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Diversification

October 10, 2018
Crowdfunding investing is highly speculative and every investment may result in a loss. By investing small amounts across multiple companies, you can reduce your risk compared to a large investment in a single company. 0

Valuation and capitalization

October 10, 2018
Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult. You risk overpaying for the equity stake you receive. The class of equity being sold via a crowdfunding offering may have fewer rights than other equity classes issued by a company. 0

Investment in personnel

October 10, 2018
An early-stage investment is also an investment in the founding entrepreneur(s) and/or management of the company. Being able to execute on the business plan is often an important factor determining whether the business will be viable and successful. You should also be aware that a portion of your investment may fund the compensation of the

Lack of professional guidance

October 10, 2018
Many successful companies partially attribute their early success to the guidance of professional early-stage investors (e.g. angel investors and venture capital firms). These investors often negotiate for seats on the company’s board of directors and play an important role through their resources, contacts and experience in assisting early-stage companies in executing on their business plans.

How do I calculate my net worth?

October 10, 2018
Calculating net worth involves adding up all your assets and subtracting all your liabilities. The resulting sum is your net worth. For purposes of crowdfunding, the value of your primary residence is not included in your net worth calculation. In addition, any mortgage or other loan on your home does not count as a liability

Past performance does not predict future success

October 10, 2018
Just because a founder had success with a prior company, doesn’t mean she will succeed with the current one. 0

Ask questions

October 10, 2018
Review and participate in the discussion forum for each offering you are interested in. 0

Review disclosures

October 10, 2018
Pay close attention to any disclosed dealings between the company and its officers, directors, employees or founders. 0

Understand that startups change plans constantly

October 10, 2018
They don’t need your permission to do so. Plans and forecasts are not predictions of the future. 0

What type of companies should I invest in?

October 10, 2018
Invest in a startup because you love their product or service, not just for potential profit or return. 0

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