Cross Aggregation of Shareholder Bases

This is where we show you how to create a profile in which investors from your competitors will see your company..

There are hundreds of methods to get in front of industry specific investors, we will show you just a few.

In this guide, we are going to show you an example of a tactic we use on social media, specifically twitter.

a. social media: investor base aggregation (twitter)

If you’re looking for ways to improve your investor acquisition, you’re not alone. Reducing the costs of investor acquisition and proving the ROI of financial marketing efforts are two of the most commonly cited marketing priorities among companies.

In the last five years, the cost of acquiring new investors has increased by over 60%/ Marketing is becoming more expensive, investors are becoming less trustworthy of brands, and companies should just give up … right?

Well, the first two statements are unfortunately correct, but rest assured, the last one is wrong. Companies shouldn’t give up — they should simply get smarter. (You have heard the saying, “Work smarter, not harder,” haven’t you?)

If you’re looking for ways to improve your investor acquisition, you’re not alone. Reducing the costs of investor acquisition and proving the ROI of financial marketing efforts are two of the most commonly cited marketing priorities among companies.

In this guide, you’ll learn the basics of investor acquisition, how to lower the cost of acquiring new investors, and how to leverage your loyal ones. By the end, you’ll be able to build an investor acquisition strategy so agile, it’ll withstand the test of time and ever-changing trends.

Keep reading or use the chapter links below to jump ahead.

  • What is Investor Acquisition?
  • Investor Acquisition Costs.
  • Improving your Investor Acquisition Programs
  • Methods of Acquiring Investors
  • Investor Retention as an Acquisition Method
  • Investor Lifetime Value ( LLV)

What is investor acquisition?

Investor Acquisition (investor awareness) is the process of bringing new customers or clients to your business. The goal of this process is to create a systematic, sustainable acquisition strategy that can evolve with new trends and changes.

Investor acquisition is important for businesses of any age and size. It allows your business to 1) make money to meet costs, pay employees, and reinvest in growth, and 2) show evidence of traction for outside parties such as investors, partners, and influencers.

Being able to systematically attract and convert new Investor keeps companies healthy and growing — and other investors happy.

At this point you may be asking, “What’s the difference between lead generation and customer acquisition?” Well, let’s break it down.

In the business world, we visualize the customer journey typically with a funnel or a similar graphic that highlights the stages in the buying process and the mindset of the prospect.

As consumers move through the funnel (as part of their journey as a buyer), they:

  • Gain awareness of your brand
  • Add your product or service to their consideration pool, and
  • Make a decision to become a paying customer of your business.

To simplify the process, lead generation typically happens at the top of the funnel, lead acquisition happens in the middle, and lead conversion happens at the bottom. And customer acquisition typically refers to the funnel as a whole.

For the sake of this guide, we’re going to use customer acquisition in reference to the top and middle of the marketing funnel — lead generation and acquisition combined.

This is because the bottom of the funnel (conversion) typically requires more dedicated, customized methods to convert customers, such as lead scoring and closing tactics.

Here’s another way to visualize it, in a less funnel-like fashion:

In the example above, customer acquisition lives in the attract phase, where consumers become readers and visitors.

So, now that we’ve defined Investor acquisition and its place in the overall marketing process, let’s dive into how to measure it.

What Is Investor Acquisition Cost (CAC)?

You’ve heard the buzzword: customer acquisition cost, otherwise known as IAC. Investor acquisition cost (IAC) is the cost associated with bringing a new investors to your business, such as marketing costs, events, and advertising. It’s typically calculated in reference to a specific campaign or window of time.

IAC is important because it assigns real value to your marketing efforts and allows you to measure your ROI — a metric inquired about by CEOs, managers, and investors alike.

How to Calculate investor Acquisition Cost

High-level investor acquisition cost is calculated by dividing marketing costs associated with a specific campaign or effort by the number of investors acquired from said campaign.

This IAC formula is

IAC = MC / IA, where:

  • IAC is investor acquisition cost
  • MC is marketing costs
  • IA is investors acquired

To get a more in-depth, accurate look at IAC, you must include all costs associated with marketing spend, including everything from campaign spend to marketing salaries to the cost of the staples used to create those lengthy contracts.

This IAC formula looks like:

IAC = (MC + W + S + OS + OH) / CA, where:

  • IAC is investor acquisition cost
  • MC is marketing costs
  • W is wages for marketing and sales
  • S is marketing and sales software
  • OS is outsourced services
  • OH is overhead for marketing and sales
  • IA is investors acquired

Where the simple IAC metric might apply to a single campaign, the more complex IAC formula should be calculated within a given window, such as one month or fiscal year. For example, if Company A spent $100,000 on customer acquisition in Q4 of 2018 and acquired 1000 new investors, the IAC would be $1000.

Regardless, IAC is a critical number to calculate (and constantly recalculate) when acquiring new investors and employing new acquisition methods.

How to Minimize Investor Acquisition Cost

Here’s a simple truth about marketing: You can always do better. You can always reach new audiences, market with better messages, and minimize associated costs.

Depending on your outlook, this could be good or bad news. Personally, I find it motivating. There’s always something to learn and always something to improve upon. Better yet, you aren’t stuck with a subpar metric that your executives or investors aren’t quite happy about.

If you’re looking to improve your IAC, here are a few ways to minimize the cost of acquiring new investors:

  • Improve your website conversion efforts. Enhance your calls-to-action, ensure your site is mobile and tablet responsive, optimize your landing pages, and clean up your copywriting. Consider A/B testing a landing page or shopping cart to see if a certain design or copywriting angle works best. These will make sure any customer acquisition methods you’re already employing are working as perfectly as possible.
  • Boost the value of your current customers. This may involve releasing a new product or upgrade in which your customers can also invest in. User value can also skyrocket when they refer other customers or simply act as promoters for your business. (We’ll touch on more of this below.)
  • Adjust and optimize your Investor acquisition strategy. Take some time to lay out your acquisition blueprint and see what each method is costing you. Where could you cut back on extra marketing spend or manpower? Costs for specific channels can rise over time, and you can always minimize IAC by finding newer, cheaper channels to invest in. This process also ensures your strategy reflects the most recent marketing trends and remains agile.

How to Improve Your Investor Acquisition Strategy

Every business needs new customers to grow and succeed, so whether you’re a company of five or 5,000, having a roadmap for investor acquisition is a smart move.

A solid investor acquisition strategy should be four things: sustainable, flexible, targeted, and diversified.

  1. Sustainable

A sustainable investor acquisition strategy is one that works in the long run. This means that the investments you make (whether money, time, or human) can be upheld for the foreseeable future. For example, if you plan to acquire new customers through a blog, you should have the tools and resources in place to ensure content production lives past one or two posts – effectively bringing in organic traffic for months or years to come. This is why inbound marketing is effective –– it creates sustainable traffic and, therefore, a sustainable source of new investors. Consider this in comparison to ads, which can be an effective way to acquire customers … as long as the ads are live.

2. Flexible

Your investor acquisition strategy should also be flexible because marketing and sales, and the way people respond to them are always changing. While salespeople were once the gatekeepers of information about a product, that’s no longer the case. investor are increasingly skeptical of brand claims and anything said about a product by the company or its reps. In a recent HubSpot Research study, we found that 88% of investors trust the advice of family and friends over businesses. Creating an investor acquisition strategy that only relies on salespeople would put your company in a tough spot. Keep your strategy pliable, and you’ll always be ready to respond to market trends.

3. Targeted

All investors aren’t your best investors, and investor acquisition can result in a crazy waste of resources if not pinpointed toward the right people. Before you invest in any investor acquisition methods, you must define who you’re targeting with said methods. The process alone of defining your buyer persona can help weed out any unnecessary or wasted acquisition efforts as well as alert you to specific needs or desires that some channels may meet. For example, businesses targeting millennials might consider creating videos as part of a content marketing strategy, given that 91% of adults ages 18-29 use YouTube.

A targeted investor acquisition strategy requires taking a step back and figuring out what’s best for your business, resources, and audience. Then, you can expect to see real responses to your customer acquisition efforts.

4. Diversified

Ever heard of cross-pollination? It’s when bees spread pollen between a variety of plants, bringing about variations of species that better withstand time and nature. In this case, marketers can be compared to these well-traveled bees. When you diversify your acquisition strategy and use various acquisition methods, you have a greater chance of reaching new audiences and generating new leads. For example, research has shown that combining paid and organic SEO efforts results in over 25% more clicks and a 27% increase in profits over isolated efforts.

Also, diversifying your investor acquisition strategy creates a balance between risk and reward, meaning if one channel begins to fail (see: salespeople example above or the declining effectiveness of organic Facebook reach), it’s easier to reallocate funds for a new, better-performing method.

Now that you know how to approach and organize your customer acquisition strategy, let’s dive into some ways to acquire customers.

How to Acquire Investors

Customer acquisition methods can be broken up into a variety of different types: paid and free, inbound and outbound, etc. The best methods for your business, however, will depend on your audience, resources, and overall strategy.

In this guide, we’re going to review four commonly used methods of acquiring new investors along with some helpful tools.

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Investor marketing