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The following is a sponsored post.
There could still be several more months before crowdfunding for equity begins in earnest in the United States with regulatory rulemaking still in process. But CommunityLeader says it's important to start preparing for the crowd now.
CommunityLeader proposes that businesses interested in Crowdfunding must start thinking, learning and preparing right away. The company has been developing an integrated crowdfunding platform over the past six months, and in the process has developed a good understanding of what can and should not be done before the SEC and FINRA make their respective rules.
In a new white paper on the topic, CommunityLeader addresses the common misunderstanding that businesses must wait to start the process of preparing for crowdfunding. The publication reviews the six "knowns" that every business can use as the foundation for action, and also introduces the four immediate actions that should be taken right away.
To learn more, download it directly at http://www.communityleader.com/whitepapers.
For more perspective on crowdfunding for your business, you can watch the archived copy of a live event with CommunityLeader originally broadcast live here on Crowdsourcing.org.
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<b>Getting a head start on crowdfunding a business</b>
To get a head start on crowdfunding a business, an entrepreneur could work on 4 of the 7 steps of crowdfunding—now—before the SEC’s crowdfunding rules are issued around the end of 2012.
The 7 steps to crowdfunding a business are: 1) prepare your business plan, 2) assemble your due diligence package, 3) have your due diligence package reviewed either by a service or your crowdfunding portal/broker, 4) conduct <b>“pre-rules” advertising</b>, 5) have your portal/broker sell your securities, 6) receive the funds from your portal/broker when your target funding amount is reached, and 7) execute your business plan.
Before the SEC issues the rules, executing Steps 1, 2, and 3 are straightforward, but doing Step 4 (<b>pre-rules advertising</b>) would be up to the entrepreneur’s interpretation of Section 302 of the Crowdfund Act, which says:
"....an issuer who offers or sells securities shall....not advertise the terms of the offering, except for notices which direct investors to the funding portal or broker...."
Entrepreneurs may consider <b>pre-rules advertising</b> in order to prevent their offer from getting lost in the flood of crowdfunding advertisements that is sure to come when the crowdfunding rules are issued. A pre-rules ad will have much greater visibility than an ad published after the rules are issued. A pre-rules preview advertisement would plant the seed in the mind of an investor of an upcoming investment offer.
(Tom Allen is editor of <a href="http://crowdlist.info/">CrowdList.info</a>, a website that provides free classified ads to businesses seeking crowdfunding.)