Choosing the Right Equity Crowdfunding Portal: 5 Things to Look for
1. A Proven Track Record
Reduce your risk by asking portals questions like:
How much money was raised for similar projects?
What percentage of offers reached their funding goals?
How do you vet investors?
What fraud protections do you have in place?
What are your fees? How are they calculated?
2. A Clear Understanding of the Legal and Financial Requirements
Publicly soliciting investment for a privately-owned company triggers legal requirements. The last thing you want to do is be misled and think you have complied, only to end up facing fines from regulatory agencies.
Look for someone who has the experience to point you in the right direction, and a platform that ensures you’re disclosing the required information.
Laws are changing quickly as this industry matures. Make sure whoever you decide to work with is fully committed to tracking these changes and adjusting their portals accordingly.
3. Personalized Attention and an Emphasis on Quality Deal Flow
An emphasis on fewer offerings with more screening – something we promote at Equity Round – ensures every opportunity is of the highest quality. This instills confidence in investors because they know when they see a deal, they’re seeing something truly valuable and will often invest.
This also frees up more time for the portal to give you personal attention and guidance throughout the listing process, ensuring you get the funds you seek.
4. Value Add
What else will a platform do for you besides listing your offer?
Quality portals find creative ways to add value, ranging from developing pitch videos and campaigns, to marketing or offering access to a special group of investors.
Always be on the look out for tools to help you target investors in your industry, as investors often focus on industries in which they have personal experience. These value adds can make the difference between a successful campaign and an unsuccessful one.
Focus on portals with straightforward, intuitive interfaces. This will help you save time should you want to add information, make changes to your pitch desk, or even seek another round of funding in the future.