The Ultimate Guide on How StartEngine works?

StartEngine helps startups raise money through crowdfunding. Crowdfunding is an easy way for startups to raise money from a large number of people. These large groups contribute their small individual investments to provide the capital needed to get a company to go public.

The Ins and Outs of How StartEngine Works

StartEngine is an equity-based company that provides opportunities for investors to invest and receive promises of stock, future shares, or other security issued by the company in exchange for capital. StartEngine’s investment spans a wide range of industries, from wear to mobile apps, to solar, to electric vehicles, and much more.

In StartEngine, numerous investors are invited to participate and contribute their share in raising a company. This is different from traditional fundraising, where companies seek capital from one or two major investors. StartEngine is primarily done online, and it boasts of a greater reach and higher turnover. It leverages social media and its website to bring investors and entrepreneurs together, therefore, expanding the pool of investors beyond the traditional circles of relatives, family members, and friends.

There are two options in terms of the types of equity crowdfunding available on the site. One is Regulation Crowdfunding, where a company can raise up to 5 million annually, and any investor interested can participate. The other option is the Regulation A offering, where a company can raise up to $75 million. However, the regulations are more burdensome compared to Regulation Crowdfunding.

Founders would create a campaign for their business via the platform’s website, and anyone who visits the website can invest. Also, every startup’s fundraising campaign should include the minimum investment amount, price per share, number of investors, company overview, valuation, and terms.

For now, you can only invest with an individual cash investment account. Although, the platform has plans to add IRAs, joint accounts, and trusts in the future.

StartEngine offers assistance both on the onboarding and investment side. At the beginning of the process, the company will give you an account manager to help with your offering before their compliance team reviews it.