- Uploading a reliable financial forecast and valuation, since this increases the campaign’s chances to receive the desired funding by 37,3%.
- Reliable market statistics that increase the chances by 27%.
- Already received external funding (from government institutions like Almi, Vinnova, EU), which increases the likelihood of being successful by 23%.
One of the most astonishing findings was the effect of social media. If including a link to the campaign’s Facebook or LinkedIn page in the campaigns pitch on the crowdfunding platform, the success rate increased by more than 30%. (31,37% for Facebook and 32,58% for LinkedIn).
Furthermore, 10 likes on the company profile of any of those social media portals add additional 6% for the success (6% on LinkedIn and 5,6% on Facebook). Also, in case the project has been submitted from a capital city (Copenhagen, Helsinki, Oslo or Stockholm) the likelihood for it to succeed increases by 21%.
Is this what you had expected? One of the main surprises was that sharing the company’s activity on the campaign page on Twitter did not have an effect on the company’s success.
The team: Surprisingly, the report indicated a small paradox. The amount of employees within a team and the amount of these people having a masters degrees proved not to have any effect on the rate of success. On the contrary, if the entrepreneur has a relevant education or a professional career in consulting, the success rate of the campaign increased by 25%. Moreover, a relevant business education can influence the company’s success rate by 25%.
Lastly, for all of you entrepreneurs uploading a campaign we suggest that you describe your team members’ backgrounds and achievements closely. This is because investors tend to value this factor highly when making investment decisions.
It seems like the funders would like to know, if people that stand behind the company have been successful in whatever field they were operating in the past.
Summarizing: While seeking funding for an equity based campaign, prepare the financial documents such as Market Statistics and Company Valuation well. Tell the crowd about the successes that your company has achieved so far with external funding, your awards and about the outstanding performance of your team members. Upgrade your Linkedin and Facebook corporate profiles often. You might skip Twitter activities on your campaign page:).
You will find the full report by clicking – here
*What methodology did we use in the Report? The campaign outcome was modeled by means of logistic regression as a function of various explanatory continues and category variables. The dependent variable was binary and shows either a successful or unsuccessful outcome.