The Peer-to-Peer Effect: What Happens When Investors Start Marketing Your Raise for You
When investors share a Reg A+ campaign with their own networks, secondary reach can exceed the original paid placement. We observed this with a golf-industry issuer whose ads were shared so widely that the CEO reported needing half-time staff just to manage the comments. Companies that already have large audiences could, in principle, leverage that exposure directly to amplify their live raise.
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Quick Answer
Secondary peer-to-peer reach occurs when investors and prospects share a campaign. In one Reg A+ offering we supported, that sharing produced exposure described as off the charts and required dedicated community-management time. The same principle suggests that companies controlling their own large-scale content could route viewers straight to a live offering.
The GolfSuites Moment: When Secondary Reach Outruns Paid Reach
We helped a golf company, GolfSuites, with its Reg A+ offerings. Golf is a popular game. When the company’s ads ran, people shared them with their buddies in large numbers. The secondary exposure of the advertising was off the charts because people liked what the company was doing.
The CEO was both excited and upset about the number of comments generated by the shares. He said they needed someone half-time just to answer comments on the ads. That community-management demand is part of what made the moment notable.
Why Peer-to-Peer Reach Is the Ultimate Marketing
Paid placements start the process. What follows depends on whether people share it. In the GolfSuites case, the shares themselves created the larger exposure. We called that secondary reach the ultimate marketing: peer-to-peer marketing.
Related elements that support sharing include an offering page that shows ongoing activity (proof of life) and founder videos in which the speaker looks directly at the camera. Viewers often later feel they already know the CEO. Those elements increase the chance that someone will pass the campaign along.
The Cub Crafters Hypothetical: What Controlled Viral Exposure Could Enable
We assisted Cub Crafters with their Reg A+ offering. During the raise, Red Bull produced a stunt in which one of the company’s aircraft landed on and took off from the Burj AL Arab hotel helipad in Dubai. The resulting videos reached 1.6 billion views. Cub Crafters participated and benefited, but Red Bull kept control of the videos. As a result, there was no opportunity to place a QR code in those videos to promote the live raise.
Imagine a company that controlled the content and could add that QR code. Viewers could move directly from the hugely popular video to the offering. The same logic applies to any business that already owns large-scale media exposure.
Implications for Marketing Leads and CEOs: Evaluating Paid vs. Organic
Paid reach is the controllable starting point. Secondary reach, when content is shared, can become the larger force.. That force requires operational capacity to manage the resulting conversation. Companies that already control significant audiences have one additional option, as the Cub Crafters hypothetical illustrates.
The GolfSuites experience shows peer-to-peer marketing in practice. The Cub Crafters example shows what it could look like when the content owner also controls the call to action.
Frequently Asked Questions
What is peer-to-peer marketing in a Reg A+ raise?
It is the secondary reach created when investors or prospects share a campaign with their own networks; in the GolfSuites offering, that sharing produced exposure described as off the charts.
Why did the GolfSuites CEO need half-time staff?
The volume of comments generated by the organic shares was large enough that answering them required ongoing attention. Some comments were negative, which is expected.
What is the Cub Crafters QR-code idea?
Red Bull videos of a stunt during the Cub Crafters raise reached 1.6 billion views. Cub Crafters did not control the videos, so a QR code to the live offering could not be added. The suggestion is that a company controlling its own content could do so.
What operational lesson follows from the GolfSuites experience?
Successful secondary reach creates community-management work. Planning for that capacity treats peer-to-peer sharing as a real channel.
Closing
If you have questions about the dynamics described here, email [email protected].
If you have questions about the dynamics described here, email [email protected].
About the Author
Founder & CEO, Manhattan Street Capital
Rod Turner is the founder and CEO of Manhattan Street Capital, where he built the platform growth-stage companies use to run Regulation A+ raises online.
He previously helped build Symantec/Norton, Ashton Tate, MicroPort, and Knowledge Adventure, and built the venture capital firm Irvine Ventures, investing in companies including Bloom, Amyris, Ask Jeeves, and eASIC.
The commentary on this page reflects Rod's observations of what tends to work in online capital-raise marketing. It isn't legal, accounting, or investment advice.
Manhattan Street Capital is not a law firm, valuation service, underwriter, broker-dealer, or Title III crowdfunding portal, and does not engage in any activities requiring such registration. Manhattan Street Capital does not provide investment advice and does not structure transactions. Do not interpret any commentary from Manhattan Street Capital staff as a replacement for advice from qualified service providers in these professions. When Rod Turner provides commentary, it is based on his observations of what works and what does not from a marketing perspective in online offerings; he does not tell readers what to do, only what is most likely to be cost-effectively marketed online. All decisions about the terms of any offering are made by the companies making those offerings.
