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Benefits of Crowdfunding for Small Business – Besides Raising Money

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Benefits of Crowdfunding for Small Business – Besides Raising Money

January 03
21:18 2022

When businesses consider crowdfunding, there’s usually one purpose: to raise the capital they need. Crowdfunding is a great way of unlocking the funding businesses need for growth that otherwise might be difficult to attain. Instead of relying on a bank or scrimping and saving for years, businesses can use community connections to reach their next step.

By using a Honeycomb crowdfunding campaign as a growth tool, businesses can strengthen customer and community relationships, generate marketing awareness, increase revenue, and unlock opportunities for collaboration in their neighborhoods.

If a customer invests in a business, they’re not only more likely to continue to give their business but are also more likely to tell their social network about the business they invested in. Their relationship with the business goes beyond just buying a product or service – it shows they’re a superfan and are interested in the business’s success. 

Millie’s Homemade Ice Cream raised $50,000 to purchase a new ice cream truck, bringing their delicious ice cream to the road!

Small business owners like Chad Townsend, co-owner of Millie’s Homemade Ice Cream in Pittsburgh, have been able to form meaningful relationships with customers as a result of their Honeycomb campaign.  

“I would say at least once a week, we have someone who comes up to us and says, ‘Oh hey, I’d like to meet you, I invested through Honeycomb,’” says Chad. “We’ve made some friends. It’s been really interesting, it’s definitely shown to be a community and network.”

“I don’t like to ask for money,” says Jeanne Herbert, co-owner of My Goodness Market in Pittsburgh. “So [the Honeycomb campaign] was really great because we could say, ‘We’re giving you an opportunity to help us grow, and you can actually have a good investment that you feel good about.’”  

Another added benefit of crowdfunding with Honeycomb is that it generates marketing buzz for businesses. It does this in several different ways:

First, by creating a campaign page—which includes a professionally shot video, detailed story of the entrepreneur, business, and campaign, and all the financial details of the crowdfunding raise.

Second, Honeycomb will boost a business’s campaign on their social media, introducing it to thousands of investors. This is a great way to market a business to a national network of community-minded investors. 

Finally, Honeycomb campaigns receive on average 7 press mentions. This is a double whammy, because it can not only market a business to the public, but also its campaign, and possibly compel people to invest in said campaign. 

This marketing buzz was especially important to Kylie Primus, owner of Games Unlimited in Pittsburgh. Games Unlimited was struggling because the coronavirus pandemic caused them to temporarily close and furlough employees. They were able to raise $23,935 to keep them running during that difficult time. 

“We have gotten so many emails from customers since the program went live, which has further increased our ability to engage with them, a form of marketing that is critical when the storefront itself is closed,” he notes. 

The combination of increased customer support, an infusion of capital, and marketing buzz leads to better business for those who crowdfund through Honeycomb. On average, businesses that have crowdfunded through Honeycomb have seen a 60% increase in revenue in a year after their campaign closed.

Will Patterson, co-owner of Pittsburgh Pickle Company, says, “The funding really allowed us to pull the trigger. I don’t know if we would’ve ever done co-packing without the loan, and now, co-packing could represent a very significant portion of our revenue stream.” 

The Pittsburgh Pickle Company was able to begin co-packing, increasing their production and distribution potential with the help of their small business loan from Honeycomb. They raised $50,000 to buy new pickling equipment to get them set up for co-packing.

“Being associated with other small businesses, as well as Honeycomb itself, expands your profile to other people,” says Luke Cypher, owner of Blue Sparrow Food Truck. “I think that’s always going to be a benefit, as being a part of something makes you a part of something bigger.”

Whether it’s a network of community partners, collaborators, and customers or the tools they need to get ahead in growth, Honeycomb loans come with so much more to offer.

Learn more about Honeycomb Credit small business loans at www.honeycombcredit.com/grow and fill out the form below for more information! 

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Company Name: Honeycomb Credit
Contact Person: Samantha Graf
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Country: United States
Website: https://www.honeycombcredit.com/