When you've decided upon the type of funding you'd like to use, you need to find a funding website or platform that supports it. This can appear daunting, because there's an ever-expanding number of funding platforms to choose between.
Your initial approach to a platform is then very important. We spoke to Alysia Wanczyk, Seedrs' marketing director, about what actually happens when an entrepreneur and a funding platform meet each other for the first time.
She explained, "Once a business completes their online investment campaign, it comes through to our review team. The team then goes through and initially rejects any campaigns that are patently unviable, incomplete or plain silly. Those that proceed are carefully reviewed to ensure that every statement they make is fair, clear, not-misleading and truthful."
Unlike eBay, where the process of adding sales posts or landing pages is highly automated, Seedrs' registration system is much more human.
Wanczyk continued: "This [checking process] often requires a bit of a back-andforth email and phone exchange between us and the entrepreneur, to ensure we receive supporting evidence for every statement. Once both parties are happy with the campaign, we set it live to potential investors to review – with the peace of mind that what they're reading is reliable.
From there, it is up to investors to look around, ask questions and decide for themselves if a business is worth investing in."
Pass or fail?
Funding campaigns usually last for around three months, Wanczyk told us. The question is, of course, what happens if you're successful? We asked Wanczyk whether the cheque arrives the next day. She explained: "Once a campaign has hit its funding target, we conduct a further due diligence process to ensure that all legal and structural matters are in order with the company. It is all very straightforward."
What this boils down to is essentials such as registering the company with Companies House, setting up a company bank account, and completing taxation documents. And if you're not so lucky? Wanczyk told us, "If a start-up doesn't reach their target [within three months], their campaign is taken down and each of the investors is given their investment back and notified.
Sometimes, a business is given feedback from investors and potential investors and they take down the campaign themselves to change it and re-submit it."
