Checklist for Businesses & Startups

This checklist is for businesses / startups planning to raise via Reg CF, Reg A+, or Reg D 506(c) exemption on a funding portal, through a broker dealer, or direct through an attorney. Not legal or financial advice, just a starting point to help you out.

December 7th, 2023 by Russ Urban

Step #1:

✅ An Unbiased Look at Your Business: Evaluate the attractiveness of your business or startup idea from an investor perspective.

✅ What is your business or startups most attractive selling point?

✅ Future potential of your product / service? Does it solve a problem? If so, this should be highlighted.

✅ Is your industry or niche trending right now? If so, identify and highlight why and how your product / service fits into this hot industry or niche.

✅ If your industry is established, how is your product / service disrupting this industry? or is it fixing a well known problem that is caused by an established industry?

✅ What sort of traction are you seeing right now? Customers, brand recognition, media, partnerships, community traction etc.

✅ Do you expect your business to do well in front of investors? What are its plans for expansion (growth) and innovation (industry disruption)?

✅ Ask yourself if you should consider M&A to make your business more attractive.

✅ Do you need to consider a new direction or pivot?

✅ Who are your competitors? What is your plan to outcompete them? Is it a David vs. Goliath story that investors can rally around?

✅ Does your business have the cash on hand or access to capital for an ad budget?

✅ Web Presence and Infrastructure: Evaluate your web presence including your website, hosting infrastructure, and social media.

✅ Is your website modern, attractive, responsive with messaging ready for the limelight of an equity crowdfunding campaign?

✅ If a direct offering, do you have purpose built landing pages and calls to action ready?

✅ Is the social media of your business / startup including team members ready?

✅ Corporate Structure: Evaluate the status of your Corporation or LLC.

✅ Must be a Corporation or LLC to run an equity crowdfunding campaign.

✅ Are your corporate books in line and up to date with the necessary meeting(s) held to run an equity crowdfunding campaign?

✅ Is your cap table accomodative and conducive to an equity crowdfunding offering?

✅ Are you satisfied with your management team? Need additions to it?

✅ Highlight past successes of members of your management team.

✅ Exit Potential for Investors: What are potential scenarios you are aiming for in terms of a goal of an exit down the road? Providing investors an opportunity to exit is becoming increasingly important in equity crowdfunding. NASDAQ Listing? ATS Listing? Portal-Branded Secondary Market? Other Secondary Market Listing? Buyout / Acquisition by Another Company? Merger into Another Company? Remember, however, that you are not allowed to promise or guarantee an exit.

✅ Step #1 Services:

✅ Don't go it alone. Reach out to Russ Urban for help with Step #1.

Step #2:

✅ Choose the Right Platform / Intermediary / Path for Your Equity Crowdfunding Needs.

Two Types of Equity Crowdfunding Intermediaries:

1) Funding Portal, or 2) Broker Dealer.

Additionally, for Reg A+ offerings, consider another option: Direct Offering with Legal Support (an Attorney).

✅ Choose the Right Exemption: Three Popular Exemptions - 1) Reg CF (most popular), 2) Reg A+, 3) Reg D 506(c).

✅ Choose the Right Security Type: Four Broad Categories - 1) Equity, 2) Future Equity, 3) Debt, 4) Hybrid.

✅ SEC Filing Preparation: Connect with an attorney.

✅ Prepare a Form C (Reg CF), Form 1-A (Reg A+), or Form D (Reg D 506(c)).

✅ Decide on important parts of a filing such as "Use of Proceeds" and much more.

✅ Decide on key parts such as: 1) security type, 2) valuation, 3) minimum investment, 4) price per share / unit, 5) start and end date (offering period), 6) amount being raised, 7) type of offering (round).

✅ The Terms of a Reg CF offering by an Issuer that filed a Form C include: 1) the amount of securities offered; 2) the nature of the securities; 3) the price of the securities; 4) the closing date of the offering period; 5) the planned use of proceeds; and 6) the issuer’s progress toward meeting its funding target.

✅ Support Network: Who is in your corner, by your side for your equity crowdfunding offering?

✅ Community: What is your current community within your business? and on your social media?

✅ You may or may not have a current community, but if you do, then it should be leveraged as these are your biggest fans and most likely investors.

✅ If you do not have a current community, then equity crowdfunding is a great way to build a community around your business.

✅ Strategy: Create micro and macro strategies for your company's specific needs and unique challenges.

✅ Game it out and exhaust all potential avenues when it comes to your company and an equity crowdfunding raise.

✅ Offering Page: Is it the best it can be?

✅ Make sure it is conversion optimized to convert potential investors to investors.

✅ Compare the offering page to others in your industry (your competition) and offering pages in general.

✅ Compliance: Have a compliance list ready (prepared by your attorney) that is specific to your business and its specific offering.

✅ Check all of your actions against this compliance list daily throughout the entireity of the campaign.

✅ Don't be tempted into doing something that is against regulations. Don't do it. Someone else may be breaking the rules, but do not be tempted by their actions. A rule being broken may not be appearing to be (or not being) enforced, but the rule has to be followed anyways. Enforcement lags behind the rules being broken, sometimes years after.

✅ Marketing & Advertising Readiness: Have a marketing plan built out, ready, and in place to be switched on at launch. It's a must.

✅ Creation of ad accounts, mediums, messaging, and ads.

✅ Creation of materials including graphics, infographics, and copywriting.

✅ Step #2 Services:

✅ Don't go it alone. Reach out to Russ Urban for help with Step #2.

✅ Help finding a suitable funding portal or broker dealer.

✅ Help finding a suitable attorney.

✅ Step #1-#3 Services:

✅ Full Step #1-#3 Services.

✅ Step #3: Is Your Offering Already Live?

✅ Checklist for Current Issuers. (Step #3)