FAQ

Before Investing

Before I Invest

What type of companies should I invest in?

Invest in a startup because you love their product or service, not just for potential profit or return.

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Understand that startups change plans constantly

They don’t need your permission to do so. Plans and forecasts are not predictions of the future.

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Review disclosures

Pay close attention to any disclosed dealings between the company and its officers, directors, employees or founders.

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Ask questions

Review and participate in the discussion forum for each offering you are interested in.

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Past performance does not predict future success

Just because a founder had success with a prior company, doesn’t mean she will succeed with the current one.

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Research

Do your own research. Read the documents provided by each company you plan on investing in. Get independent legal, accounting, financial advice. If you have any questions or need more information, ask the company.

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Cancellation

You can cancel your investment up to 48 hours before the deal deadline. After that, your investment will be final, and you will not be able to get your money back.

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Our Website

Our Website

What is CrowdFundingFinder and how does it work?

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What services does Crowdfunding Finder offer to Investors?

Our role is to facilitate crowdfunding by ensuring that Investors have access to all available information on each Offering to allow the Investors to do their own due diligence on an Offering and post questions, comments or concerns regarding an opportunity on the site. A discussion forum is provided for each Offering, facilitating discussion regarding the merits of the company.

Once an investment is made, Crowdfunding Finder’s network crowdfunding platforms will facilitate the documentation process to ensure that all Investors receive final executed documents related to the Investment. In addition, Crowdfunding Finder also provides educational materials and training to Investors.

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How is communication managed?

Our network crowdfunding platforms will manage all investor-relations communication between investors and companies after closing.

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What are some of the ways that an individual investor may conduct due diligence on a company prior to making a private equity investment?

It is important that an individual investor take the time to fully understand each investment he and or she may make via a crowdfunding platform. A company that offers securities through a crowdfunding platform must comply with specific disclosures and ongoing reporting requirements as mandated by the SEC.

The Form C that the Issuer files with the SEC as a requirement to offer securities using the crowdfunding exemption via a crowdfunding portal is available as a download in several places including the SEC Edgar data repository, the issuing company and the funding portal websites. The Form C filing will contain information on the issuing company. This mandated SEC filing includes required disclosures about the company, its business plan, financial condition, the securities being offered to investors and other essential information which the individual investor should carefully read, review and understand, including:

·      Company’s (issuer) name, legal status, mailing and email address

·      Names of Directors and Officers, as well as each person holding a beneficial interest of 20% of more of the shares of the issuer

·      A description of the business of the issuer and the anticipated business plan

·      A description of the financial condition of the issuer

·      A description of the stated purpose and intended use of proceeds from the offering

·      The target offering amount, the deadline to reach the target and regular updates about the progress of the offering

·      The price to the public of the securities or the method for determining the price

·      A description of the ownership and capital structure of the issuer, including:

  1. Terms of the securities being offered
  2. Each other class of securities
  3. Number of shares offered and outstanding
  4. Voting rights
  5. Any limitation to Voting Rights
  6. Summary of differences between offered securities and other classes

· The risks to purchasers

  1. Minority interest
  2. Corporate actions

·      Additional issuances

·      Share repurchases

·      Sale of issuer or assets

·      Transactions with related parties

  1. Name and ownership level of 20% beneficial owners
  2. Description on the restrictions on transfer of ownership
  3. How the securities being offered are being valued currently and may be valued in the future, including during subsequent corporate actions

·      Additional disclosures

  1. Registered Intermediary Name, SEC File Number and CRD#
  2. Compensation paid to the Registered Intermediary for conducting the offering, including the amount of any referral or other fees associated with the offering
  3. Certain legends in the offering statement, including the risks of investing in a crowdfunding transaction & required reporting

·      Current number of employees

·      Risk factors

·      Indebtedness

·      Prior exempt offerings, in any

·      Related party transactions, limited to those occurring since the beginning of the issuer’s last fiscal year, and only those that cumulatively exceed 5% of the aggregate capital raised during the preceding 12 months

·      Issuer to disclose the location on its website where investors can find the issuer’s Annual Report and the date by which the Report will be available

·      Disclosure to include any material information necessary in order to make the statements made, in light of circumstances under which they were made, not misleading

·      An Issuer must disclose whether it or any of its predecessors previously failed to comply with the ongoing reporting requirements of Regulation Crowdfunding

It is typically very difficult to forecast financial performance accurately for early stage private companies, and actual performance will often differ from the forecasts as disclosed in the company’s Form C filing. However, such forecasts can give a good indication of what the company perceives and represents its potential could be.

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What happens after I complete my investment?

After an investor completes an investment, funds are deposited into an escrow account with a third-party escrow agent. Crowdfunding Finder or our network crowdfunding portals do not have access to the investors’ funds at any time. All investor subscriptions are held with a third-party escrow agent in accordance with Regulation Crowdfunding.

 

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Will I be informed of any material changes in the offering before closing?

In the event that company makes a material change to the offering terms or information disclosed to you, you will be notified by our network crowdfunding portals and normally be given five business days to reconfirm your investment commitment. If you fail to confirm your investment commitment with the five-business day period, your investment commitment will automatically be refunded. The responsibility to notify you on a material change in the offering is on our network crowdfunding portals and not Crowdfunding Finder.

So, you should pay careful attention emails and notices you received from our network crowdfunding portals as well as the emails and notices you received from Crowdfunding Finder.

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How are our network crowdfunding portals different from traditional crowdfunding sites like Kickstarter and Indiegogo?

On our network crowdfunding portals, consumers purchase securities (including but not limited to equity, debt, and revenue participation notes) in privately held companies.

Crowdfunding sites like Kickstarter and Indiegogo allow people to donate money to campaigns in exchange for rewards. Once the backer receives the reward, the transaction is finished. The backer does not share in the company’s potential upside success and the company does not give up any portion of equity ownership to the crowd.

On our network crowdfunding portals, investors purchase securities in private companies. They do not receive rewards, they receive stock or another type of investment in private companies. If the company becomes successful, shareholders have the potential to receive a return on their initial investment.

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Does crowdfundingfinder.com recommend any investments?

Crowdfundingfinder.com or any of their affiliates; do NOT provide investment advice, or recommendations. You must make your own decision as to whether an invest in any company or project listed is right for you.

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Is there a minimum investment amount?

The terms of each investment are clearly displayed on that project’s main webpage. Minimum investment amounts may vary from one company or project to another.

 

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How will I know when new investment opportunities become available?

When new investment opportunities become available, crowdfundingfinder.com will send an email alert to its users. Further, you can receive updates by following crowdfundingfinder.com on Facebook, Twitter or LinkedIn.

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What is the real value of CrowdfundingFinder.com to investors?

Simple: ground-floor access to highly vetted deal flow that is typically unavailable to most retail investors in an environment that is reliable and confidential.

Additional Benefits:

  • Our community opinion in the form of our company success probability grade to support your own investment research efforts
  • Interactive search and benchmarking tools that allow you to compare deals and key metrics for crowdfunded investment opportunities across many platforms.
  • Online investment detail pages that simplifies the process of managing potential transactions.
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What is the typical investor profile?

There is no typical profile. Our accredited investors consist of family offices, venture capital firms, pension funds, individual accredited investors, other broker-dealers, registered investment providers, international groups, and other financial advisory organizations.

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How long does it take to complete the registration process?

Less than 10 minutes. Even with the use of third-party accreditation verification, registration can be completed same day.

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Are there any requirements to be an investor?

Some of our network crowdfunding platforms are required by regulation to validate the accredited status of each investor. Whether through a third-party validation service or a letterhead notice by your attorney/accountant/banker, each investor must demonstration of accreditation status prior to investing. It is a prerequisite for investment to certify your accreditation on the offerings that are limited to accredited investors. Many of our network crowdfunding platforms also requires sophistication and suitability: you should be familiar with investing and understand how to review a deal for merits and risks.

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Benefits of investing with Crowdfunding Finder

Benefits and Risks

What are the benefits of investing in private companies?

There are more high value companies staying private longer. Traditionally, only angel investors and venture capitalists had access to invest in these private companies, but now they’re publicly available on Crowdfunding Finder via our network crowdfunding platforms.

It’s not just about a potential financial return on investment. It’s about becoming part of a company that may change the world. Think about all the companies that have fundamentally changed our culture. Early stage venture capital investing means investing in ideas, entrepreneurs, and innovation. It means changing the way the world works, influencing people’s lives, and becoming an inextricable part of that story.

Via our network crowdfunding platforms, anyone can have access to those opportunities on an open, transparent online market on Crowdfunding Finder.

 

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Post Investment

Post Investment

What happens if a business fails?

As with any investment, there is an inherent risk that the company in which you invest may fail. If that is the case, and there is a liquidation event, holders of Preferred Stock will have a liquidation preference over common stock holders of the company. However, in many cases, there are no assets left to distribute, and the entirety of the investment may be lost.

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What happens to my share of ownership if the company issues new shares in future financing rounds?

As is the case with any equity financing round, companies will naturally be diluting the equity ownership of existing investors. That means your proportion of ownership will be reduced, unless you own Preferred stock and exercise your right to maintain proportionate ownership.

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What are follow-on or new funding rounds?

It is anticipated that due to the startup phase that most companies will be in while presenting offerings on crowdfunding platforms, most companies that raise money on a crowdfunding platform will likely need to raise further funding in future. If an existing investor does not participate in follow-on or new funding rounds that occur at a time in the future then his and or her percentage ownership of the company will be reduced.

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I changed my mind, can I update/cancel my investment?

Yes, you have up to 48 hours prior to the end of the offer period which is both posted on the website and included in the offering documents (Form C) to cancel your investment commitment. However, once the offering period is within 48 hours of ending, you will not be able to cancel for any reason even if you make your commitment during this period.

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I invested, what do I actually own?

When you invest in companies or projects, you’re buying equity interest in a real company setup. Investors in a company or project will own securities issued by the issuers only (the companies themselves). You are NOT buying equity interest in crowdfundingfinder.com or its network crowdfunding platforms.

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