SocialMedian Discovers a Totally New Way to Use Twitter for Business

We have already seen tons of things people do on Twitter to help their business - marketing people selling staff, community managers engaging in various activities with their users, startups providing technical support, bloggers hunting for scoops and promoting their articles. But Jason Goldberg, CEO of the recently launched to the public SocialMedian has found a new (and kind of unexpected) way to use Twitter for business: he is attempting to raise investment right within the microblogging service.

True, it is normally very easy to post a short message on Twitter for all your followers to see when you need something - a contact in a company you want to reach, an invite to a private beta of a service, a quick vote on Digg or whatever. And it looks like Jason has just decided to make the next logical step and asked on Twitter for what his company really needed - investment.

The amount of funding Jason is looking to raise is up to $500K (actually this is exactly what Social Median has already raised so this is going to double their total investment) with every interested investor to provide $25-$100 thousand each.

This gesture does look like a clever business idea first: looking for investors in the way that you can easier target them. Unfortunately, as Michael Arrington notes, this type of activity violates Securities Act of 1933. Right after Michael bothered to show Jason his mistake in public, the tweet was deleted and replaced by a new one:

But no matter how legal or illegal this approach to fundraising is, I think it should teach us all a lesson. While this whole web 2.0 business seems to be somewhat laidback and informal with the huge deals closed with both parties wearing jeans and drinking beer, there are situations when it actually is a real business - and fundraising is definitely one of them. And even if it may seem to be a good idea to simply announce that you want someone to invest in your company where the most people will hear, it will not hurt consulting a lawyer first - after all, half a million dollars is an amount definitely worth it.

Nevertheless, violating a regulation or two is not such a bad thing when you get quite a nice free publicity for your desire to raise money - after all, your intention gets huge coverage, you eventually raise money and success is rarely blamed.

Photo of the Wall Street bull by Sylvain Leprovost used under Creative Commons.