Wefunder - Kaxlo - Equity Crowdfunding Portal Review
Wefunder
Equity Crowdfunding Portal Review
Wefunder is a crowdfunding service which connects startups with investors online. Using a provision in the 2012 JOBS Act which allows non sophisticated investors to invest in startups.

Min Investment:

$100

Security Type(s):

Debt, Convertible Note, SAFE, Equity

Website:

wefunder.com

Summary

Wefunder is one of the more active equity crowdfunding portals. They are diversified in many sectors, and were one of the first equity crowdfunding platforms on the scene. Founded by Nick Tommarello, and a growing team of 50+ employees, including CTO Greg Belote.

One of the most inspiring aspects is their committment to their goals and manifesto, in which they have had employees sign on their website. The highlights of their goals are below.

 

Goals:

  • Give everyone the opportunity to invest in startups.
  • Connect startup founders with hundreds of evangelists.
  • Direct more capital to deserving businesses.

Guiding Principles

  • Quality, not quantity.
  • Investors come first.
  • Intense devotion to detail.
  • Markets make better decisions.
  • Seed investing is not only about returns.
  • If investors do poorly, then so should we.
  • Investments are open to those who care the most. 

Incentives and Promotions

As many other crowdfunding portals there is a referral bonus. You can earn $1000 each time a company you invite launches a fundraising campaign. Additionally, the startup you refer gets a 10% discount and pays $0 up-front

To receive the $1000 payment. The startup must launch on Wefunder, file a form C with SEC, and pass due diligence. It won’t be an instant payment as it often takes 3 to 6 weeks for a startup to prepare a fundraising campaign.

Earnings & Data

Wefunder has seen consistent growth, and has nearly doubled their investment volume from previous year. While there have been numerous success stories of individuals raising money, it’s still a bit too early to judge portfolio performance and evaluate exits. Our team will be diving in to identify winners and losers. Stay tuned!

Compensation

Wefunder Portal charges transaction based fees calculated as a percentage of the entire fundraising round of offerings. Prior to each offering it is determined what percentage of transaction based fee will be paid by investors and what percentage will be paid by the startup.

Furthermore there is an option to cap investor fees at a certain dollar amount, or further more can waive fees for certain startups or investors.

One interesting pricing model is they may also take an equity position in a startup in return for reducing the startups fees. In most cases we believe that it would be financially best for the startup to pay the fee’s in cash rather than equity, however we do like how this would align both the startup and Wefunder for success.

As with any business the fees go to running operations, including salaries and wages for employees, but it is noted that wages are not transaction based compensation.

Details

Accredited Investor Requirements:

No

Sectors/Industries:

Media, Eccomerece, AI/ Machine Learning, Retail, Technology, Hospitality

Portal Location:

United States

Portal Type:

Equity Crowdfunding

SEC CIK#:

0001670254
Wefunder Social Media:

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