Qualities to have of future Issuers on Equity Crowdfunding Platforms
Malaysian companies, be it the small to medium enterprises (SMEs) to the public listed corporations, would have some form digitized their business activities through an online presence to using social media platforms in this current marketplace.
However, the youthful, energetic and mostly ambitious team members in a start-ups or SMEs would all require funding to execute their next growth stage or expansion plans for a potentially successful business model. Sticking to the tune of the digital space, should these companies (i.e. future issuers) even consider the use of equity crowdfunding (“ECF”) platforms? After all, ECF platforms have been considered as an alternative access to capital to the traditional bank loan applications, grants or investments from family and friends.
Therefore, these are just a few criteria that future issuers in Malaysia should possess in terms of their business model and aspirational goals as a consideration before signing up on an ECF platform:
Regional or even global expansion plans
Staying local (i.e. Malaysian market) may be a short-term goal but having a business model that is scalable to at least regionally toward Asian countries should always be in the works. Investors from the crowd are always looking for that next gem that would be able to appeal to a wider population base and willing to buy into your company’s product or services but not just limited to the 30 million folks locally.
These investors from around the world may also buy into your companies’ future growth if it has a global appeal and someday in the near future be offered officially in their respective countries.
Social media compatible
Recommendation of a great product or service through the good old adage of “word of mouth” may still whole true but getting shared on various social media platforms would get you closer to instant virality. With the crowd behind you, a new set of audience will get to know about your company and business offerings in a short span of time with the least amount of effort.
Of course, there is no denying the value of a well-crafted advertising and promotional campaign, but the positive impact from a fund-raising exercise on an ECF platform is an additional benefit to the issuer as opposed to being a paid service fee.
Nonetheless, marketing your company and its business model must be impactful and kept simple to the everyday person for it to be understood by everyone. Short and sweet goes a long way in getting people’s attention than lengthy taglines or descriptions.
Start-ups would have their business model hinged on using web-based and mobile applications to achieve the scalability that it so craves from day one of conceptualization. Not all companies begin from this route as some may come from a brick-and-mortar setup. It’s never too late for these companies as long as they are willing to embrace the digital way of doing business.
In its simplest form, potential customers and future investors must be able to access information about the company, product or services through a click on their mobile devices, laptops, notebooks or even desktops. After all, that’s how people find out about things through the web, wouldn’t you agree?