Launched in 2017, PlanSnap is an app that makes social planning simple. It helps people to agree a plan in just a few taps. It even works if some of the invitees aren’t using the app.
Founder and CEO Louise Doherty initially bootstrapped the business, using her own money and investment from an early client. She later secured a combination of angel and accelerator funding.
When it came to developing her product towards full launch, she opted to crowdfund.
The right audience
The main reason for her choice of funding strategy was demographics. PlanSnap’s target market is primarily women – market research had shown Louise that women do more social planning.
And “The chance to market the business to a large audience with a healthy female representation was very attractive,” says Louise. In addition, crowdfunding is viable even without a large customer base, which PlanSnap didn’t have at that time.
You need to spend a lot of time and energy going to events, meeting potential investors and maintaining the relationships you make.Louise Doherty
Founder and CEO
Time, effort and energy
Having decided to go the crowdfunding route, the hard work began.
“Crowdfunding is as time consuming as any other funding type,” Louise warns. “There’s far more to it than posting a video and business plan online, and waiting for the money to come in.”
Louise ran her crowdfunding campaign on Crowdcube. The process involved:
- Preparing the accounts and necessary legal documents
- Setting out the company’s strategy
- Creating three key assets for the campaign: a promotional video, business plan and financial statement
- Keeping the PlanSnap forum and blog on the Crowdcube site regularly updated with new and engaging content
- Attending tech, startup and Crowdcube events to drive interest in PlanSnap’s crowdfunding campaign
- Closing the round: communicating with investors, collecting payments and finalising the articles of association
“You need to put a huge amount of effort into the video, which needs to be really compelling, and the business plan, which requires careful thought,” Louise points out.
“And you need to spend a lot of time and energy going to events, meeting potential investors, and maintaining the relationships you make.” She says the Business Growth Programme was a great help: not just introducing her to potential investors, but running practice sessions to hone her pitch.
All that effort proved worthwhile. Against a target of £250,000, PlanSnap raised almost £380,000. Around 520 investors took just over 11% of the firm’s equity.
A crowdfunding campaign concentrates the mind, for two reasons according to Louise. It’s very public compared to other sources of finance; and it comes with a deadline.
“That makes you really think through how you’re going to communicate your business vision and goals,” she explains. “And it helps you keep focused on the people whose interest is genuine – those you believe will actually invest.”
But be mindful of the risks, she cautions. “If you don’t hit the target, you walk away with nothing. So prepare well – and make sure you have a back-up plan, just in case.”