Equity Crowd Funding
Hello!
I was wondering if anyone has tried equity crowd funding. I am currently using fundable
Are there any other good equity crowd websites?
Also I have garnered some interest in Rayton Solar on fundable
What are your thoughts?
There are plenty on real estate. Nextvesting is doing VC / PE co-investing with funds running the deals (www.nextvesting.com)
Equity-based crowd funding encompasses a wide and diverse spectrum. Most are primarily based on real estate transactions which can range from fix-and-flip (e.g. 12.5% return for investment in XYZ which wants to flip a home) to real estate developers wanting to finance the construction of a student housing complex in exchange for an equity stake in the project (this can also be a loan to the real estate firm).
Recently I've come across small business lending which is slightly different than pure equity deals however most (like my example I'm about to give) take out a lien which protects investments in that in case of a default they would effectively takeover the business and run it until investment is recouped for investors or they would liquidate and return cash to investors.
Examples of the above include Fundrise, Realty Shares, Crowdfunder, and Reamerge to name a few.
If you want to see how equity crowdfunding, P2P lending, etc compare to bonds and stocks Reamerge has an active blog which does some in depth analysis that you will find interesting:
http://blog.reamerge.com/
Let me know if you have any questions, exciting topic to explore IMO.
There are several equity crowdfunding platforms that you can list your pitch on, in Europe and beyond. Each of them allows founders to raise capital from the investors that are already registered on the platform, as well as from other members of the community interested in their product. However, great differences arise in terms of structure and degree of regulation, and it’s up to the founders to understand what platform can provide the right structure for them.
iAngels - Startup Equity CrowdFunding Platform allows you to invest in high tech startups alongside Israel's top angel investors under the same terms. The minimum investment is $5k.
Crowdfunding for a PE Fund (Originally Posted: 12/19/2016)
Hi all,
We are in the process of setting up platforms to raise funds from individual investors for a PE Fund. In this process we plan to work with Banks and Retail stores to allow individuals to commit capital at these outlets.
There are two things to note though that set us apart:
1) Our model is more focused on individual investors than institutions as we would like to give individuals access to high growth assets, hence there will be several thousands of LPs. 2) In Crowdfunding, we use both retail outlets & the actual online Platforms
What do you guys think, in terms of Risks, Regulation, Plausibility of business model, Potential for success etc?
I have a feeling it can be fun!!!
Sorry but have you thought this through for more than a few lunches with friends? Have you worked in PE before?
I could come up with a couple hundred questions in an hour or two but my first impression is that it's a terrible idea, and that's even if you've worked in PE before.
Thanks Texas, never worked in PE i am in an emerging market country in Botswana in Africa. Here there is no regulation on crowdfunding but it is treated as a Collective Investment Undertaking. Admin is not a problem since Unit Trusts also work this way?
The idea is to look invest in mining deal Botswana is one of the Best Diamond Producers in the world!Please send some more questions I'm sure this will really help. Other people are free to critique as well.
Go to www.investxdotcom they have a similar model!
are you located in southeast?
edit: nvm, I know a few former bankers based out of the southeast that are establishing something similar
Thanks Brosef where can i read more about them and how is their work diferent from my model?
Crowd Funding (Originally Posted: 12/15/2012)
It looks like crowd funding legislation is only going to get more and more relaxed.
I know a lot of companies are salivating at the idea of being able to raise money from non-accredited investors, but I can't see this ending well. Funding for startups has always been difficult, but the assumption was the the average accredited investor has the financial expertise to conduct reasonable due diligence.
The average worker, however, likely does not. I think there will be a spike in people giving their $500, 1,000, or 10,000 investment (which to them is a lot of money) and being very disappointed by the lack of liquidity (which no matter how much you tell them its a 5 year lockup, they'll be banging on your door in 3 months) and failures. Multiply this by millions of investors across North America and it could turn very ugly very fast.
I can only see this being bad for startups which actually have solid business models and have been able to raise difficult funding as the "good" startup will be replaced by the startup that has the most aggressive sales team.
Interested to hear WSO input.
If people don't know what they are doing they shouldn't play. I think solid start ups won't have an issue, they will still have access to VC/Traditional Angel/Growth PE, they will still get the smart money. It seems like if you are smart and circumspect the secondary market might be very interesting.
Interesting. Where are you tracking the progress on the legislation? I understand that all the regulations are supposed to be hammered out finally within the month?
I'm not directly tracking it, however, I work for a startup that is looking to exploit the lax rules and see cause for concern. Obama is pushing the jobs act forward with the intention of creating jobs by stimulating startups through ease of acquiring financing. I actually like the accredited investor hurdle requirement, because it limits the supply of funding which moves funding towards the best startups. I think we will see the amount of startup failures spike if/when the rules loosen, as a lot of startups don't market their offerings as risky as they should. An accredited investor, in my experience, can see the risks and know the questions to ask. A non-accred (in general) doesn't understand the risks, which is where I see a major issue if the flood gates open.
Crowd funding really should have a place in society but how can risk be quantified so information is more asymmetric? Perhaps caps on the amount that can be invested - say $500 That will limit exposure.
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