Adam Torres and Gene Massey discuss marketing investment offerings.
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Show Notes:
Why are more companies raising capital online instead of going to angels and VC’s? In this episode, Adam Torres and Gene Massey, Chairman & CEO at MediaShares, explore the current state of marketing investment offerings online.
About Gene Massey
Gene Massey, CEO of MediaShares and a regular speaker at Wall Street and Fintech conferences, advise companies on the new and innovative methods for raising capital online through equity crowdfunding. As a consultant to issuers seeking funding, Gene applies MediaShares’ unique marketing methodology, systems, and software to help them get funding for their public offerings online, using Regulation D, Regulation CF, and Regulation A+. In addition to advising companies on how to maximize their fundraising on Equity Crowdfunding platforms, Gene also supervises the creation of their story on their own website landing page. Introduce clients directly to investors, and to FINRA brokers that can bring investors to their offering.
If a company already has a marketing firm, MediaShares can oversee their campaign and create the marketing content and craft their story for investors. They have an email list of 200,000 potential investors, both accredited and non-accredited. For public companies needing additional funding, MediaShares also has access to accredited private investors for registered follow-on offerings.
In the past Gene have occasionally worked as a Corporate Secretary and Board Member for companies, and in that capacity would often help with their corporate governance and oversee their filings and Board actions. This can often be a weak spot for many early stage companies.
For many years Gene was a Director of TV commercials for numerous major advertisers. Directed many celebrities and I’m still a member of the Director’s Guild of America. Directing TV commercials taught Gene a lot about telling a story in 30 seconds, and this experience also helps in crafting an issuer’s story for raising capital, and in creating great videos for their marketing campaign.
About MediaShares
MediaShares is a marketing and funding consultancy that helps companies prepare and implement their investment offerings on equity crowdfunding platforms. They help client companies use SEC rules Regulation CF or Regulation A+ for equity crowdfunding investment offerings to get the funding they need to grow. They have long-time relationships with all the major platforms and can make personal introductions to them. In special cases they can also help market a Regulation CF or Regulation A+ offering when on a company’s own web page.
MediaShares has relationships with private equity firms, angel groups, venture capital firms, FINRA-licensed brokerages and high-net-worth individual investors. When a MediaShares client has a suitable investment offering, we often make appropriate introductions to these capital sources.
MediaShares makes introductions to securities attorneys, accountants, and marketing firms to help their clients with their offerings and always pass along their negotiated discounts. They never take success fees, instead charging a monthly retainer for their consulting services.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show, just head on over to missionmatters. com and click on be our guest to apply. All right. So today’s guest is Gene Massey and he’s chairman and CEO over at MediaShares.
Gene, welcome to the show. Thank you, Adam. right, Gene, so we got a lot to talk about, but first off, hey, so you’re going to the upcoming conference, am I right there? the Reg A conference, yes? Yes, they’ve actually made it bigger this year. There are two things , in online fundraising called Regulation CF and Regulation A, and those are two SEC exemptions for being able to raise money online.
Both of them will allow you to raise money from non accredited investors. And so this year they added reg CF to their usual reg a conference. And let me tell you, it’s going to be a huge event on June the 20th at the Westchester Country Club in New York. And they’ve all the big players in the business are going to be their brokers, marketing companies, and this year they’ve done something unique in that they are adding companies that are raising capital.
The companies that are raising capital get to come for free. And so they’re going to have all of these people there that are raising capital. The nice thing about their is that it’s very educational. So if anyone wanted to know about raising capital online, that is definitely the place to go. And I think , you’re also a speaker, right?
Correct me if I’m wrong. You’re also going to be. You know, I’ll be speaking moderating a panel on marketing secrets because you can basically exchange the word crowdfunding for marketing because that’s really what it is. You post your offering on a platform or even on your own website now, and you have to market it to people.
I, you have to get investors to come to your page in order to invest. So it requires tremendous marketing expertise and expense to drive the traffic of investors to your page where they can invest. so it’s, marketing , is the key. So my panel is on. Success secrets.
And basically there are many companies out there that are getting money on their offerings. You post your offering on a platform like we fund or restart engine or Republic or net capital, and you get a certain amount of money. Some of these companies have get are getting, , millions of dollars.
And so everybody wants to know, well, how did you get that money? And so I put a panel together of four different companies that are going to talk about how they got their money. There’s one company that spent 400, 000 to only get a million. And there’s one company . That got two million and didn’t spend any money.
And so you get to hear the secrets of how people got their funding online. And that’s what everybody wants to know. You know, , if you’re ever driving past these mansions, you know, in Beverly Hills, don’t you want to know , how did they get their money? I know, I know, I do. Mm hmm.
Yeah, that’s funny that you share that story. You almost want to go ahead and say, excuse me, excuse me ma’am. Can you tell me how you got your money? Oh my gosh, that’s funny gene. So So anyway on crowdfunding everybody wants to know so you got five million really how’d you do it? So we got a pedal. Yeah.
Yeah That’s amazing. I you remind me of a story. I, I quick tangent. So I remember when I first moved to California, I moved to Pasadena and I didn’t know anything about California really. Like that wasn’t, I’m from Michigan originally. I lived in before that and in Scottsdale, but I, I moved you know, Pasadena and I don’t go too many places.
I was studying for my CFP. like years ago. And so I didn’t really go out much or do anything much. So I was literally just in Pasadena studying for my CFP and that was it. And I remember I accepted a promotion for the company I was at the time. I mean, I haven’t managed money, you know, I’ve been doing this for over eight years, full time in media, but back then I got a promotion to Century City and I remember the to another office.
And I remember the first time I got off the freeway, And I started driving through like the big area in Beverly Hills and I’m like, I, I moved to Beverly Hills, but I was in the little area, you know, the poor side of Beverly Hills. But I remember the first time I went through all those houses and I’m like, Whoa, I had that exact feeling that you just said.
I was like, how do I, I felt like knocking on the door. But that’s amazing. I had to throw that out there. Random story, random tangent. What does it have to do with the upcoming conference? Nothing. Well, you know, we live in Brentwood. don’t live in a mansion. But we live in Brentwood. And we drive by all these mansions all the time.
And I was asking my wife the other day, we just go up and knock on one of these doors and ask them how they get their money? Oh, that’s amazing. But speaking of money, that’s what we’re talking about here, is being able to get your money online. You know, for years, companies got their money from venture capitalists.
And from angel groups and, and we, we make a joke now that saying go going to a venture capitalist office and looking for money is like going door to door vacuum cleaners. You don’t need to do that anymore. Now everything is online. And of course, venture capitalists don’t like crowdfunding. , so it’s a different world now.
A lot of money is being raised online. What do you think that does for the investor? Like just from your, I mean, you’ve been in this business a bit, like for investors and just having them having different access to different opportunities, like versus, you know, maybe some things in the past. Well and even today, if you go to a venture capitalist and you want to get a million dollars for your startup and they love it, they think, you know what?
You’re a good guy. You’ve got a Ph. D. from M. I. T. and you come up with this time machine, and , we’ve tried it. We’ve seen people going back to 1850 and coming back and telling all about what was like in 1850. So then, so they’ve got proof of concept that their time machine works, and they know that, If it really works, you’re going to make a billion dollars.
You know, this is everybody’s going to want to go back in time and see their old girlfriend when she looked good, you know, and, and so, well, guess what? Even if it’s a fabulous deal. And you’re really smart. You’ve got your PhD from MIT and you invented this time machine and they all love it and they love you and your other team members and you want a million dollars.
Okay. We’re going to want 30 percent of your business. And you go, what? Really 30%. You want a third of the business for a little million dollars, even though it’s gonna be a billion dollar company. It’s like they say, yeah, but , we don’t know. It’s gonna be a billion dollar company. I mean, , a hurricane , could come by and blow the machine away or something, , or you could fall down and break your neck.
And then we, where would we be then? So they want to give you a million dollars for 30%. It’s a big risk for them. So you go, you take your time machine. And you have testimonials of people that have gone back to 1850 and come back and they or and they met Abraham Lincoln and had a wonderful time and they came back to tell you all about it.
The time machine they’ve shot, they’ve proven that it actually works. And a couple of people have even paid to go back to 1850. So you now you have some revenues. And everything works. So what you do is you go post your offering on a platform. We fund our start engine net capital Republic.
, those are the top four. You post your offering one of those platforms and you tell everybody about it and you send out emails and you do Facebook and Instagram ads, and you do all kinds of promotions and webinars and make videos about it. From people and you’ve got all kinds of advisors from MIT that helps you make this time machine.
And everybody looks at it and they go, damn, that’s really something, a time machine that goes back to 1850. And so you go on there and you get 5 million for 5 percent of your company , or less. There was one company that had a that was on one of the platforms and they had a new way to make solar cells that would be.
that they could make them faster, cheaper, and they would actually produce. More electricity, they said, and they had MIT again, they had MIT advisors and you looked at the team and they looked really smart and they had all these videos of cutting laser cells and their silicon cells with lasers and big pictures of machines and everything.
And you thought, and they had all kinds of testimonials of smart people and they got 5 million. On a five on a 200 million valuation. Now, what that means is what’s the percentage of 5 million of 200 million. That’s pretty small. That’s far, that’s a long, a big difference between 30%, but they actually got 5, 000, 000 on a 200, 000, 000 valuation.
And I told some VC friends, they said, get out of my office, don’t ever come in here again. 5, 000, 000 on a valuation, get out of here. And so that is the big difference. Now that’s of course, an extreme exaggeration, but you can get a better valuation. One of the reasons for that is people that are investing most of the time, they’re putting in 250, 500, maybe a thousand, some people maybe put in 5, 000, if you’ve got a really good deal.
And they don’t know, most of them don’t know what the word valuation means, you know, it says 20 and, and they think if you’ve got a 20 million valuation, it must, the company must be a better company and they don’t realize they’re being diluted because, oh, it’s a 50 million company. Oh. And they want, they want a thousand dollars.
Okay. And , they think because the valuation says 50 million, then it must be. A bigger company and it’s not, it’s just more diluted. See, so anyway, I’m not, now I don’t mean to say , that crowdfunding investors are stupid. I’m just saying they’re not risking a million dollars. And so they know that.
And most of the time it’s something that’s really cool, like a flying motorcycle or something, , that’s every, you look at it and you go, , , and the motorcycle really flies by God, look at that, you know? And so you look at something on one of these platforms. And you go, wow, that’s going to make money,
and so you put in 500, , it’s not the end of the world if you don’t get your 500 back, but a venture capitalist has to answer to his limited partners and if he loses a million dollars, he’s got, you know, he’s, he’s going to be in trouble. So for sure, angels and venture capitalists.
When they invest as they have for many years, and they still are, of course, if you need a lot of money, if you need 30 million or 50 or a hundred million dollars, , then it’s a different deal , with regulation CF. You can raise up to 5 million from non accredited investors with regulation a, you can raise up to 75 million.
Now there’s one advantage to regulation a, when you’re raising up to 75 million is that you can also go public with it. You can also list on NASDAQ. And that’s a real plus because most investors want to know three things. Number one, how do I not lose my money? How do I know for sure that you’re not going to lose this investment that I’m going to give you?
Okay. , number two. I’m going to give you this money. How do I know that I’m going to get a multiple back? Because you’re a startup, , you know, you guys are new , and who knows, this is not a veteran, this is not general electric I’m investing in. This is a couple of young guys in the garage, so I’m gonna give you some money.
So how do I know if it’s successful, that I’m going to get a multiple of my money back? I’m exchanging the risk for a multiple return. And then the third thing every investor wants to know is. How do I know when I’m going to get my money back? And so if you tell investors up front, we’re planning an IPO and within the year, we’re going to have a listing.
Oh, Oh, you’re going to do an IPO. Yeah. Not only that, but we will sell you shares at a discount to the IPO price. Oh, well, how does that work? Well, you buy a share now you can exchange it later. For a discount of 30 percent to the offering price. So you can actually appeal more. It’s more appealing to investors if they know there’s going to be an exit.
And unfortunately, in crowdfunding right now, they’re, most of the, the majority of the investments are having trouble with an exit. And they all say, you know, two things, you can either, you’re either going to get the company acquired, or you’re going to go public. Those are, those are the two big ways. That you’re going to get your money back.
We’re going to sell the company and a big pharmaceutical company like Merck, they’re going to buy us because we’ve got this new drug. Oh, okay. Or we’re going to go public one of those two ways. And unfortunately a lot of the crowdfunding offerings. Now, I have not seen a lot of them going public there.
A lot of them, they get the money. , and , , they’re not doing well. Sometimes they don’t do well, you know, startup business , a lot of them fail and that’s a huge problem , in the business world that are , early stage companies. I’ve known a lot of entrepreneurs that really shouldn’t have been an entrepreneur.
They shouldn’t be working for somebody else. They really shouldn’t be. So it’s risky. Yeah, it is risky. And I’ll just say first off, this has been a great conversation just learning more about, and I mean, I know you’re going to go into much more on the moderating the panel and then speaking in the conferences all about this.
But , that being said, we’re about out of time for today’s episode. If somebody wants to keep the conversation going how do people connect and how do they learn more about MediaShares? Well Mediashares. com. is a website, and you can go there and very easily connect with me there. I’m also on LinkedIn, Gene Massey on LinkedIn.
You can connect with me there. We are primarily a company that markets these offerings. Sometimes we supervise other marketing offerings. Companies, they’ve already got a marketing company. We will very often start. marketing And sometimes we will do it directly for them. I was, for many years, a TV commercial director, so I’m pretty good at videos.
I’ve won a lot of awards from Clio and multiple tellies and New York festivals, stuff like that, so I’m pretty good video. And we, and every company needs a video. So that’s something , we shine at, I think, but media shares. com is the company and I cannot tell you how grateful I am to be able to talk to you, Adam.
It’s really great. I love what you’re doing. It’s, it’s very, very much needed in the world to hear from businessmen and hear all the new, the latest things. Yeah. Well, we’ll appreciate you making some time for us and the platform to come on. And for the audience, just so you know, , we’ll put the links and the show notes so you can go and check out media shares and go further into Gene’s company and also just, to consume some of their content as well as we continue to cover the Reg A and crowdfunding conference.
So big deal there. Speaking of the audience, if this is your first time with Mission Matters, this is a daily show. Each and every day we’re bringing you new interviews, new entrepreneurs, new executives, new ideas. Hit that subscribe button. We don’t want you to miss any of the upcoming episodes and we’ll catch you next time.
And Gene, again, thank you so much for coming on. Thank you, Adam. Take good care now.