Why You Should Raise with Equity Crowdfunding (ECF)

There are four main reasons why businesses go for ECF fundraising:

Brand positioning and validation: An ECF fundraising campaign is basically a marketing campaign. In that sense, it is a perfect test bed for most businesses to validate their products or services. Galvanising support from those who have used your services or bought your product would not only provide market validation. But, it also boosts your brand recognition and position in the market.
Business valuation: Business valuation plays an important role in a fundraising campaign. Coming up with the right valuation is crucial, especially for private businesses. Fundraising is about supply and demand. Therefore, ECF provides an avenue where founders can properly determine the fair value of their businesses. In addition, it also allows investors to also value the businesses as well. All in all, it helps set the valuation benchmark for private businesses in the private market.
Ownership and management control: Raising capital via ECF fundraising would mean that founders need to dilute a certain percentage of shareholding. However, they are usually miniscule and would not directly affect the business management rights. Founders still retain majority control over their businesses and secure funds to grow their business.
Feasible alternative financing: Private businesses often face hurdles in obtaining financing. ECF becomes the feasible option because it allows founders and businesses to showcase their products and services to a larger number of potential investors in comparison to other traditional financing methods.

How to decide between Equity Crowdfunding (ECF) and Venture Capital (VC)?

Deciding between Equity Crowdfunding (ECF) and Venture Capital (VC) can be a challenging decision for many entrepreneurs seeking funding for their businesses. While both options offer benefits and drawbacks, choosing the best option for your business can be a matter of understanding your needs and goals.

Here are some key factors to consider when deciding between ECF and VC:

Key Factors	Equity Crowdfunding (ECF)	Venture Capital (VC)
Control	Business retains control over the direction and management of the company	Investors often have a say in the company's management and strategy
Funding Goals	Great option for smaller businesses seeking to raise a modest amount of funds	Offer larger sums for high-growth startups
Due Diligence	Process is more transparent where investors can access and review a company's financials and business plan before investing	Involves a more in-depth due diligence process, which can be time-consuming and resource-intensive
Timeframe	Shorter timeframe for raising funds, with campaigns typically lasting between 30-90 days	Take several months to close and often requires a longer-term commitment from both the business and the investor

How it works

Requirements