You’ve started a crowdfunding raise for your startup – now what? If you’re excited to announce the raise, one of the ways you can do that is through a press release. A press release is a document written by an organization with the hope the media will use it in their publications. Press releases are also frequently posted to an organization’s own website, as well as social media, and you can distribute it on a newswire.
Press releases follow a general basic style that helps journalists and readers quickly gather key information. You should create the document in a word processing application, such as Word, and format your content using a common font, such as Arial or Times New Roman, 11- or 12-point font, and standard margins.
A press release should include a set of information that identifies where the release is coming from and when it can be shared. This includes the company name and logo, the company’s contact person with phone and/or email address, a note designating whether the document is for immediate release or has an embargo until a certain date, and the release’s title and dateline (which includes both the date and city/state location).
Your press release’s body content describes your main message — what your startup does and that you’re running a crowdfunding raise. Use the standard “who, what, where, why, when” questions that you probably learned in grade school to prompt your writing, and keep your information factual rather than filled with “marketing-speak” (see below for notes on compliance).
The inverted pyramid is a type of writing organization that might be helpful to guide you as you write the press release. In this format, you start with broad statements that let your reader know immediately what is the “big picture.” You progressively provide more details in the next paragraph(s). A quote from your founder or a product manager, etc., may also be a good detail to close your body content (see section below about compliant statements).
While writing your body content, consider how to best tell your story. Think about what the reader would want to know, not necessarily what you think is important. Know who your target audience is and write with that person in mind. Using active verbs instead of passive language (e.g., “there is”) can also help create more engaging content for your reader.
After you’ve written the body content of your announcement, you will need to add information about your company. The boilerplate is a concise paragraph featuring the “about” information or bio language for your company. This short section provides a description of your company, as well as links to your website and any social sites, if applicable. The boilerplate section should be placed at the end of your press release.
Conclude your press release with three pound symbols (###) on the line below the end of your content. This symbol indicates to the reader that there is no further content in the release.
In addition to writing an accurate and engaging press release, you also need to consider regulatory rules concerning securities offering communications. When conducting a regulation crowdfunding raise, you must follow U.S. Securities and Exchange Commission (SEC) rules regarding “terms” and “non-terms” content for marketing materials. The two types are described below:
- Terms communication – details about the offering, including the amount of securities offered, the type of securities offered, the closing date of the offering, the price of the securities, etc.
- Non-terms communication – more general information about your company and its product, including a statement that you’re conducting an offering, the intermediary conducting the raise, a link to the offering page, and facts about the business
Terms and non-terms content cannot be mixed. For a press release, you likely want to use non-terms content, or you will be limited in how useful your release document is. If you include a quote from someone in your company, make sure it is a broad statement such as “We’re excited to be making this crowdfunding opportunity.” Check out our previous blog post on Marketing Your Regulation Crowdfunding Raise for more information about how you can talk about your raise, and you can review the Regulation Crowdfunding advertising guidelines here.
Also, keep in mind that you can’t market your raise until after it is live, so while it’s a good idea to have your press release written and ready to go ahead of time, don’t distribute it until the raise is live.
The information presented here is for general informational purposes only and is not intended to be, nor should it be construed or used as, comprehensive offering documentation for any security, investment, tax or legal advice, a recommendation, or an offer to sell, or a solicitation of an offer to buy, an interest, directly or indirectly, in any company. Investing in both early-stage and later-stage companies carries a high degree of risk. A loss of an investor’s entire investment is possible, and no profit may be realized. Investors should be aware that these types of investments are illiquid and should anticipate holding until an exit occurs.