Cheat Code to Raise Money

IN PARTNERSHIP WITH BOOZ BOX

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Booz Box does things differently, like putting their beverages in versatile box containers. They’re also giving their earliest fans a chance to invest in the company.

If you would like to learn more about becoming an early investor in their company, check out the link below!

FREE FUNDRAISING TRICK EMERGES

Getting my wife to stay awake for an entire episode of Severance and obtaining funding for an early stage startup - two things that are CHALLENGING.

Whether you’re raising from a handful of VCs or thousands of retail investors - it’s a huge investment of time & resources. 

It’s also extremely competitive - in the crowdfunding world there are currently 535 startups raising funds.

The same tricks that work with venture capitalists don’t always translate to raising money from hundreds on investors in a crowdfunding round.

Some companies are beginning to crack the code and turning a challenge into a money-printing fundraising hack.

Most startups devote all their time & energy figuring out a way to stand out from the other 534 startups raising money.

But a select few are approaching things entirely differently.

Instead of competing with the other 534 startups, they’re using them to their advantage.

That mindset is where a clever and scrappy tactic is taking hold: cross-promotion.

This idea, borrowed from newsletter operators and bootstrapped content creators, is now gaining momentum in the startup ecosystem. 

At its core, it’s a simple trade: two startups agree to promote each other’s crowdfunding campaigns to their respective audiences.

Startup A features Startup B’s funding round in their email newsletter, and Startup B returns the favor in theirs.

No money changes hands. Each startup gets fresh exposure. And both benefit from the credibility boost of a peer recommendation. It’s simple, effective, and budget-friendly.

In an environment where attention is currency and budgets are tight, cross-promotion has become a savvy way for startups to grow their reach - and their cap tables.

A PAGE FROM NEWSLETTER OPERATORS

As a newsletter operator myself, I’m very familiar with the growth challenges that newsletters face.

Every day I wake up thinking about how to grow my newsletter - there are free things that can pay off in the long-term; great content, SEO, social posting for example.

And then there’s sweet, sweet Facebook ads.

Facebook ads can churn out subscribers like magic, but each one comes at a price. In the 2010’s, that price was something like $0.50.

And if each subscriber is worth $3 to you (from ads and other sales), then that’s an infinite money glitch. 

The founder of Morning Brew recently mentioned on a podcast that they were spending $500,000 a month at one point on Facebook ads.

Nowadays, Facebook CPMs are much higher than they once were. Back when I ran ads, I was acquiring subscribers for $2.50-$3.50 apiece.

That’s not as solid of a business model, so many content creators began testing cross promotions with other creators.

In the newsletter world, it grew so much that there is now an entire website dedicated to pairing newsletter operators together.

Founders are in the same boat - increased CPMs harm how efficiently they can raise capital.

Rather than spend a ton of money on ads to raise money (giving up equity in the process), they’re branching out to partner with other startups.

If your startup is raising on Wefunder and has a few thousand email subscribers, you can partner with another startup raising on the same (or even a different) platform.

You promote their raise in your next investor update or community email, and they do the same for you. This cooperative spirit helps both startups reach new potential investors who are already primed to invest in early-stage businesses.

WHY CROSS-PROMOTION WORKS

There are several reasons this tactic is gaining traction.

1. Investor Overlap

Startups that crowdfund often attract a similar type of investor: someone excited by innovation, eager to support emerging companies, and comfortable with risk.

If a person has already invested in one startup, there’s a good chance they’re open to backing another. By tapping into each other’s investor communities, startups expand their pool of warm leads.

2. Trust by Association

When a startup promotes another company’s raise, it sends a subtle signal of trust.

The message is, “We think these guys are worth checking out.”

For early-stage investors who rely on social cues to make decisions, this endorsement can go a long way.

3. Cost-Effective Growth

Paid acquisition can be expensive—and risky. Ad performance on platforms like Facebook and Instagram has become increasingly volatile, with high customer acquisition costs and strict ad policies around financial promotions.

In contrast, cross-promotion is free. It requires time, not money, which is a trade-off most founders are happy to make.

HOW STARTUPS ARE EXECUTING

Cross-promotion can take many forms:

• Email Mentions: The most common method. Startups will include a short blurb about a partner raise in their next investor update or marketing newsletter.

• Social Media Shoutouts: Founders will share a post about their partner startup on LinkedIn, Twitter, or Instagram.

• Pitch Decks and Updates: Some startups are even including links to partner raises in their investor updates or pitch videos on crowdfunding pages.

• Community Events and Webinars: A few startups are co-hosting AMAs or webinars to introduce each other to their communities.

Here’s a snippet from a cross-promo email I received from one of my portfolio companies, Azure Printed Homes:

One thing that’s key is finding the right kind of startup to partner with. 

For example, a sustainable fashion startup might partner with a DTC beauty brand to swap promotional emails. A robotics startup could pair up with a drone company, appealing to tech-forward audiences.

The key is not necessarily industry alignment, but audience fit. The better the match, the more likely it is that investors from one raise will be intrigued by the other.

In the example above, I’m not sure a an alcohol brand & 3D-Printed Home Builder is a match made in heaven, but since this is free there’s not much risk involved.

DOES CROSS PROMO WORK?

We have yet to see data on the efficacy of cross promotion with equity crowdfunding, but regular crowdfunding (think Kickstarter) has been using this tactic for a while and has some stats.

• Conversion Rates: Cross-promotions in crowdfunding campaigns typically achieve conversion rates between 4% and 16%, with some instances reaching up to 20%.

• Revenue Impact: Effective cross-promotions can generate additional revenue per update, ranging from $2,000 to $7,000.

If equity crowdfunding can achieve anywhere near this level of success, it would be transformational to many raises - especially those looking to raise ~$100k.

There are dozens of founders that read this newsletter - if you’re one of them and actively raising, respond to this email if you’re interested in doing a cross-promo with another startup.

I’ll connect you ✨ free of charge ✨ if there’s a good match!

If you’re an investor in a startup that isn’t getting enough attention, forward this to the founder so that I can pair them up!

 _{and if YOU aren’t getting enough attention it’s because you’re ugly.}