Preparing Company Communications & Messaging For Your Fundraise
Having a solid digital presence is not only important for business growth–it is critical when it comes to securing funding.
Newchip has assembled the following guide to help companies build their bands ahead of a capital raise.
You will find a full library of press release templates here which can be used to share a number of company milestones.
As discussed in previous sections, there are many different types of fundraising options. The most common type of offering is a Reg D capital raise, which is limited to accredited investors and select friends and family you have proven prior relationships with. These capital raises will not allow you to issue a press release or make other public offers over social media.
Other offering types allow you to share your investment with the public and take investment from nearly anyone, however these offerings require special filings. You should only publicly market and issue a press release if you are doing an offering which allows for general solicitation, such as a Reg CF, Reg A+, or a 506c offering.
We have created a press release template to make it easy to share your Reg CF offering. If you are planning on executing a different offering type which allows for general solicitation you can use this as a base.
It is important that you always have the funding platform hosting the offering and your attorney review any materials relating to your fundraise before publishing.
Best Practices for Marketing your Offering
In the following sections, we will share more information on preparing your company for your raise. While some of the tactics are different, there are a few best practices that you should use as a guide when preparing to raise capital, no matter what type of funding you are pursuing.
Honesty is the Only Policy. Honesty is not only the best policy; it is the only policy when raising capital, especially when executing a public capital raise. When you are raising capital, you are putting a spotlight on your business and leadership team. Everything you say and do will be examined.
It is critical not only from a brand and reputational standpoint but also from a legal standpoint that your communication be free from errors and omissions as well as puffery. Do not overstate potential in press releases or media interviews or give numbers off the cuff that may be inaccurate. When speaking with the media, assume you are “always on the record” and make sure you are giving honest, non-forward-looking information that can be backed up.
It is always better to be a little conservative, especially when you are going on record. When raising capital and communicating with investors, honesty and openness need to be the cornerstone of every corporate communications strategy.
Messaging that Speaks to the Desired Audience. Executive biographies and targeted company messaging are among the most important foundational elements to completing a successful financing event but are often the most overlooked. Investors—particularly sophisticated ones—typically place as much emphasis on the competency and experience of a company’s leadership team as they do on the product or service in which they’re investing.
Founders’ biographies should not just rehash their resumes but rather position them as knowledgeable industry experts with track records of success. When developing this key messaging, think about what an investor would be interested in from past performance and future potential standpoint. Company messaging should also be clear, polished, and free from errors, omissions, and forward-looking statements. All messaging should be reviewed by experienced legal counsel to ensure compliance.
Having a Story Told by You and Others. While the numbers matter, investors also look at non-financial data points before pulling the trigger. They go to your site, look through your social media accounts, and often do a lot of “googling” before they pull the trigger.
How your brand is perceived, how knowledgeable and capable your leadership team comes across, and many other non-financial factors will likely be weighed before they make a decision.
This story of overall strength is often based on what investors read, see, and hear about a company in aggregate. It is how they perceive a company after reading stories the CEO has been quoted in, listening to industry podcasts, reading press releases and seeing the overall digital footprint of the executives and firm.
Newchip has provided a library of releases to help you tell your story over time. These templates will help you build your profile ahead of important milestones, so your digital profile is ready to impress. Each news release that highlights past accomplishments, from new executive hires, to awards your company has won, to new major clients and partnerships, closed funding rounds, and other milestones, helps to paint a picture of who your company is and what you have accomplished.
Increasing Brand Awareness Through Thought Leadership. Simplicity and brand awareness are often key to capital-raising success. One of the reasons big brands like Airbnb have successful IPOs is because they made their brand easy to understand and were very visible prior to going public.
For companies that do not have the benefit of mass-market brand awareness or have largely remained quiet during the early and growth stages of development, making oneself known as a leader within an industry can greatly impact your capital raise.
Customer case studies, contributing articles that discuss current industry trends, nominations for awards and press releases sharing accomplishments can all boost a company’s image ahead of a capital raise. Company leadership can build up a more prominent profile within their field while laying a solid foundation of media coverage that ideally comes out before and during any financing event.
Additionally, companies can and should be applying for speaking engagements and awards that highlight the company, community involvement, and industry knowledge to enhance their overall profile in the market and community.
Pitching your Funding Announcement to the Media. A key mistake many companies make is assuming whatever they’re doing is interesting to everyone. The news of a launch, raise, or other company-related event is rarely relevant to top-tier media.
The reality is, just announcing that a company is ‘testing the waters’ or actively fundraising may or may not be particularly newsworthy; it depends on the news cycle, the brand recognition of the company (or lack thereof), and other factors that are outside anyone’s control.
However, what companies can do to increase the likelihood of attracting the media’s (and therefore the public’s) attention is to fit themselves within broader trends happening in the market, their industry or community.
What greater problem is the company solving? How is this product/service disruptive to the bigger players? Is your company fitting into a more significant trend in your community? Is there a human-interest piece you could tie into? These are the types of questions that could yield some interesting stories to tell both reporters and potential investors.
Just remember, what you pitch to a reporter and the final story are two very different items. Once you are in an interview with a reporter you can weave in your talking points, mentioning key items you want to highlight.
Understanding that Timing is Everything. Throughout the Newchip Accelerator you will be provided with a wealth of training and resources to build your company’s digital profile. The more time you can dedicate to amplifying your brand awareness through media outreach before an offering, the better. By communicating a company’s story through media in their target verticals, the company reaps the multi-faceted benefits of third-party validation as it attracts attention, establishes an image, and sustains visibility among customers and potential investors — supporting and enhancing the eventual offering.
While an effective communications program to prepare a company for an offering is hard work, it can do wonders to frame early perceptions about future performance on which investment decisions are based.