Crack the Crowd, Title 3 Crowdfunding & JOBS Act Overview

Title 3 Overview
Crack the Crowd 
1387 E. 3010 S.
Salt Lake City, UT
Speaker
Dan Baird

“Never doubt that a small group of thoughtful,
committed citizens can change the world; indeed, it's
the only thing that ever has.”
- Margaret Mead

Dan BairD
!
" dan@crackthecrowd.com
LinkedIn.com/danbaird
twitter.com/whistln
#
Crack the Crowd was founded to address an all-too-common problem: business
owners found themselves spending thousands of dollars hiring consultants or
managers without crowdfunding experience, who despite good eﬀorts, made
avoidable mistakes. For that reason, I created an agency speciﬁcally tailored to
crowdfunding.
With our services, tools, and practical execution plans, we can maximize your
team’s productivity without losing your authenticity. We’re here to highlight your
expertise, streamline your operation, and impart the insights on crowdfunding and
launching new ventures.
We’re excited to be a part of your success.
- Dan Baird, CEO

' !info@CrackTheCrowd.com
CrowdFunding Consulting
Get access to experts in strategic innovation, branding, human-oriented
design, and of course, crowd-engagement. Our team has collaborated on
dozens of white-label equity, real estate, and reward platforms; we can
help you launch your platform, put it in the spotlight, and ensure you will
be able to scale, grow, and succeed.
Platform Strategies
$
• Branding
• Quick launch Guides
• White Label Materials
• UX Testing
Portal Creative
%
• Marketing Automation
• Social Media
• SEO & PPC
Campaigns
• Email Marketing
Ads & Promotion
• Launch Coordination
• Marketing Automation
• CRM Management
• Sales Consulting
Growth
&

(
“Crowdfunding” 5
“Crowdfunding is a method of financial
intermediation, enabling efficiency in the
identification, participation and funding of
investment opportunities”
“The use of small amounts of capital from
a large number of individuals to finance a
new business venture.”
Crowdfunding has the potential to
increase entrepreneurship by expanding
the pool of investors from whom funds
can be raised beyond the traditional circle
of owners, relatives and venture
capitalists.
)
*
$
GoFundMe.com
Donations
Kickstarter / Indiegogo
Rewards & Product Validation
Social capital > Marketing
Word of Mouth Marketing
+
Prosper, Lending Club
Peer-to-Peer Lending
⋆
Realty Mogul, Patch of Land,
Carlton, CBRE
Equity / Debt
(

(
Regional Share 2014 6
$3.2
Billion
LendInvest, UK RE in
the UK,($240m)
$9.4
Billion
145% Growth
$3.4
BillioN
320% GrowthEU
N. America
Asia

7
The Global Aggregate-
.
~270,000 Jobs
Fundable
-
$96 Billion
by 2025
World Bank 2013
$200B
$6.1 - $16 - $34.4
North America retains first place
Lending: $11B
$0B
$1.75B
$3.5B
$5.25B
$7B
Art
Publishing
M
usic
&
RecordingScience
&
Tech
Property
Film
&
Perform
ing
ArtsSocialCauses
Business/
Entre
2013 2014
Source economist / Massolution

Title 3
ETA: January
Title 4 / Reg A+
Bankroll & Many Others ()
8
The Regulatory Rollout(
/
0
$
1
Revenue equivalent crowdfunding
No Guarantees
Mini IPO
Seed (vs Angel) Round
Investor Limits No Funds
Test the Waters
(Then only go Tier II)
Unlimited Raises
Limited Population
Psychological Friction to Invest
General Solicitation & Advertising
Rules in Rule 506 & 144A
SPV’s for CF on Cap Table
REAL Crowdfunding
$5MM Limit
Investor Limits 100K
No Funds
Test the Waters
Title 2
Angel List, Gust, Patch of Land
Carlton Group
Perks / Donations / Pre Sales
Kickstarter, Indiegogo, gofundme

Better deal economics
Solicitation + Marketing & PR
Transparent = Higher Returns
Streamline Online
24/7 Fundraising
STRENGTHS
Regular Accreditation
The Psychological Friction to invest
WEAKNESSES
Mortgage
Institutional
Secondary Markets
OPPORTUNITIES
Proposed Rules revise Accredited
investor to $500K and $2.5MM
shrinks population 75%+
THREATS
9
Title II Of the Jobs Act2
-No limits on Raises
-No Per Investor Limits
-General Solicitation
-Low Cost
-Exempt State Registration
-Up to 2000 Accredited Investors
-No Audited Financial Status
-Investor Verification
-Requires Bad Actor Check
-No Ongoing Reporting
-No PreSale Approval
-Limited Population
-General Solicitation & Advertising
Rules in Rule 506 & 144A
-SPV’s for CF on Cap Table
-Available to Foreign Issuers
Overview
%

10
Intrastate3
4
5
+
6
majority exclude and may include RE
Holding / Development Companies
“Investment Company” Exclusion
Varies, but most are $1MM and
$2MM with audited Financials.
Caps & Financial Audits
Geographical and income-based
investment limits
Investor Restrictions
Ensure Business Portal, escrow
provider are also intrastate
Authorized or Chartered Vendors
As of August of 2015, twenty-nine (29) states have either enacted separate
intrastate crowdfunding exemptions, or have enacted amendments to their existing
blue sky laws to permit some type of intrastate crowdfunding.
Source: CrowdfundingLegalHub.com / crowdfundinsider.com
Proposed
Enacted
Rejected

11
Reg A+ The Mini IPO(
1
2
Tier 1
-$20MM Max
-Any Investor @ 10% of Income
-No Audits
-Blue Sky Applies
-No State Override
“If you need non-accredited
investors and live in a
state with intrastate
Crowdfunding, think about
that.” -Mark Roderick
-$50MM Max
-Any Investor @ 10% of Income
-2 Years Audited Financials
-$75k+ $20k Ongoing
-6+ Months to File
-Pre-Empt State Oversight
-Different Investors P/Asset
-Investors on Cap Table
(No SPV intermediaries)
Tier 2

12
Title 3…What Matters?(
• Attention to Business Model Viability
• Max of $1 MM p/year > $5MM
• Investor max (per issuer) $100,000
• Issuers aren't required to file tax returns, but must disclose specific info from their returns
• Provide optional Q&A format that issuers could use in disclosures
• Audited financial statements + review by an independent accountant auditor > First time would be
permitted to provide review rather than audited financial statements
• Information about officers and directors as well as 20%+ owners
• Required to file an annual report with the commission and provide it to investors
• Curation

13
Title 3 - Company(
Musts
•U.S.-based
•No disqualificaoon under Regulaoon Crowdfunding
•No companies that failed to comply with the annual reporong requirements during two years preceding
•Specific business plan, or must have indicated that the business plan is to engage in a merger or acquisioon with an unidenofied
company or companies (no blank check companies)
•A company can conduct its offering exclusively through one intermediary plaqorm at a ome
•Max of $1 MM p/year > $5MM
•Investor max (per issuer) $100,000
Disclosure Requirements
•A descripoon of the business and the use of proceeds from the offering
•Price and pricing method of the securioes and the targeted offering price
•Audited financial statements + review by an independent accountant auditor
•A company offering more than $500,000 - $1 million for the first ome would be permired to provide reviewed rather than audited
financial statements
•Informaoon about officers and directors as well as 20%+ owners
•Required to file an annual report with the commission and provide it to investors

14
Title 3 - Investor(
Individual investors may, over a 12-month period, can invest in the aggregate across all crowdfunding oﬀerings up to:
•If income / NW is less than $100,000, than the greater of: $2,000 or 5 percent of the lesser of their annual income or net worth.
•If both annual income and net worth are equal to or more than $100K, 10 percent of the lesser.
•Securioes may not be resold for one year.
•Holders of these securioes would not count toward the threshold that requires a company to register its securioes under Exchange Act
Secoon 12(g) if the company is current in its annual reporong obligaoons, retains the services of a registered transfer agent, and has
less than $25 million in total assets as of the end of its most recently completed ﬁscal year.
•All transacoons relying on the new rules would be required to take place through an SEC-registered intermediary, either a broker-dealer
or a funding plaqorm.
• Take measures to reduce the risk of fraud, including having a reasonable basis for believing that a company complies with Regulaoon
Crowdfunding and that the company has established means to keep accurate records of securioes holders.
•Investor max per issuer $100,000.

15
Title 3 - Platforms(
•Must register with the commission & become a member of a naoonal securioes associaoon (currently, FINRA).
•One intermediary plaqorm at a ome.
•Provide investors with educaoonal materials for the process for invesong on the plaqorm, and the types of securioes being offered and
informaoon a company must provide to investors, resale restricoons, and investment limits.
•Take certain measures to reduce the risk of fraud, including having a reasonable basis for believing that a company complies with
Regulaoon Crowdfunding and that the company has established means to keep accurate records of securioes holders.
•Offer company disclosures to the public 21 days prior to the raise and throughout the offering period.
•Provide communicaoon channels to permit discussions about offerings on the plaqorm.
•Provide disclosure to investors about the compensaoon the intermediary receives.
•Accept an investment commitment from an investor only ater that investor has opened an account.
•Have a reasonable basis for believing an investor complies with the investment limitaoons.
•Provide investors nooces once they have made investment commitments and confirmaoons at or before compleoon of a transacoon.
•Comply with maintenance and transmission of funds requirements.
The rules also would prohibit intermediaries from engaging in certain acCviCes, such as:
•Providing access to companies that have a reasonable basis for believing there is potenoal for fraud or other investor protecoon
concerns.
•Having a financial interest in a company that is offering or selling securioes on its plaqorm unless the financial interest is compensaoon
for the services.
•Compensaong any person for providing the intermediary with personally idenofiable informaoon of any investor or potenoal investor.
•Funding plaqorms would also be prohibited from providing investment advice or making recommendaoons.

16
Example Campaign Rollout2
/0 1 1 7 8
Hire an accounong firm and
securioes lawyer to prepare
financial statements /
offering docs. Review & prep
contacts.
Offering Prep
Get a team with verified industry
connections to offering. Create
draft media, video, & promotion
strategy.
Hire Industry + Financial PR Firm
Update Site, Social, Landing
Pages, Prep PPC + Paid
Promotion.
Prep Digital Presence
Draft the script and campaign
digital assets, video, & two
rounds of feedback from
target investor audience.
Build Assets & Get Feedback
Choose a partner with existing
accredited investor base, verify bad
actor checks, upload tools & verify
accreditation.
Select Platform
Secure pre-launch investor
commitments and ongoing
campaign press opportunities.
Pre-funding Outreach
Crack the Crowd does not engage in the offer, sale or transfer of securities and securities may not be offered, sold or transferred via our team or affiliated business contractors. Securities may not be offered or sold in the United States absent (i) registration under the U.S. Securities Act of 1933, as
amended (the Securities Act) or (ii) an available exemption from registration under the Securities Act. Please consult legal counsel in the appropriate jurisdiction before offering, selling or buying securities as registration under the Securities Act or similar state legislation. Crack the Crowd is not
guaranteeing any information as reliable or accurate, and that it's subject to change at anytime. Please consult with your own attorney before engaging in any equity crowdfunding activity.

2015
17
Predictions9
: ; < =
Real estate crowdfunding expands
to over $2.5B, a 250% increase over
2014 and 2013’s 156% growth.
(Massolution)
Mortgage players e.g., SOFI
($1T market) enter the space and
disrupt beyond a $2.5B estimate.
Title III makes new “equity”
mortgages interesting.
Title III arrives, estimates are
revised further upward. Reg A+
lies largely untouched.
Jeb, Hillary, adopt Title III fixes
as a part of their platform.
Dozens of CFPs launch. Dozens, that
never had a chance, fail. Single issuer
platforms fragment the market
further. Strategic players invest.

???
18
9
<>=
Multi-family and rehab offerings,
again largely in the US, will see
moderate growth of up to 150% for
the coming year, with most projects
amounting to less than $500,000.
Cum sociis natoque penatibus et magnis dis
parturient montes, nascetur ridiculus mus.
Commercial remains the darling
of institutional investments;
greater adoption & viable
investors drive real estate.
Predictions

(
Paths to Market
19
Single Issuer ButtonBuild White Label

(
Platform 20

21
What They’re Saying(
“Crack the Crowd has produced some of the best crowdfunding strategy I’ve seen.”
— Richard Swart, PHD, Scholar-in-Residence at UC Berkeley, Author, Crowdfunding Thought-
leader
“I can’t tell you how much time this has saved me in research...Thanks for some very
concrete content in this space!”
— Shad Vick - Chief Software Architect, Lunasoft
“Their ability to create and identify a solid business strategy, regardless of the industry, is second to
none. Whether in need of pitch coaching, business strategy, crowdfunding campaigns, or all of the
above; Crack the Crowd is essential to your brand’s success.”
— Frank Day - Founder, Krma Golf
"Crack The Crowd solves the biggest problem crowd ﬁnance platforms face today: how to
become relevant. Through applied analytics and a network of marketing professionals,
CTC helps to let your platform stand tall among your peers.
— Colton Riley - Executive Vice President, Tieback Realty Finance

22
Our Partners In Crowdfunding4
Our network has unrivaled access to crowdfunding’s best, which enables us to pair you with a dedicated portfolio of companies that match
your needs, and enables you to take advantage of opportunities: technology, operations, media, and legal support.
Proven experts meet high-growth teams

23
Our Guiding Process: Lean &Strategic(
We’ll take full inventory of your existing tools to
avoid overlap. We’ll conduct a discovery, audience
segmentation, and review existing assets for your
offering.
Project Exploration & Discovery
We’ll ideate & rapidly prototype several concepts
within our team and gather feedback on several
possible strategies to create a plan that
incorporates the best elements of several
approaches.
Idea Generation & Strategic Plan
We’ll launch a controlled experiment to your
target audience, build statistically reliable
feedback (and refine), while selectively
seeding launch partner commitments.
Beta / Validation
We’ll help you launch using
proprietary crowdfunding and
traditional media methods with a
focus on key performance indicators
that scale & refine your operations.
Hard Launch / Scale
Tactics & Qualitative Validation
Working with your target audience, we’ll capture
qualitative data and compare several strategies
side by side to create a beta product and rollout
plan that incorporates the best of each concept,
and maximizes viability.
Review & refine Process

24
Integrated Marketing & CRM Configuration(
4 Conversion is critical, so our practical execution and data driven
approach minimizes waste and maximizes impact.
1 2
3 4
1
/5
Our creatives will create
targeted ads and closely
monitor your campaigns and
content in a practical six-
month package that includes
monthly course-corrections to
ensure efforts aren't wasted.
Creative and Campaign launch
We’ll fix data leaks and existing
flaws to mitigate any gaps in our
plan, and configure recurring
snapshots.
Configure & Align
After we establish
benchmarks, we’ll optimize
channels to lower your cost
per lead / customer, and scale
high-performing tactics.
Optimize and Scale
Review goals, existing
resources, and engagement to
customize strategy and tactics.
One size does not fit all.
Assess
$

25
White-Label & BRANDED Content+
There is no berer R.O.I. for a plaqorm than kickstarong a high-
quality campaign. We can build custom, beauoful, instrucoonal
materials to help your campaigns raise more, close more quickly,
and reduce customer support needs.
Branded content
Quick-Start Guides, Campaign Best Practices, White Papers, and more…

26
Case Study?
During the brieﬁng phase it was apparent that this was a
special project that would need a high-level of customizaoon.
CrowdEngine was already growing fast, and we were able to
accelerate growth and turn their vision into reality, on ome
and on budget. We built the brand, markeong plan, site copy
and design revisions that elevated their percepoon from one
of many, to the premier provider of white label sotware
soluoons in the space.
Crowdengine
White Label Crowdfunding Software

(
Campaign A La Carte Services 27
5
+
4
2
@
A
Our team has launched millions of dollars worth of
innovation. We know the techniques to capture and
engage users.
Product Generation & Refinement
There is no need for guesswork when it comes to
setting a target raise or rewards price. Our strategy
will get you realistic targets and often higher margins.
Pricing and Raise Target Analysis Services
We work bootcamp-style to get as much work done
in a single session as possible. You’ll learn what
matters and how to execute as quickly as possible.
1-on-1 Campaign Consulting and Advisory Services
Save hundreds of hours. We’ll help you through the
first 80% of your work so you can launch faster
without compromising quality.
Outreach, Tools, and Templates
With teams and partners that can cover everything
from research, prototyping, to email marketing, we
can simplify the campaign dramatically.
Implementation: Fulfillment & Support
Ask any crowdfunder, it’s no where near as easy as it
looks. If your campaign has already launched and
needs a boost, we can help to get it back on track.
Launch Revival

28
Marketing Strategies & Plans(
Awareness
Consideration
Preference
Purchase
Partner / Re-up
Email
SEO/SEM
Inbound
Social
PPC/Ads
Different channels will outperform others in
different stages of your conversion funnel. By
mapping each through our integrated
marketing system, we’ll optimize and scale
your marketing mechanisms to get you the
best bang for your buck.

Content and social media
planning over 5 sessions
Six Month Strategy
29
Unknown to Influencer
Six Month Content and Social Strategy
4
%
:
2 B
C
D
Works with you one-on-one
to customize your plan
A dedicated content expert
Engage with strategically
developed content
Targeted messages
Periodic check-ins ensure you
focus on what works
Monitoring & Alerts
Execute yourself or have
our team manage for you
D.I.Y. & Pro Options
Content blueprints simplify
the creative process
Templates & Packages
What could you do with a thousand more brains working for you? With Unknown to Influencer, you’ll get
the roadmap that makes sense of social marketing so you can focus your time on what matters. Learn: how,
who, and what matters, build clout, and engage your audience.

"
1387 E 3010 S Salt Lake City, UT
+1 (801) 316 - 3564
! '# E info@CrackTheCrowd.com/CracktheCrowd@crackthecrowd/CracktheCrowd
Go Ahead, Ask Us Anything.
Office, Social Media and e-Mail

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