In a previous post, we listed the best real estate crowdfunding sites, so investors can focus on that mode of investment when putting their money in equity. Real estate normally requires larger amounts of investment and offers returns up to 20% per year, balanced by the low risk each venture represents.
Startup equity crowdfunding, however, is a different beast. In this mode of investment, returns are expected to be at least 100%, preferably more. They are riskier as well, which means the investor can lose all or most of the money invested.
The criteria chosen for the top picks we offer here is the same as those in real estate equity crowdfunding: media exposure, number of successful projects completed, inauguration date, and amount of projects available to invest.
Here are the winners:
While not focused exclusively in equity crowdfunding—Fundable offers traditional rewards-based crowdfunding as well—the team was able to deliver a pretty sound platform for entrepreneurs who want to sell equity of their startups.
Projects must be either rewards-based or equity. A combination of the two is not allowed in the site. Entrepreneurs must also commit $1,000 of their own capital to the project. That’s one way they qualify a specific venture.
Los Angeles-based Crowdfunder.com is one of the most important equity crowdfunding platforms because they have been one of the most active companies to support the JOBS Act.
They are the number one place to go for a number of entrepreneurs who want to rise high values for startups. It’s common to see projects raising more than $1 million in equity, some of them expansions of already established businesses.
The site distinguishes themselves from the competition by offering a high level of informational material, open to the public, both for entrepreneurs and investors alike.
We could not talk about equity crowdfunding for entrepreneurs without citing a platform in the UK, a country that embraced this mode of investment when the JOBS Act was still being proposed.
Seedrs has raised more than £100 million since their inauguration back in 2012. Curiously, Seedrs appeared on the market at the same time other US-based counterparts did.