By Simon Dixon, Bank To The Future

There is no doubt that crowdfunding has already had a huge impact with about £1.8 billion raised for projects and businesses so far.

But how do you know which form of crowdfunding will work for you.

We put it down to your pitch.

First lets make a distinction - CrowdFunding refers to the process of offering rewards to a crowd of donors a pitch you upload to BankToTheFuture.com. CrowdInvesting refers to the process of offering shares in your company to a crowd of investors through a pitch you upload to BankToTheFuture.com.

Now here is the key difference in your pitch...

Investors like to invest in things that are as far away from an idea as possible, so if you have an early stage idea / prototype, crowdfunding is normally a better option for you.

You do not need to speak ‘investor language’ as they will buy into the rewards you offer and your story if they are pitched and promoted well, but the more progress you have made up-front the more likely you are to win the trust and purse strings of the crowd.

Now, if you are further down the line, pitch as far away from an idea as possible, and you may raise more finance through CrowdInveting.

Investors want to see progress, they want to see that you are investment ready and you want to be able to justify your business valuation through lots of progress.

Daniel Priestly, author of ‘Become A Key Person of Influence’ summed this up nicely at a recent BankToTheFuture.com conference with entrepreneurs seeking CrowdInvestment finance.

In summary, the pitch of a CrowdFund will look very different to the pitch of a CrowdInvestment. Crowdfunds like new and fun ideas, crowdinvestors like progress, team, intellectual property and the language of an investment-ready pitch.

Bank To The Future's Simon Dixon is speaking at our forthcoming Raising Finance Event @ Google Campus.

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