Success stories: Lagalene's crowdfunding campaign

Lagalene is a high natural and sustainable cosmetics startup that successfully carried out its second equity crowdfunding campaign in 2023, supported by Turbo Crowd.

Lagalene has been granted innovative startup status for devising psychotonic cosmetics, through the addition in cosmetics of scents that support the psyche and help combat anxiety and stress. The entire product range follows the principle of simplifying beauty routines by using a few cosmetics containing a few ingredients of the highest quality and is aimed at a genderless audience. The goal is to revolutionize skincare by making it simpler and combining physical and mental well-being.

As an innovative startup, the company is eligible for tax incentives for its investors.

After the first equity crowdfunding campaign, aimed mainly at professional investors and entrepreneurs, Lagalene decided to launch another, larger one to continue and accelerate the company's growth. Francesco Arculeo, the company's CEO, identified crowdfunding as the most suitable tool for an early stage startup, the one that could serve as a springboard to move to the next stages.

Before starting: doubts and fears

Every entrepreneur's fear before a crowdfunding campaign is that of not being able to find the right stakeholders who might be interested in the project or not being able to engage them sufficiently. For Lagalene, the fear of campaign failure coincided with the fear of failing to continue on the path designed for the project and wasting resources without a return.

The equity crowdfunding campaign, in fact, required a lot of energy and economic resources and time for the setup, with the construction of the scope of the operation in the shareholders' meeting, the mandatory notarial acts and the business plan, and for the preliminary phase, with the production of sponsorship materials and the construction of marketing and sales processes. All of this was to be reflected in the outcome of the campaign.

In the second phase just described, Turbo Crowd support came into play, which Lagalene requested to enhance and optimize lead generation activities and ensure that it identified and tapped its target audience of potential investors.

Before the campaign: strengths and weaknesses

The situation before the launch of this second campaign saw very good prospects for Lagalene, thanks to previous experience with another equity crowdfunding campaign. Doing multiple successive crowdfunding campaigns is a great advantage, because it allows you to make the most of the skills and knowledge you have acquired and to use the investor support from the first operation as a base and megaphone for the second one.

Here, then, are the strengths of Lagalene:

• Previous experience with crowdfunding mechanisms.
• Base of supporters of the first campaign.
• Customer database.
• Distinctive features aligned with current trends in the beauty industry (sustainability, gender neutrality, essentiality, naturalness).

There were few weaknesses:

• Market full of competitors.
• Some distinguishing features that are not immediate to communicate
• Low advertising budget advertising.

Equity crowdfunding Lagalene: strategy

Turbo Crowd's strategy for a successful crowdfunding campaign always starts with the precrowd, or pre-campaign phase, which was built and customized based on the needs and characteristics of Lagalene and its target audience. The latter included both other entrepreneurs in adjacent or overlapping industries, as well as customers of the brand or potential customers.

In this phase, the Lagalene team and the Turbo Crowd team worked side by side to test the software to be used for marketing and lead generation activities, define the advertising channels and budget, create graphic and copy materials for campaign communications, and build effective sales processes for managing negotiations with potential investors.

Thus, here are the solutions put in place:

• Concentration of advertising budget only on Facebook with very targeted targets.
• Lead generation on LinkedIn.
• Creating an editorial plan for Lagalene's social media.
• Creation of dedicated landing page in both Italian and English with form on which to convey interested people.
• Design of rewards to incentivize early bird investment.
• Setting up prioritized sales pipeline based on willingness to invest and proposed amount, with recurring activities scheduled to monitor negotiations.
• Setting up marketing automation actions prior to direct contact through emails, messages and calls.
• Involvement of contact databases already held by Lagalene.

As a result of these operations, during the precrowd phase Lagalene reached 90 percent expressions of interest in the investment: this is the indicator used by Turbo Crowd to understand when the time is right to actually open the crowdfunding campaign.

During the campaign, the goal was to convert all expressions of interest into investments in order to get the meter up immediately and activate the herd effect, while continuing in parallel with brand promotion and communication activities.

Some examples of the proposed rewards:

• discount on shares
• coupons
• gift card
• product samples
• invitation to events.

Lagalene equity crowdfunding: results

Campaign start: February 2023

End of campaign: June 2023

Goal: 100,000€

Raised: 100,000€

Investors have been both old and new customers of Lagalene as well as other stakeholders and entrepreneurs. Francesco Arculeo emphasized the importance of having established relationships with useful contacts, for example, entrepreneurs who deal with similar products and have provided valuable advice for selling in physical stores or people with useful tax knowledge. Professional relationships and supporters are the real wealth gained from equity crowdfunding-that's why we talk about smart money.