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Investor Motivation

Vested Interests

Investment Crowdfunding is special because you have a chance to harness the power of a crowd to support your small business and reward them financially for their participation. Your most dedicated supporters may be people who are already financially tied to the success of your business. Look for ways to position your raise as a “double benefit” to your investors.  

For example, if you are seeking funds to expand a restaurant, ask your meat or wine suppliers if they would consider investing. A new patio that doubles your capacity could mean that you buy twice as much from them next year. The “double benefit” is the vendor could sell more product to you and become an investor receiving dividends.


PERKS give investors another reason to act. Spending a little money to motivate investors can make a big impact, if the perks are desirable. To create thoughtful perks, you will need to speak to potential investors and ask them what interests them.  Think of this as a form of market validation, and a way to reachout and warm up a few prospects by getting their advice. Survey 2-3 of your Investor Contacts and at least 7-10 of your Network Contacts and make notes. Perform a quick ROI (return on investment) analysis for your budget. Remember that it is your Crowd’s opinion of a good perk that matters.


For each of your contact lists, survey 2-3 Investor Contacts and 7-10 Network Contacts. Ask them the items below.

A phone survey instead of sending out emails with questions lets you ask follow-up questions and better ‘hear’ the emotional connections to specific perks.

Perks Survey Questions

What type of investments do you currently make?

Listen for company names, industry, size, and any personal connection

Note the investor motivation: Financial, Social, Identity, Product etc.
(More info below)

Have you ever backed a Kickstarter, IndieGoGo, or GoFundMe campaign?


Were there any good perks? 

Notice any bad perks/items to avoid?

Have you bid on any silent auctions at fundraiser events?

What did you find appealing?

What items were popular?

Can you think of any reason why investors like you would not invest in small businesses?

What perks would be so good that it’s an “automatic yes”?


Survey your contacts efficiently with the

supplemental sheet titled, “Perks Survey.”  Use it to take notes while you listen.

Unprompted check-in:

At the end of the
conversation, get their
reaction to any perks
suggested on your
previous calls.

Reasons to Invest

Investors may have many different motivations for supporting a campaign. Humans are not one-hundred percent rational with their money. It’s worth examining all motivations. You must meet investors’ needs in order for them to act. The broad categories are Financial, Social, Identity, and Commerce. These reasons may overlap and/or have varying levels of intensity:

Financial (Money):

Gain: Return on Investment and financial gain is an obvious motivation. To satisfy this urge you will need obvious ROI shown in your Financials, plus demonstrate you are trustworthy, credible, and experienced.

Avoiding Loss: The fear of missing out (FOMO) on a tempting long-shot is a common financial motivation.  No one wants to miss-out on the next Apple, Amazon, Facebook, Google, or Microsoft. This is about wetting the appetite: passionately communicate your vision and the size of the opportunity.

Spreading Risk: Financially motivated investors may be looking to diversify or balance their holdings. Keep an eye out for people likely to have their eggs in one basket. For example, a life-long employee of Cisco might specifically target Non-Tech because so much of their stock market holdings are from employee compensation. In this case, highlight how investments in small companies or in different industries may compliment a lopsided portfolio.

Social (Relationships):

Friendship: Even without an attractive ROI some people will support you because they want to demonstrate personal affection and support in a tangible way. Here Communicate your authentic need and gratitude, so clearly demonstrate recognition and appreciation.

Team Colors: The second ring of social-support is from acquaintances that share some type of group in common. The supporter may not know enough about you to become a die-hard supporter but may still throw-in a token amount your way based on nothing more than team colors. To reinforce their sense of tribal belonging, make sure to establish yourself as a member and how your project/business will benefit their heart song niche or
hyper-local community.

Fanboy/girl: Another way to leverage social support is to borrow crowd allegiance to a specific influencer. The potential investor may be actively seeking to perform acts of solidarity with the esteemed person. First you need to identify the right person to spread word-of-mouth support to their crowd, then you need to understand the influencer’s preferred payment: cash from your marketing budget, a mutual admiration partnership, or with quotable data that demonstrate the power/extent of their influence etc. 

Tit-for-Tat: An overlooked generator of support is a sense of fairness and/or guilt. Be careful not to abuse the goodwill of your circles, however if you are a person who always “gives first” … Now is the time to call in the chips. Do you always buy cookies from the Scout-parent in your office? Get called on
moving day? Pet-sit regularly since your friend got the new job? Bring soup to the sick? These contacts may be eager to “pay back” those favors to clear off their mental “balance sheet” even if they aren’t 100% convinced your business is a sound financial decision.

Kinship: Similarly, do not overlook family obligation as a notable source of support.  You may find that Parents, Grandparents, Adult Children, Siblings, Cousins, Aunts, Uncles, “Steps” and In-Laws are open to investing in your business to revitalize, stabilize, or advance the family as-a-whole. With an honest & earnest approach, your family can become your best advocates
and investors!

Formality: Investment crowdfunding campaign offers distance and the added credibility of a lawfully issued financial security. The Private Placement Memorandum makes the offering and risks clear. This reduces the emotional risk of misunderstandings compared to a casual pooling of funds around a family member’s kitchen table. Review your family history for past conflicts that could have been mitigated with this type of assurance.

Rebalance commitments: This funding format allows ANY family member to buy into the business, not only the rich ones. This may help motivate and retain employees without having to implement a complicated stock plan. Also, less-affluent family members can show commitment and feel they have earned a voice. Similarly, affluent family members can be relieved of the pressure of being the single source of runway. Consider your family dynamic to determine if this is a selling point for your campaign.

Resilience: A strategic family could decide to support each-other over many separate campaigns. For example: a group of cousins might plan to buy three franchise locations over five years. If all things are equal, this fractional-ownership may foster more financial resilience for the overall family unit, vs. each cousin owning 100% of their own location. Assess your family culture to determine if this benefit matches your family’s cooperation level.


Identity (Sense of Self)

It’s Cool: Some people may invest for personal factors that have nothing to do with your financials or their relationship to you… some supporters will fund your business because it nurtures a facet of their identity and/or endorses their sense of self. The best campaign types to leverage this type of marketing are projects with a cool-factor, a heart-warming purpose, or that touch into controversy. 

Affiliations with these strong emotions can provoke a knee-jerk desire to buy-in. Handle these strong flavors carefully and you may gain investors who want to make a statement by flying your flag.

Status: This may be obvious, but individuals will spend money to buy displays of wealth and/or status. Investments can be an obvious source of pride since the ability to invest has been traditionally a dividing line between classes.  Being able to claim “I invested in several startups in town” (without specifying the amount) may be enough of a motivation for some people. For some, being perceived as an investor can be as socially significant as driving a luxury car.

Entertainment: Still other potential investors may buy into deals as a form of entertainment. They may feel entitled to burn a certain amount of “play money” because a partner spends frivolously, or they may enjoy the “moral high ground” of betting their money on something that has any chance to turn a profit. To attract this type of investor, ensure that your marketing materials give them enough to daydream about, and offer perks with fun events that are worth talking about.

Association: Some investors may be investing to buy a golden-ticket to be seen with the wizard. They will pay to associate with notable co-founders, advisors, or other big-name investors. In this case, they may see an investment like a membership into an exclusive country club. (Note: If you have famous investors, obtain their permission before you broadcast the affiliation, they may have contractual limitations or professional scheduling to consider.) To determine if your investors fit this category research their public personas. Look for obvious displays of “power accessories” or “lifestyle” flare. For example: exotic travel Instagram, elite gym membership, prominent luxury brands etc. To attract this target focus on ways to make them feel special with VIP experiences or exclusive luxury perks.


Same Foxhole: These investors have serious overlap between your success and their success. For example your suppliers are natural allies. This symbiotic relationship can be found in many industries so keep an open mind to see how this can apply to you because this is the most exciting type of investor for Investment Crowdfunding! Here you can create a triple benefit to working together:

p68 Triple Benefit illustration

  • First overlap: If the restaurant doubles capacity, your suppliers could double their sales to you. 
  • Second overlap: They become investors in a successful business with a solid ROI. 
  • Third overlap: they obtain a valuable perk such as pre-paid catering at a discount. 

Product: Some people are desperate for a product to exist and will eagerly “share the load” just for the ability to purchase a
product/solution. They may have a legitimate business need, just not the ability to do the project themselves: this type could include esoteric industrial or safety equipment, budget-friendly aftermarket services, a retail store in a remote location etc. Here the key factors are how quickly the product/ service becomes available, plus stability afterwards. Be explicit with the go-live dates, minimum guaranteed quantities, and/or concrete plans to continue business for years. Highlight any business-to-business special prices, perks, pre-sales, as well as clear examples of the math for their possible breakeven date. 

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