misunderstanding as to what the product actually is.

For example, why would you even consider fees such as these is the amount you'll be raising isn't in the hundreds of thousands? What is so terrible about your business that you have to even consider this model for the small amount that you are looking to raise?

ReaderScars

Original Poster:

6,087 posts

178 months

Friday 3rd March 2017
quotequote all
NickCQ said:
What's the total amount you are trying to raise? As a general principle I wouldn't accept a fee structure like the one you described that has no contingent amount based on whether they are successful or not!
I completely agree about the fee structure - I was surprised when I was told the first invoice would be issued on signing of contracts.

Total amount is, perhaps £25-£30k - but it could well be less if I can get tooling made in the hundreds rather than thousands. The components aren't complex.


johnfm

13,668 posts

252 months

Saturday 4th March 2017
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At that level, SEIS.