The Ultimate Guide to Raising Capital Online

What is Raising Capital Online?

Raising capital online has gained immense popularity in recent years due to its accessibility, efficiency, and potential to reach a global pool of investors. 

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By leveraging digital platforms, businesses can showcase their offerings to a wider audience, streamline the capital-raising process, and build an engaged community that’s invested in their success. 

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Online capital raising encourages companies to diversify their funding source, reducing the risks associated with relying on a single investor.

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When raising capital online, businesses leverage dedicated platforms to:

• Showcase their investment opportunities to a wide audience
• Process investments digitally, often in smaller amounts than traditional raises
• Engage with potential investors through digital marketing and communication tools
• Manage investor relations and reporting through integrated online systems
• Access a broader range of funding opportunities not available through traditional channels

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This approach differs from traditional fundraising methods by:

• Expanding the potential investor pool beyond venture capitalists and angel investors
• Streamlining the investment process through technology
• Allowing for more flexible funding structures and investment amounts
• Providing opportunities for retail investors to participate in private company investments
• Helping companies raise funds more efficiently and with greater transparency

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Raising capital has gained significant traction in recent years, largely due to regulatory changes like the JOBS Act. These changes have opened up new avenues for companies to solicit investments publicly, democratizing the capital raising process. Historically, investing in private companies was restricted to accredited investors—high-net-worth individuals, institutional investors, and other financial professionals. Today, the landscape has shifted dramatically.

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This shift comes at a crucial time. Venture capital deal counts have been hovering near multiyear lows for over eight quarters, and even in the best market conditions, only a small fraction of venture capital is deployed to companies founded by women, minorities, LGBTQ+ individuals, or teams located outside major tech hubs. Interestingly, these underrepresented groups have shown substantially higher success rates when raising capital through digital platforms.

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Platforms like DealMaker have further revolutionized the process, offering end-to-end solutions that empower businesses to raise capital efficiently and on their own terms. These platforms provide the tools and infrastructure needed to reach a broader investor base, manage the fundraising process, and maintain investor relations—all in a digital environment.

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Whether you’re a startup seeking seed funding or an established company looking to fuel growth, raising capital online offers a powerful alternative to traditional fundraising methods. It provides access to a wider pool of investors, offers more flexible funding structures, and can be particularly beneficial for businesses traditionally underserved by conventional venture capital. Online capital raising also allows businesses to better assess and meet their funding needs at every stage of growth.

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In the following sections, we’ll explore various ways you how raising capital online can work, key considerations for choosing a platform, and strategies for running a successful campaign. This guide will equip you with the knowledge and tools to navigate this new frontier of fundraising effectively.

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Why Choose to Raise Capital Online?

The advantages of online capital-raising over traditional methods are numerous and compelling:

• Unprecedented Accessibility: Online capital-raising opens your doors to a global pool of investors, including accredited investors, institutional investors, and retail investors passionate about your industry or mission. This vastly expands your potential investor base and increases your chances of securing the necessary funds. Additionally, online capital raising enables businesses to access funds and financial resources from a global network, making it easier to secure capital from diverse sources. ‍
• Streamlined Efficiency: Online platforms automate and streamline many aspects of the raise process, significantly reducing the administrative burden on your team. From investor onboarding and KYC (Know Your Customer) checks to payment processing and document management, these platforms handle the heavy lifting, allowing you to focus on growing your business. ‍
• Cost-Effectiveness: Compared to traditional funding methods, online capital-raising can be more cost-effective. You can save on expenses associated with roadshows, printing prospectuses, and engaging intermediaries. Another key consideration: when you go the traditional route, you might spend tens of thousands of dollars and months of valuable time pitching VCs and institutions, only to be told “no” by all of them. This happens more often than you’d think—and it’s a colossal waste of resources for those companies. Online capital raising can also offer lower interest rates compared to some traditional financing options, making it a more affordable way to secure funding. ‍
• Targeted Marketing: Some online platforms offer sophisticated marketing tools that allow you to target specific investor demographics based on their interests, investment history, and—if you raise with DealMaker—their position in the checkout funnel. This targeted approach can significantly improve your lead generation and conversion rates. ‍
• Community-Building: Online funding platforms often have built-in features that facilitate communication and engagement with your investors. This can help you build a loyal community of supporters who are invested in your success and may become valuable brand advocates. By nurturing these relationships, you can tap into a network of individuals who can provide valuable feedback, referrals, and ongoing support. ‍
• Faster Funding: Online capital-raising can be significantly faster than traditional methods. With the ability to reach a wider audience and streamline administrative tasks, businesses can secure funds more quickly, allowing them to focus on executing their growth plans and achieving their goals. Demonstrating strong growth potential can help attract the right investors faster, ensuring you secure the capital you need to scale.
• Increased Transparency: Online platforms promote transparency by providing investors with easy access to information about the offering, the company, and the terms of the investment. This transparency helps build trust with potential investors and can lead to more informed investment decisions.

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Who Can Raise Capital Online?

Online capital raising isn’t limited to startups - it’s a versatile tool for companies at every stage of their growth journey, from pre-revenue startups to post-IPO public companies.

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Here’s how different company stages leverage digital capital formation:

• Early-Stage Startups: Reg CF allows pre-revenue companies to raise up to $5M from retail investors, perfect for validating market demand while building initial capital and customer base. Many startups progress through multiple funding rounds, including venture capital funding from venture capital firms, as they grow and seek additional resources. These companies often use their raise as a powerful marketing tool, turning early adopters into invested advocates who help drive product development and market penetration.
• Growth-Stage Companies: Reg A enables raising up to $75M annually, ideal for companies with proven traction seeking expansion capital without diluting control to VCs or going fully public. This stage is perfect for companies ready to scale operations, enter new markets, or accelerate product development while maintaining founder control and building a loyal customer-investor community. Funding rounds at this stage are often critical milestones, helping companies attract venture capital firms and secure the capital needed for further growth opportunities.
• Established Private Companies: Companies like LiquidPiston have raised $50M+ across multiple online campaigns, using continuous capital raising to fuel R&D and market expansion while maintaining independence. These mature companies leverage their track record and existing customer base to attract retail investors who believe in their long-term vision, often raising capital for specific projects or market opportunities. Further rounds of funding can unlock new growth opportunities and attract external investors interested in supporting expansion or preparing for exit strategies.
• Revenue-Generating Businesses: Companies with consistent revenue streams use online capital raising to fund expansion without traditional debt or equity dilution. These businesses can demonstrate clear use of funds and provide investors with transparent financial performance, making them attractive to retail investors seeking tangible business opportunities.
• Public Companies: Even post-IPO companies leverage online capital raising. Monogram Orthopaedics raised $13M through Reg A after their NASDAQ listing, proving public companies can tap retail investors for strategic growth capital. Public companies use this approach to fund specific initiatives, expand their shareholder base, or raise capital more efficiently than traditional secondary offerings.
• Mission-Driven Organizations: Companies with strong social or environmental missions find retail investors particularly receptive to their stories. These organizations can build communities of aligned investors who support both financial returns and positive impact, creating powerful networks of brand ambassadors and repeat investors.
• Consumer-Facing Brands: Companies with direct consumer relationships have a built-in advantage in online capital raising. Their customers already understand and use their products, making them natural investor candidates. This creates a powerful flywheel where customers become investors, and investors become more engaged customers and advocates.
• Rolling Raise Strategy: Modern companies don’t raise once - they build “forever fundraising engines.” Our most successful clients run always-on campaigns, raising capital continuously as opportunities arise, with 80% of our customers conducting multiple raises with us annually. This approach works across all company stages, allowing businesses to maintain momentum, capitalize on market opportunities, and build stronger investor relationships over time.

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The key insight: Online capital raising has evolved from a startup-only tool to a comprehensive capital formation strategy for companies at every stage.

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Whether you’re validating your first product or expanding post-IPO, digital capital formation offers the flexibility, cost-effectiveness, and community-building power that traditional methods simply can’t match.

How to Raise Capital Online - Offering Types

The JOBS Act of 2012 revolutionized capital raising by creating new pathways for companies to access retail investors online. This landmark legislation introduced multiple offering types designed to serve businesses at different stages and with varying capital needs.

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The key to successful online capital raising lies in selecting the right regulation for your current situation - whether you’re a pre-revenue startup looking to validate market demand, a growth-stage company seeking expansion capital, or an established business planning strategic initiatives. A solid business plan and a clear financial strategy are essential for determining the best offering type, as they help define your funding needs, allocation of funds, and long-term financial goals.

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It’s important to note that these aren’t mutually exclusive choices. Many successful companies use multiple offering types throughout their growth journey, starting with one regulation and progressing to others as their business evolves, capital requirements change, and investor relationships mature.

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Regulation Crowdfunding (Reg CF):

Reg CF allows businesses to raise up to $5 million per 12-month period from both accredited and non-accredited investors. This offering type is ideal for early-stage startups seeking seed funding and companies with a strong consumer following. Reg CF offerings are conducted through registered funding portals or broker-dealers and require certain disclosures and ongoing reporting.

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Reg CF is accessible to all investors, with investment limits based on income and net worth ($2,500 minimum for most retail investors). Companies can market their offerings through social media, email, and other channels to drive awareness, making it perfect for consumer brands looking to turn customers into invested stakeholders. When communicating with potential investors, it is important to prepare a compelling pitch deck and clearly outline the equity share being offered, as these materials help set expectations and attract interest.

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The minimal ongoing reporting requirements and relatively quick launch timeline (often within 60-90 days) make it ideal for businesses seeking market validation alongside capital. Many successful Reg CF companies use their raises as powerful marketing campaigns that build brand awareness while raising capital.

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Regulation A+ (Reg A):

Reg A offers two tiers for raising capital. Tier 1 allows businesses to raise up to $20 million from both accredited and non-accredited investors. Tier 2 allows issuers to raise up to $75 million, but has more stringent requirements.

Reg A requires audited financial statements and ongoing reporting, making it suitable for more established companies seeking growth capital. Accurate reporting of operating expenses is essential to provide transparency and build investor confidence. Reg A offerings must be qualified by the SEC and may require state-level registration, depending on the tier and the states involved.

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During the qualification and valuation process, companies may use financial models such as Discounted Cash Flow (DCF) and comparable company analysis to determine appropriate offering terms and ensure realistic valuations.

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Tier 1 requires compliance with state securities laws and audited financials for two years, with limited ongoing obligations. Tier 2 offers federal preemption from most state registration requirements but requires more comprehensive disclosure and ongoing reporting, including annual limits for non-accredited investors (10% of income or net worth).

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Both tiers allow unlimited marketing and “test the waters” communications before filing, providing access to both retail and institutional investors. The qualification process typically takes 4-6 months for Tier 1 and 6-9 months for Tier 2. Companies like EnergyX have raised $75M through Reg A, building communities of 40,000+ investors, while LiquidPiston has conducted multiple Reg A campaigns totaling over $50M.

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Regulation D (Reg D):

Reg D is a private placement exemption that allows businesses to raise an unlimited amount of capital from accredited investors. It offers more flexibility than Reg CF and Reg A but is typically used by companies with established investor relationships and a proven track record.

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Reg D offerings can be conducted under various rules, such as Rule 506(b) or Rule 506(c), each with its own requirements for accredited investor verification, general solicitation, and filing requirements with the SEC.

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Rule 506(b) allows up to 35 sophisticated non-accredited investors plus unlimited accredited investors but prohibits general solicitation, requiring pre-existing relationships with investors. Rule 506(c) permits general solicitation and public marketing but limits offerings to accredited investors only, with stricter verification requirements.

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Both rules offer unlimited capital potential, quick execution with minimal regulatory oversight, and access to sophisticated investors. Modern Reg D offerings increasingly leverage digital platforms to streamline investor management, automate compliance processes, and provide better investor experiences.

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This regulation is best suited for established companies with proven business models and existing accredited investor networks seeking large capital raises quickly while maintaining privacy around their fundraising activities. Regulation D is frequently used by private equity firms for equity funding in later-stage companies, often as a step prior to an initial public offering (IPO).

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Choosing the Right Platform

Selecting the right online capital-raising platform is a critical decision that can significantly impact the success of your fundraising campaign. Here are some key factors to consider when choosing a platform:

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• Compliance: Ensure the platform is fully compliant with all relevant securities regulations and has a strong track record of compliance. Non-compliance can lead to legal issues and jeopardize your campaign. Look for platforms that have experienced legal teams and robust compliance procedures—and keep an eye out for platforms that have been sanctioned by regulators in the past.
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• Technology: Evaluate the platform's technology infrastructure. Is it user-friendly, secure, and capable of handling high volumes of traffic and transactions? The platform should provide a seamless experience for both businesses and investors, with features like easy document uploading, secure payment processing, and real-time campaign tracking.
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• Marketing Support: Assess the marketing tools and resources the platform offers. Do they provide assistance with marketing your offering, reaching potential investors, and building a community? Look for platforms that offer customizable landing pages, email marketing tools, sophisticated data dashboards, and full-funnel transparency.
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• Fees: Understand the platform's fee structure. Some platforms charge a percentage of the funds raised, while others may have flat fees or subscription-based pricing. Make sure you have a clear understanding of all costs associated with using the platform—and remember that you get what you pay for.
• Customer Support: Does the platform offer responsive and knowledgeable customer support to assist you throughout your raise? Look for platforms with dedicated account managers, comprehensive onboarding resources, and prompt support channels to ensure you have the guidance and assistance you need at every stage of your campaign.

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DealMaker, a pioneer in online capital-raising, excels in all these areas. Our platform is built by leading capital markets lawyers, ensuring rigorous compliance with securities regulations. We leverage cutting-edge technology to provide a seamless user experience for both businesses and investors. Our marketing experts can help you craft a compelling campaign and reach the right audience. And our dedicated customer support team is always available to answer your questions and guide you through every step of the process.

Capital Raising Strategies

How to Build Your Investor Community

Marketing is the key to attracting investors and driving interest in your online capital-raising campaign. A well-executed marketing strategy can significantly increase your visibility, expand your reach, and ultimately help you achieve your funding goals. 

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Executing a strong campaign also sends a strong signal to potential investors, demonstrating your commitment and the potential of your business, which can make it easier to raise funds. When planning your marketing spend and resource allocation, it's important to consider the opportunity cost of different marketing channels to ensure your efforts are maximizing value. 

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Successful investor acquisition strategies typically focus on three core channels: owned, paid, and partner marketing.

Owned Marketing Channels

Your owned channels represent the foundation of any successful investor acquisition strategy because they provide complete control over messaging, timing, and user experience. These channels typically deliver the highest conversion rates because visitors are already familiar with your brand and have demonstrated interest by engaging with your content.

• Website: Your website is your brand's identity online, so make sure it's well-designed, informative, and easy to navigate. Include a clear call to action that directs visitors to your offering page, like an "Invest Now" button in the eyebrow or header. Follow SEO best practices to increase organic traffic and improve your online visibility. Your website serves as the central hub where all other marketing efforts should drive traffic, making it critical to optimize for conversion.

• Offering Page: This is the one place where you can share every detail of your offering—so make it count. Highlight your company's story, team, products/services, and growth plans. Make an impact with a beautifully-produced pitch video. Take the extra time to design custom graphics, integrate your branding, and share your vision. The better your offering page, the greater your conversion rate.
• Email Marketing: Build an email list of prospects, followers, and investors. Keep them informed about your campaign through regular newsletters, updates, and announcements. Personalize your emails and segment your audience based on their behavior, acquisition channel, or position in the funnel. Use compelling subject lines, engaging content, and clear calls to action to encourage recipients to visit your offering page and invest. Email marketing consistently delivers the highest ROI among owned channels, often converting at 3-5x higher rates than other channels.

• Social Media: Leverage social media platforms like LinkedIn, Twitter, Facebook, and Instagram to share updates about your campaign, engage with potential investors, and build a community of supporters. Use relevant hashtags and run targeted ads to reach a wider audience. Organic social media builds trust and credibility over time, creating a foundation for higher conversion rates when you launch paid campaigns.

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Paid Marketing Channels

Paid channels allow you to scale your reach quickly and target specific investor demographics with precision. While typically more expensive than owned channels, paid marketing enables you to reach qualified prospects who may never have discovered your company organically. The key is balancing cost per acquisition with investor quality metrics.

Paid Advertising: Invest in paid advertising on platforms like Google, Facebook, and LinkedIn to reach a targeted audience of potential investors. Use compelling ad copy and visuals to grab attention and drive traffic to your offering page. Monitor your ad performance and adjust your targeting and messaging as needed to optimize your results. Search advertising captures high-intent prospects actively researching investment opportunities, while social media advertising allows for sophisticated demographic and behavioral targeting.

Successful paid campaigns typically require significant testing and optimization. Start with small budgets to test messaging, creative, and targeting before scaling winning combinations. The most effective campaigns use retargeting to re-engage visitors who showed interest but didn't invest, often achieving 2-3x higher conversion rates on retargeted traffic.

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Partner Marketing Channels

Partner channels leverage third-party relationships and credibility to reach new audiences through trusted intermediaries. These channels often deliver the highest-quality investors because they come with implied endorsements from respected sources, though they can be the most challenging to scale consistently.

• Public Relations: Positive media attention can significantly boost your credibility and attract new investors. Secure media coverage for your campaign through press releases, media pitches, and interviews. Identify journalists and publications that cover your industry or have written about similar offerings and reach out to them with a compelling story angle. Media coverage provides third-party validation that can significantly improve conversion rates across all other channels.

• Influencer Marketing: Consider partnering with influencers, bloggers, or industry experts in your industry or niche to promote your offering to their followers. Be selective. Make sure they have a large, engaged, and real community that aligns closely with your target audience. The right match can help you reach new potential investors and lend credibility to your campaign. Industry experts and thought leaders can provide credibility that's difficult to achieve through paid advertising alone.

• Investor Events: Host virtual or in-person events to showcase your offering and engage with potential investors. These events can include webinars, Q&A sessions, happy hours, and more. Use these opportunities to present your company, answer questions, and most importantly, ask questions. Building 1:1 relationships is one of the most powerful ways to convert leads into shareholders. Events allow for deeper relationship building and often result in larger average investment amounts.

• Multi-Channel Attribution and Tracking: Understanding which channels drive the highest-quality investors is crucial for optimizing your acquisition strategy. Implement comprehensive tracking across all touchpoints to measure not just conversion rates, but investor quality metrics like average investment size, engagement levels, and likelihood to participate in future raises. The most successful campaigns typically see 40-60% of investments coming from owned channels, 20-30% from paid channels, and 10-20% from partner channels.

• Content Marketing Strategy: Develop a robust content calendar that positions your leadership team as industry thought leaders while educating potential investors about your market opportunity. Blog posts, whitepapers, and video content that demonstrate market expertise can significantly improve conversion rates by building trust before investors reach your offering page. Companies that publish regular educational content see 3x higher investor engagement rates.

• Referral Programs: Implement structured referral programs that incentivize existing investors to bring new investors to your campaign. The most effective programs offer meaningful rewards for successful referrals while maintaining compliance with securities regulations. Referral programs can account for 15-25% of total investor acquisition in successful campaigns.

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DealMaker Marketing Services offers an all-in-one suite of powerful marketing tools and services to help you maximize your campaign's success. From website design and development to investor nurturing and paid advertising, our team of marketing experts will work with you to create a comprehensive strategy tailored to your business and raise goals. 

With Marketing Services, you can focus on running your business while we take care of attracting investors and driving interest in your offering.

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Shareholder Community and Communication

Building a strong investor community is essential for long-term success in online capital-raising. Your investors are not just sources of capital; they can become brand advocates, loyal customers, and valuable sources of feedback. 

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Building stronger community and capital-customer relationships is key to maximizing the benefits of a digital raise and nurturing these relationships for long-term success.

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Hover over the boxes below to learn more about building and engaging a strong investor-customer community:

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Planning Your Capital Raising Funnel 

Successfully raising capital online requires a strategic, phased approach that builds momentum from initial market testing through campaign launch. Companies can leverage a variety of funding sources, including self funding, private investors, and accessing public markets, as part of their capital raising strategy. 

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The modern capital raising funnel consists of three critical phases: Test the Waters (TTW), SEC qualification, and live campaign execution. Each phase serves distinct purposes and requires specific strategies to maximize success.

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Test the Waters Phase

Companies who are interested in raising money online can "test the waters" and gauge the interest of potential investors, allowing them to make non-binding commitments. Available for Reg A offerings, TTW enables companies to solicit indications of interest from potential investors using marketing materials that haven't been reviewed by the SEC.

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During this phase, focus on building your investor pipeline through targeted marketing campaigns, content marketing, and direct outreach. Create compelling pitch materials, investor presentations, and preliminary offering documents to test messaging and value propositions with your target audience. The goal is to generate a substantial list of interested investors who will be ready to invest when your offering goes live.

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More brands are unlocking a multi-year raise strategy to scale and grow their business using TTW (Test The Waters) approach with Reg CF and then Reg A as a holistic approach over multiple years. Use the TTW phase to refine your investor personas, test different marketing messages, and identify the most effective acquisition channels. Track key metrics during TTW including cost per indication of interest, source attribution, investor demographics, and engagement levels.

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SEC Qualification Process

The two most time-consuming parts of this process are usually SEC qualification and preparing adequate financial statements. If you already have financial statements ready, you can cut your launch time by weeks. During this period, maintain momentum with your TTW audience through regular updates, educational content, and community building activities.

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Begin preparing for your Reg CF offering well in advance to allow ample time for document preparation, due diligence, and marketing efforts. Use the qualification period strategically to strengthen your offering materials, build your marketing infrastructure, and expand your investor pipeline. Continue content marketing efforts, speaking engagements, and PR activities to maintain visibility and credibility in your market.

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Prepare for multiple rounds of SEC comments and revisions. Use this feedback process to strengthen your offering documents and business strategy. Each round of comments provides an opportunity to clarify your value proposition and address potential investor concerns proactively.

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During qualification, finalize your marketing strategy, creative assets, and campaign timeline. Build relationships with media contacts, industry influencers, and potential strategic partners who can amplify your message when you go live.

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Live Campaign Execution

The live campaign phase requires flawless execution of your pre-planned marketing strategy while maintaining the flexibility to optimize based on real-time performance data. Launch with a coordinated push across all marketing channels, leveraging the momentum built during TTW and qualification phases.

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Implement a structured launch sequence starting with your warmest prospects (TTW participants, existing customers, email subscribers) before expanding to broader paid advertising and PR efforts. This approach creates early momentum and social proof that attracts additional investors throughout the campaign.

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Establish a timeline for securing funding, including milestones and deadlines. This will help you stay organized and ensure that you are making steady progress towards your capital raising goals. Monitor key performance indicators daily, including conversion rates by source, average investment amounts, investor demographics, and campaign velocity. Be prepared to reallocate budget quickly between high-performing and underperforming channels.

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Maintain consistent communication with your investor community throughout the live phase, providing regular updates on campaign progress, company milestones, and market developments. Transparency about your fundraising progress often creates urgency that drives additional investments.

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Cross-Phase Strategy Integration

The most successful capital raises treat all three phases as interconnected parts of a comprehensive strategy rather than isolated activities. Insights gained during TTW inform qualification strategy, while qualification feedback shapes live campaign execution.

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Build your investor database continuously throughout all phases, segmenting contacts by engagement level, investment capacity, and source. This database becomes a valuable asset for future raises and ongoing investor relations activities. Over 80% of DealMaker's customers do multiple raises. Create and execute a multi-raise strategy aligned to your growth trajectory - from seed and growth to IPO and beyond.

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Plan your timeline carefully, accounting for potential delays in SEC review and market conditions. Launch campaigns during favorable market windows while maintaining flexibility to adjust timing based on external factors. Having a well-prepared campaign ready to launch quickly when conditions are optimal often makes the difference between a successful raise and a missed opportunity.

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Technology and Process Optimization

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Online platforms automate and streamline many aspects of the raise process, significantly reducing the administrative burden on your team. From investor onboarding and KYC (Know Your Customer) checks to payment processing and document management, these platforms handle the heavy lifting, allowing you to focus on growing your business.

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Establish clear processes for lead qualification, investor communication, and performance tracking before launching your TTW phase. Having robust systems in place allows you to scale your efforts effectively and maintain high-quality investor relationships throughout the entire funnel. Well-organized campaigns create seamless experiences for investors while maintaining systematic operations behind the scenes.

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Costs, Timelines, and Resourcing 

Planning a successful online capital raise requires careful consideration of costs, timelines, and resource allocation. While every campaign is unique, understanding the directional requirements for each offering type helps companies budget appropriately and set realistic expectations for their fundraising journey.

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Online capital raising costs vary significantly based on offering type, raise amount, and marketing strategy. Reg CF campaigns typically require lower upfront investment due to streamlined compliance requirements, while Reg A offerings involve more substantial legal, accounting, and marketing expenses due to SEC qualification requirements. Key cost categories include legal and compliance fees, accounting and audit expenses, marketing and advertising spend, platform fees, and ongoing operational costs. Marketing typically represents the largest variable expense, with successful campaigns often investing significantly in investor acquisition across multiple channels.

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When evaluating funding options, it's important to note that some, such as loans or debt financing, require repayment with interest payments, which can be tax-deductible but also add a financial burden. Other options, like using your own capital, do not require repayment but may impact your risk exposure and growth potential.

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Companies should budget for both fixed costs (legal, accounting, platform setup) and variable costs that scale with campaign performance (marketing spend, payment processing). The most successful raises treat marketing investment as growth capital rather than pure expense, focusing on sustainable investor acquisition costs.

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Resource requirements often scale non-linearly with campaign size and complexity, with larger campaigns potentially requiring proportionally more marketing spend to achieve the same conversion rates.

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Timeline planning varies dramatically by offering type and significantly impacts resource allocation decisions. Reg CF campaigns can launch relatively quickly, often within 60-90 days of initial planning, due to streamlined regulatory requirements.

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The timeline includes campaign preparation, platform setup, marketing material creation, and regulatory filing. Reg A campaigns require substantially longer timelines due to SEC qualification requirements, typically involving several months of preparation followed by 4-9 months of SEC review and qualification.

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Companies should plan for multiple rounds of SEC comments and revisions during the qualification period. Reg D offerings can move most quickly for companies with established investor relationships, potentially launching within 30-60 days, though companies using general solicitation may need additional time for marketing preparation and accredited investor verification processes.

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Successful campaigns require dedicated resources across multiple functional areas throughout these timelines. Legal and compliance resources are essential for all offering types, with requirements scaling based on regulatory complexity.

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Companies typically work with securities attorneys experienced in online capital raising. Marketing and communications resources become critical for campaign success, including content creation, digital marketing expertise, investor relations management, and ongoing campaign optimization.

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Many companies choose to work with specialized marketing agencies familiar with capital raising compliance requirements. Operational resources include campaign management, investor onboarding, customer service, and ongoing investor communications, with companies needing to plan for increased operational demands during active campaigns and ongoing investor relations requirements.

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Companies must decide which functions to handle internally versus outsourcing to specialized providers. Internal resources provide better control and company knowledge, while external specialists bring experience and established processes. In some cases, companies may choose to leverage their own financial resources, such as personal savings or family support, to self-fund certain aspects of the campaign, especially when handling functions internally to maintain control and manage costs.

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Common functions to outsource include legal counsel, accounting and audit services, and specialized marketing services. Many companies maintain internal control over strategy, investor relations, and core business operations while leveraging external expertise for technical and specialized functions.

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Platform selection impacts both costs and operational requirements throughout the campaign lifecycle. Self-hosted solutions like DealMaker provide greater control and branding flexibility while requiring more internal coordination.

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The choice between different platform approaches affects setup costs, ongoing fees, and operational complexity. Technology integration requirements include CRM systems, email marketing platforms, analytics tools, and investor management systems. Companies should budget for both platform costs and integration expenses when planning their technology stack.

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Companies planning multiple raises should consider building internal capabilities and systems that can be leveraged across campaigns. The investment in proper systems and processes for the first campaign often pays dividends in subsequent raises.

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Successful campaigns focus on metrics beyond just capital raised, including cost per investor acquired, investor engagement rates, and long-term investor value. Companies should establish clear success metrics and budget allocation frameworks before launching campaigns.

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The most successful companies view capital raising costs as investments in building permanent fundraising capabilities and investor communities, rather than one-time expenses. This perspective helps justify appropriate resource allocation for building sustainable competitive advantages.

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Understanding Compliance and Regulations When Raising Capital

Regulatory compliance is a non-negotiable aspect of online capital-raising. Failure to comply can result in legal repercussions, financial penalties, and damage to your company’s reputation. Understanding and adhering to the relevant regulations is crucial to protect both your business and your investors. Compared to traditional loans and traditional financing, online capital raising can offer more flexible structures that may present less risk for both companies and investors, depending on the regulatory framework and offering type. ‍

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Here’s a brief overview of the key regulatory considerations for online capital-raising in the United States:

1. Regulation Crowdfunding (Reg CF): Companies must file Form C with the SEC, adhere to advertising and disclosure requirements, and ensure none of their investors commit more than their annual maximum. Reg CF offerings must be conducted through registered funding portals or broker-dealers and are subject to ongoing reporting requirements. ‍
2. Regulation A+ (Reg A): Companies must file Form 1-A with the SEC, provide audited financial statements, and adhere to ongoing reporting requirements. Reg A offerings must be qualified by the SEC and may require state-level registration, depending on the tier and the states involved. Issuers that plan to raise capital throughout the US can greatly reduce their burden by engaging a registered broker-dealer. ‍
3. Regulation D (Reg D): Companies must file Form D with the SEC after the offering closes. Reg D is split into two subcategories:some text
4. Reg D 506(b): Under 506(b), issuers can raise an unlimited amount of capital from an unlimited number of accredited investors and up to 35 non-accredited investors, provided they meet certain requirements. However, companies using this exemption cannot use general solicitation or advertising to market the securities. ‍
5. Reg D 506(c): This exemption allows issuers to advertise their raise to a broader audience. However, all investors in a 506(c) offering must be accredited—and the issuer must take reasonable steps to verify their accreditation status.

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In addition to these federal regulations, businesses raising capital digitally must also comply with state securities laws, also known as “blue sky laws.” These laws vary by state and may require additional filings, disclosures, or registrations. ‍

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To navigate this complex regulatory landscape, it’s essential to work with experienced legal professionals who specialize in securities law. They can help you determine the most suitable offering type for your business, guide you through the filing process, and ensure ongoing compliance with all applicable regulations. ‍

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DealMaker’s platform is designed with compliance in mind. With built-in compliance features, such as KYC/AML checks, investor accreditation verification, and registered broker-dealer services, DealMaker streamlines the compliance process, giving you peace of mind and allowing you to focus on your raise.

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Case Studies: Success Across Industries and Stages

Community capital raising has proven its versatility across diverse industries and company stages, from pre-revenue startups to post-IPO public companies. Companies raise capital for various reasons, such as expanding operations, acquiring competitors, or restructuring to support their growth strategies.

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The following case studies demonstrate how businesses in different sectors and at various growth phases have leveraged online capital raising to fuel growth, build engaged investor communities, and achieve their strategic objectives.

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These examples showcase the flexibility of digital capital formation, highlighting successful campaigns in technology, consumer products, energy, healthcare, entertainment, and beyond.

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Whether companies are seeking initial seed funding, scaling operations, or pursuing strategic expansion, community capital raising offers a powerful alternative to traditional fundraising methods.

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Frequently Asked Questions

Whether you’re considering your first capital raise or planning your next campaign, these commonly asked questions address the key practical and regulatory considerations for online capital raising. From understanding different offering types to managing post-raise investor relations, these answers provide clarity on the most important aspects of digital capital formation.

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Get Started

Ready to transform your capital raising strategy? Whether you’re planning your first online raise or looking to optimize your existing approach, DealMaker provides the technology, expertise, and support to help you succeed. Working with an investment banker can further enhance your capital raising strategy by leveraging their expertise in pricing and structuring your financial offerings for optimal results.

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Book a Demo to see how our platform can streamline your capital raising process, or explore our guides for additional resources on planning and executing successful online campaigns.

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