INSTANT FUNDING WEEKLY EDITION #19
Karl Dakin
I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
FUNDRAISER FOR CANCER LEAGUE OF COLORADO
I rappeled 200 feet from the bridge at McGregor Square in Denver, Colorado as part of a donation campaign for the Cancer League of Colorado.
This event is part of my fundraising campaign to benefit the great work of the Cancer League of Colorado.
You may donate directly to my Over the Edge campaign through the Cancer League of Colorado at https://www.denverovertheedge.com/teams/dakin-capital/
Or, you may donate through the GoFundMe platform at https://gofund.me/028df78d
Everyone who donates a minimum of $50 will receive a one-year subscription to Dakin’s Edge: Charity Fundraising Kit. This online set of tools includes:
·?????? A digital book
o?? Advice
o?? Templates
o?? Examples
o?? CHAT GPT instructions
·?????? Access to a dedicated AI avatar to answer questions
This Kit is intended to enable the subscriber to design and implement a fundraising campaign for their favorite charity.
QUICK CALENDAR
TUESDAY, September 24, Successful Funding, 8 a.m. MDT, LinkedIn Live, YouTube
WEDNESDAY, September 25, Don Cohen show, 9 a.m. MDT, LinkedIn Live
THURSDAY, September 26, Community Revitalization, 10 a.m. MDT, LinkedIn Live, YouTube
FUNDING HAPPENINGS
The EPA announced a request for proposals for its 2024 Build to Scale Program. The goals of the program are (1) to enable high-growth technology entrepreneurship and foster inclusive access to proven entrepreneurship support models; and (2) to increase access to capital in communities where risk capital is in short supply by providing operational support for early-stage investment funds, networks, and training programs that focus on both traditional and hybrid equity-based financing. Closing October 28. Slide Deck
The CDFA is presenting a two-day workshop ?September 24 and 25th on Intro to Tax Credit Finance . The workshop will include topics of New Markets Tax Credit Program, Historic Preservation Tax Incentive Program, Low Income Housing Tax Credit Program, Innovative state tax credit programs, and Federal energy tax credit programs.
Instant NonProfit is offering a free workshop Secure Major Gifts & Transform Your Nonprofit on Wednesday, September 25th. Time: 3 pm ET / 2 pm CT / 1 pm MT / 12 pm PT They will present a system that moves people from “interested” to “invested.” Instant NonProfit provides support services to charitable organizations from formation, obtaining designation as a 501c3 charity to annual filings. I am a customer of Instant NonProfit and have found their services of value for the complexity and time of IRS compliance.
The CfPA hosted a webinar on Empowering Entrepreneurs: Navigating Regulated Investment Crowdfunding and Capital Raising . The Crowdfunding Professional Association (CfPA) and the SEC's Office of the Advocate for Small Business Capital Formation presented an in-depth session on the tools and resources available to startups and small businesses navigating the capital-raising journey. It provided insights into the complexities of raising capital, understanding regulatory requirements, and mastering other critical aspects of the financial markets.
The US Small Business Administration announced the upcoming?2024 SBIR/STTR Fall Innovation Conference ?to be held in Austin, Texas, from December 3 through December 5. The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs are the nation’s largest source of early-stage, high-risk research and development funding for small businesses. These programs provide more than $4 billion annually in competitive awards, enabling entrepreneurs to develop new technologies and ultimately facilitate the commercialization of innovation.
One of the challenges in raising funding is making investor candidates aware of you. One of many solutions to this challenge is to be a guest on someone else’s podcast or live-streamed show. Through this solution, a person can be introduced to everyone who commonly views the show of the host. You may actively dangle yourself as a guest candidate on your website, through your common communications and through matchmaking services. I use Podcast Guest which publishes multiple times a week lists of podcasters looking for guests. For a monthly fee, you can post your biography and receive these lists.
Jenny Kassan (one of the original champions of investment crowdfunding) with the Kassan Group announced Krishi Janani PBC is?crowdfunding impact investments?to?scale the Janani Regen Ecosystem?to enable farmers to transition to regenerative agroecology and?build climate resilience in their communities. Sept. 21, Saturday on Zoom | 12 - 12:45 pm EST. Register for the office hour at https://lu.ma/w15o6lam Why is this announcement important? Jenny is a lawyer representing Krishi Janani PBC. When was the last time you saw a lawyer cooperating with their client to promote an investment offering on behalf of their client? Would your attorney do that?
DreamSpring , a source of non-bank lending, provided a guide on confirming to The Corporate Transparency Act. Businesses must file beneficial ownership information reports with the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN). Existing Companies:?Businesses created or registered before January 1, 2024, must file by January 1, 2025. New Companies:?Businesses created or registered in 2024 must file within 90 calendar days of their creation or registration.
Sustainability should be the goal of every entrepreneur and organization. It represents an accomplishment that enables the entrepreneur and organization to stay in business. Too often, this goal is replaced by a make-the-money-and-run strategy. Achieving sustainability is not a concern of care, or it becomes someone else's responsibility. The Impact Entrepreneur will host a program this week on Transforming Markets for Sustainability . This interview with John Elkington is described as “the pivotal role of systemic change and innovative financial strategies in achieving environmental, social, and economic objectives.”
FUNDING POINTS
YELLOW BRICK FUNDING ROAD
As a member of the RCI Community Funds team, I am deep into ongoing development and refinement of a capital strategy. Funding at a community level presents a more complex challenge in terms of matching needs with investor candidates with offerings.
?Where a single organization will likely go through a series of capital raises over its lifetime, funding a community may require a capital raise for each stage in the design, formation and deployment of funding.
Staged funding represents a progression that mirrors any startup that needs funding to get organized, to get started, and to scale. Each stage of funding represents a maturation in the overall investment opportunity. The early stages require less money, but the higher risk will require higher rewards to incentivize investment. With the achievement of milestones, the probability of success increases while the likelihood of failure diminishes. As a result, the cost of funding is reduced while the size of funding increases. Without this progress, the total cost of later-stage money may be so high that the opportunity is not feasible.
?This pathway to funding is like the Yellow Brick Road in The Wizard of Oz, where Dorothy and her team must traverse the road and overcome threats to reach the Emerald City.
?Many entrepreneurs attempt to shortcut the business maturation process. When successful, they are written up in popular media. When unsuccessful, their businesses commonly fail. Only a tiny handful may adapt quickly enough to survive.
?Within the RCI Community Funds capital strategy, the funding challenge is elevated by the fact that at each stage of funding the recipient of the fund changes.
1.???? Stage 1 – Funding of RCI Community Funds
2.???? Stage 2 – Funding of Community Investment Fund
3.???? Stage 3 – Co-funding of each real estate and business investment of the Fund
4.???? Stage 4 – Matching or follow-on funding of local projects and programs?
Despite this complexity, it may be easier to fund a community than a single business because the number of people that will benefit from the funding is greater in number and diversity. However, this will only happen if there is progress along its path.
COMMUNITIES OFFER MORE REASONS TO INVEST
When a small business engages in the identification of investor candidates, it is inherently limited by what it can offer in exchange for an investment:
·?????? A share of profits
·?????? A share of revenues
·?????? Interest on the use of money
·?????? Products or services of the business
o?? Free
o?? Discounted
·?????? Transfer or use of assets
· Payment of taxes to local, state, and federal governments
·?????? Support of [fill in the blank]
Despite this impressive list of items that may be included in an investment offering, the list is limited due to the size of the business, its current assets, its reputation (brand), its network of contacts, and the capabilities of its team. As a result, the small business may not have what anyone wants, or it cannot offer anything in the size and scale that represents a sufficient benefit to justify an investment.
Two or more businesses that combine forces may be able to offer more than a single business.
Following this line of logic, multiple businesses should be able to offer more than a single business thereby improving the likelihood that an offer may be crafted that will match well with one or more investor candidates.
A community working together, comprised of the businesses within the community as well as the charitable and civic organizations and local governments, expands these possibilities to the point where obtaining funding at some level in some form should be inevitable.
Depicted here is a stakeholder mapping of possible beneficiaries of a community investment fund planned by RCI Community Funds.
As a hub for local investment, a good design will touch every resident in the community, individual, business, charitable or civic organization and government offices in a positive way that would create a motivation to support the establishment and operation of the fund.
The adage of ‘there’s strength in numbers’ may be applied in development of a capital strategy. If a business finds itself in a situation where it appears that it cannot offer anything that will attract investment, it may need to partner with one or more other businesses, organizations and/or government agencies to make an opportunity fundable.
An offering may be crafted that incorporates all of the collaboration participants or it may be focused on that business, organization or agency that appears to have the best probability of raising funding. Funding to one should benefit all.
Instead of needing a crowd to fund a single business, single businesses may work together to fund a crowd.
COGS
Small businesses are commonly described as standalone forces of nature.
Small businesses cannot survive or succeed without contributions and actions by many other people, businesses, organizations, and government programs. A business is not an island. It is not an oasis. It is not self-sufficient.
A business needs:
·?????? Customers to buy their products or services
·?????? Vendors and suppliers of materials, labor, information, and other assets that are converted into their products and services
·?????? Communications in the form of phones/systems, Internet/systems, and other means of exchanging information
·?????? A roof over its head (whether working from home or in an office) built by someone else
·?????? Power to all of its tools, equipment, HVAC, or other devices
·?????? Streets, power, communications, water, and sewer lines
·?????? Safety services
·?????? Funding
Consider a business whose entire building, facilities and operations have been wiped away by a hurricane, flood, or tornado. What are they missing that prevents them from doing business?
The failure to recognize this fact and to incorporate it into everything a business does leaves the business open to gaps in strategy, incomplete operations and often failure.
A business must not only plan for every action that is fully within its control, but it must also work to influence every action that is in the control of someone else.
In practice, most businesses are reactive. “I will deal with it when I have to.” They become like a balloon that must go wherever the wind blows.
A business should know everyone and everything that affects their existence. They should identify those that have the greatest impact. These controllers of their destiny should be further studied. How to they conduct their operations? May they be influenced to improve their impact on the business? Can they be replaced or substituted?
This exercise can be a bit disconcerting as it becomes obvious how little true control a business has of its environment. The purpose of business accelerators and incubators is to create an intentional bubble where business can grow in a better set of conditions and limit the negative impact of the real world.
In working with businesses that are considering crowdfunding of any kind – charitable, rewards or investment, the business must look outside of itself to understand how it impacts everyone around them in order to pitch everyone to support their campaign. This ‘community’ mindset treats the business as a cog in a larger machine. It is humbling to realize that the larger machine can function without the business as a cog.
CANCER
Cancer is a disease in which some of the body’s cells grow uncontrollably and spread to other parts of the body. National Cancer Institute
·?????? Estimated national expenditures for cancer care in the United States in 2020?were $208.9?billion.
Why is this important to small businesses and communities seeking funding?
1.???? As stated, cancer is an industry. With spending in the United States at $208.9 billion, there are a large number of opportunities for businesses within this market.
2.???? If cancer is not your business, there are hundreds of charities that have cancer as their focus. As an example, I support the Cancer League of Colorado and Camp Wapiyapi as a volunteer fundraiser.
3.???? With the projection that 40.5% of all men and women will be diagnosed with cancer at some point during their lifetimes unless you are a lucky solopreneur, the odds are that cancer will impact someone in your business.
Even if cancer is not the cause of disruption in your business, some other disease or an accident or other event will almost certainly impact your business. The level of disruption may be minor or it may cause a business failure.
In an offering document, it is expected and often regulatory mandate to list potential risks to the business. One of the common risks that is especially important to small businesses is the threat that one of the leaders of the small business becomes unable to perform.
Key Personnel. The COMPANY is currently dependent upon the services of its founders and present leadership. If any of these individuals are unable to act on behalf of the COMPANY, then the COMPANY will be negatively impacted and may be unable to continue operations.
Every small business should develop its own emergency plan to address the possibility that one of its key people (which in a small business may be everyone) cannot perform their duties. Small businesses can do their best to replace that person. Quite commonly, this will cost more money that may not be within the budget. An entrepreneur may say (I have heard it said) that if I die, it’s no longer my problem. This statement may be true if the small business has no investors, but a failure to provide for this challenge after taking investor money is a breach of the entrepreneur’s fiduciary duty to its investors.
领英推荐
WRONG HEADED THINKING
Lucas Marquardt joined me today on my Successful Funding show [see link below] to discuss entrepreneurs who get fixed on action and refuse to listen to anyone who suggests an alternative path.
We talked about whether it was possible to change a person’s mind. Several possibilities were discussed:
·??????? Asking about how the entrepreneur came to their plan of action
·??????? Asking the entrepreneur whether they considered other options
·??????? Asking the entrepreneur about their goals and how the plan of action may contribute to their achievement
This conversation must be based on trust. Advice will rarely be taken if the person offering the advice is suspected of advancing their agenda.
A reality check may reveal that the entrepreneur is ‘uncoachable.’ This presents multiple problems. The problems will be greatest if the entrepreneur will not hold themselves accountable for the results if the plan of action fails. Lack of accountability will result in someone else being blamed. This possibility leads to the best practice for any partner, director, advisor, mentor, or consultant to just walk away. No one needs a failure, and no one needs to be blamed for someone else’s decision.
BILLBOARDS
An entrepreneur may craft the best pitch, but this achievement must be accompanied by placement of information about the investment opportunity where it will be seen by those investor candidates who are most likely to invest.
Keep in mind that in first contact with an investor candidate, the goal is to get their attention and trigger a response for more information. First contact may be accomplished by placing information in a location (a billboard).
Possible locations for a billboard include:
·??????? Social media post
·??????? Newsletter
·??????? Website
·??????? Pitch competition
·??????? Angel club presentation
·??????? News story
·??????? Feature article in a magazine
·??????? Interview (podcast, television, radio)
·??????? Book
·??????? Video
·??????? Other
·??????? Sponsorship of a charity
The best place for a billboard is where an investor candidate regularly receives and reviews information. If the identity of the investor candidate is known, it may be possible to identify some of these communication channels:
· Communications from friends
·??????? Communications of professional, civic, industry, charity, or other communities
·??????? Events of professional, industry, business, charity or other communities
·??????? Memberships in organizations
·??????? Publications
Very few investor candidates are members of an angel club or other investment group. There are greater numbers in volunteers and mentors in small business advisory groups.
The initial pitch is to provide awareness. It is not to close an investment. That will take time to build credibility, educate the investor candidate on the opportunity and compare favorably with other investor opportunities. The pitch should ‘speak’ to the investor candidate about what they care about in words that they can understand.
The major distinction is whether the investor candidate is primarily looking to invest or is opportunistic in seeking to advance their own business strategy. The billboards will have different content in different places.
SILENT AUCTION BUSINESS MODEL
I attended a fundraising event for a charity last night. The common design included raising funds through a silent auction, a live auction and a paddle raise.
A silent auction commonly will offer different items that have been donated by good hearted people who want to help the charity and businesses seeing the charity event as a way to promote their brand.
Depending upon the charity and its event attendees, items in the silent auction may range from a discount on a night out at a restaurant to a trip around the world. From home baked goods to lavish items for the high net worth individual, there is tremendous variety in what may be offered for sale. It is important to note that the items must match the attendees' buying preferences and pocketbooks. This is part of the market analysis completed at the front end of planning the event.
From a high-level perspective, it would seem that any item donated to a charity for sale through a silent auction is a good thing. However, let’s look behind the curtain and do an analysis of the business model for a single silent auction item.
Most of the silent auction items are solicited. This means that time and money go into contacting prospective donors and requesting that they make a donation. This is a fundraising campaign all by itself. It is necessary to identify prospective donors, put together promotional materials, contact the prospect, and make a pitch. If successful, an item is received for inclusion in the silent auction. If unsuccessful, time and money are lost. Contacting prospective donors who will never make a donation to this particular charity is a waste of resources.
Once a commitment of a donation has been made, it will commonly be necessary to transport the item to a staging area prior to the event. This may be a simple, free, email of a digital certificate or it may require special transportation with shipping fees.
After the item is received, a presentation of the item (the pitch) must be prepared. This commonly includes a placard that describes the item, the donor, and the retail value with a minimum bid price. In some cases, a photo image is included because a gift card in an envelope does not get the job done.
The silent auction item is commonly placed in an online auction catalog to further promote the event and enable people who cannot attend the event to bid.
An online auction catalog may be simply done; however, it is a common practice to license software to manage sales. It is also common to hire a combination of salesclerks with the software to facilitate matching attendees of the event, online donor prospects, and purchased items. The software enables people to use their smartphones to make bids, track bidding, and make payments. This improves accuracy, speeds up the payment process, and prevents donors from standing in long lines at the end of the event waiting to pay for what they purchased.
On the day of the event, the items must be transported to the event site and placed on display. The display may be minimal to the maximum with decorations, displays, posters, video, and photo presentations on flat-screen devices, to rented cosplay actors in costumes.
During the event, bidding will occur within a fixed time frame. Support staff is needed to answer questions and help people use the bidding software.
On closing the event, payment for the purchased items if processed. This may be cash, check, or credit card.
Upon purchase of the item, the proud donor may pick up the item and take it home. Commonly, assistance is needed to move many of the items from the event site to the transportation of the donor.
People purchases some items online or by people who leave before the event ends. This creates a need to arrange transport of the item to the donor. This may include email or a call to schedule plus hand delivery to the person at distances that may vary greatly.
Some items do not sell. These require special handling to hunt a donor that matches with the item or the item may have to be returned to the person who contributed it.
Many charities sell items on consignment. This arrangement calls for a vendor to offer an item for sale through the charity for a price. These items commonly include sports memorabilia and travel. If the item does not sell, the item is returned to the merchant. If it does sell, the cost of the item is an additional expense to the charity.
As an additional note, a donor who buys an item in a silent auction has to recognize the value of the item purchased and the amount of their charitable donation, which is limited to any price paid beyond that value.
Assessing the business model for an item in a silent auction is the price paid by a donor in the silent auction (which is commonly less than the retail price) less the following expenses:
·??????? Time of charity staff
·??????? Time of volunteers
·??????? Transportation
·??????? Display
·??????? Promotion
·??????? Software licenses
·??????? Contractors
·??????? Consignments
Some of these expenses are direct and limited to a specific silent auction item, some are spread over all of the auction items, and some are shared with the rest of the fundraising event.
Anyone who is planning a fundraising event with a silent auction should price their expenses and determine a minimum value of a donated item that will yield a positive dollar amount upon sale.
SUCCESSFUL FUNDING
LAST TUESDAY, the guest on my Successful Funding show was Lucas Marquardt, MBA with Precision Financials. Lucas provides services as a part-time CFO for a variety of businesses. We discussed the problem of entrepreneurs who get set in their thinking on raising funding that is pointing them to the wrong strategy. We explored how advisors may overcome wrongheaded thinking or reach the point where it is necessary to walk away.
You may see a recording of this show at:
You may view recordings of all past Successful Funding shows at my LinkedIn profile under Events:
RCI COMMUNITY FUNDS
As a member of this new company, I am working with a team of professionals to craft a new funding mechanism for revitalizing underserved communities.
THIS MORNING, RCI Community Funds, Benefit LLC presented the Community Revitalization show on LinkedIn Live, YouTube and Facebook. Our featured guest was Peter Rostovsky with RaiseWay where we will discuss the nuts and bolts of investment crowdfunding for local communities, community capital and building local wealth.
You may see a recording of this show at:
DON COHEN SHOW
LAST MONDAY, I was a guest of Don Cohen show along with Kon Apostolopoulos with Fresh Biz Solutions. The show is broadcast on LinkedIn Live, Facebook and YouTube at 9 am MDT / 11 Eastern time.
You may see a recording of the show. Here is the link:
Don is my mentor and guru on using LinkedIn as a social media platform to build my brand and build my community of individuals and organizations who work like me to help small businesses and communities raise funding.
SUBSCRIBE
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Karl Dakin, the Capital Coach
Dakin Capital LLC
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2 个月Thats Amazing program thanks for sharing this Karl Dakin best wishes to you all their chep it up you are doing good work more love and respect to you all their ?????????????????????????????????????????????????
I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
2 个月What is your direct path to funding?