What is the JOBS Act?
JOBS stands for “Jump Start Our Businesses,” a new law enacted in 2012 and expanded several times since then.
Put simply the JOBS Act enables you to raise up to $50 million for your business or startup without the time, expense and red tape of going public (IPO).
Over 5,000 businesses have raised hundreds of millions through the JOBS Act in the last 10 years.
JOBS Act Rules
- You need to primarily raise money from Accredited Investors — those with over $1 million in net assets, not including their home, or who have $200,000 in annual income.
- Non-accredited investors can only be about 25% of all investors.
- You can use monies raised from JOBS Act marketing for virtually any legitimate business purpose, including product development, advertising, expansion, office rental, business expenses, inventory, etc.
JOBS Act Marketing
JOBS Act Marketing is a variant on direct marketing, that is, marketing in which you want a direct response from your target audience — in this case money.
Money raised can be repaid through private equity in your company or providing your products to investors.
For example, developers of a new high-tech suitcase that is motorized and follows you around the airport, offer early investors some of the first suitcases off the assembly line.
Keys for Marketing Success
The success of JOBS Act marketing is the same as for other direct marketing. The three major factors are 1) selecting the right target audience, 2) using the best methods to reach them, and
3) creating a series of effective marketing pieces.
- Right target audience: Basically Accredited Investors who have recently invested in similar ventures to yours.
- How to reach them: Crowd Funding, Email, direct mail, You Tube, radio, remarketing,
- Remarking: Internet technology now enables you to follow clients on the Internet and send them additional emails, banner ads and pop-up ads for your products and services over a period of months. Remarking can increase your response from prospects two to seven fold.