The 17 decisions to make before your crowdfunding raise launches

Before a crowdfunding raise can launch, the founder has to make about seventeen decisions: how much to raise, under which exemption, in what security, at what valuation and share price, with what minimum, perks, platform, timeline, budget, and team. Most founders know about three of them. The rest surface one at a time, usually while someone is waiting on an answer, and each late answer pushes the launch back. Make them early, write them down, and the raise moves.

Many of these decisions end up in the offering documents. Once the raise is live, changing them can mean an amendment, and sometimes asking investors to reconfirm. So treat this list as the work that comes before the work. Your securities counsel should review every decision that touches the offering itself.

The offering

These decisions define what investors are buying. Counsel drafts them into the filing.

1. The exemption. Reg CF for most founders, Reg A+ for the few with a proven audience, and possibly a Rule 506(c) offering alongside either one. See Should you do a Reg A+ if you have never done a Reg CF? and Should you run a Reg A+ and a Reg D at the same time?.
2. How much to raise. A minimum target and a maximum. The target is the number you must reach to close. The maximum is the most you will accept. Under Reg CF the amount also decides what level of financial review you need. See Reg CF limits, explained for the person running the raise.
3. The security. Common or preferred equity, a SAFE, a convertible note, or a revenue share. Each one tells investors something different about what they own and when they might see a return.
4. The valuation. What the company is worth before the money comes in. It has to be defensible, because investors and the press will compare it with your traction.
5. The share price. This is a design choice, set by how many shares the company divides itself into. The valuation stays the same whatever the price. A simple, round price makes it easy for an investor to work out how many shares they are buying, which is one less calculation before they move forward. Decide it with counsel.
6. The minimum investment. The smallest check you will accept. Lower minimums let more people in. Higher minimums mean fewer, larger investors and less work per dollar.
7. Perks and bonus shares. Tiered rewards, early-bird bonuses, and volume bonuses. They must be in the offering documents and are hard to change after launch. See Investor perks and bonus shares, and how to set them before launch.
8. Use of funds. What the money will be spent on, in what proportions. Investors read this closely, and it must match what you tell them in the marketing.
9. The level of financial review. Reviewed or audited financial statements. Your raise amount sets the floor; some companies choose an audit anyway because it builds confidence.

The campaign

These decisions shape how the raise runs.

10. The platform. Which funding portal or broker-dealer hosts the offering. Compare fees, investor experience, data access, and what they expect you to bring. See The best equity crowdfunding platforms, ranked for issuers.
11. Whether to test the waters first. Almost always yes. It is how you build the list that decides your first week. See Testing the waters: how to build the audience before you can take a dollar and Reservation setups for a raise: your page or the portal.
12. The raise length. How long the offering stays open. Long enough to build momentum, short enough to keep a real deadline in front of investors.
13. Rolling or intermediate closes. Whether you will take money out of Escrow in stages once you pass the target, or wait for one final close. See Escrow, rolling closes, and missing your target.
14. The public face. Who appears in the video, the ads, and the interviews. Usually the founder. Whoever it is needs to be available for shoots and approvals throughout the raise.

The money and the people

These are the decisions founders most often skip, and the ones that cause the most trouble when they do.

15. The raise budget. How much you will spend to raise the money. Crowdfunding is not free money. There are legal, accounting, platform, and escrow fees, creative and technical work, and ad spend, and a meaningful part of that has to be paid before launch, from your own funds, existing investors, or operating profits.
16. Who does what. Separate lanes for who decides and who does the work, written down before anyone starts. The roster, and what to ask each party, is in Who is on the team for a Reg CF or Reg A+ raise, and what to ask each of them.
17. Who owns the raise. One person who can drop everything and answer in minutes, so no decision stalls. See Why your crowdfunding raise needs a single person running it.

Which decisions come first?

Some decisions depend on others, so the order matters.

• Start with the budget and the owner. Without a budget you cannot plan the rest, and without an owner nobody is making the other sixteen calls.
• Then the exemption and the amount. They set the rules for everything else: what you can say, how much you can raise, and what financial review you need.
• Then the terms. Security, valuation, share price, minimum, perks, and use of funds go into the filing together, so decide them together.
• Then the platform and the calendar. Platforms differ on what terms they accept, and the calendar runs backward from the launch date you can actually hit.

Any one of these decisions can take a week if nobody owns it. All seventeen, made in order by one person with the authority to make them, can take far less.

The checklist

Copy this and fill it in before any work starts:

• Exemption
• Minimum target and maximum
• Security type
• Valuation
• Share price
• Minimum investment
• Perks and bonus tiers
• Use of funds
• Reviewed or audited financials
• Platform
• Testing the waters plan
• Raise length
• Rolling closes or one final close
• Public face of the raise
• Raise budget, and where the up-front money comes from
• Who decides and who does the work
• The Raise Owner

FAQ

What do you need to decide before launching a crowdfunding campaign?

The exemption, the raise amount, the security, the valuation and share price, the minimum investment, perks, use of funds, the level of financial review, the platform, whether to test the waters, the raise length, whether to use rolling closes, who is the public face, the budget, who does what, and who owns the raise.

Can you change the terms of a crowdfunding offering after it launches?

Sometimes, but it is costly. A material change to the terms usually needs an amendment to the filing, and under Reg CF investors who already committed may have to reconfirm or lose their investment. Decide the terms before launch so you do not have to change them.

How do you choose a share price for a crowdfunding raise?

The share price is set by how many shares the company is divided into, so you can choose it without changing the valuation. A simple, round price makes it easy for investors to work out how many shares they are buying. Decide it with your securities counsel.

Who should make the decisions for a crowdfunding raise?

One person, the Raise Owner, with the authority to decide or a direct line to whoever does. Many people work on a raise, but decisions made by committee or left waiting on a busy CEO are the most common reason a launch slips.