What is equity-based crowdfunding?

Equity crowdfunding (also known as crowd-investing or investment crowdfunding) is a method of raising capital used by startups. Each investor is entitled to a stake in the company proportional to their investment.

What are the different types of equity crowdfunding?

There are essentially three kinds of crowdfunding: reward-based, donation-based and equity-based.

Can you make money from equity crowdfunding?

Equity crowdfunding involves exchanging relatively small amounts of cash allowing investors to own a proportionate slice of equity in the business. A business capitalized through equity crowdfunding can run the risk of failure, fraud, or may take years for profits to be realized.

Is equity-based crowdfunding regulated?

Regulated crowdfunding is also an equity-based crowdfunding platform and it provides investors with a financial return, but the difference is the U.S. Securities and Exchange Commission (SEC) regulates it.

What is equity-based?

used to describe something that is connected to the value of shares in a company: equity-based funding/investments/products.

Is Kickstarter registered with the SEC?

This page includes all SEC registration details as well as a list of all documents (S-1, Prospectus, Current Reports, 8-K, 10K, Annual Reports) filed by Kickstarter, Inc…..SEC CIK #0001481000.

Is crowdfunding a debt or equity?

There are two types of investment crowdfunding models – p2p lending and crowd investing. The main distinction lies in the models’ core. P2P loans are debt-based while the heart of investment crowdfunding is equity.

How do equity holders get paid?

There are two ways to make money from owning shares of stock: dividends and capital appreciation. Dividends are cash distributions of company profits. Capital appreciation is the increase in the share price itself. If you sell a share to someone for $10, and the stock is later worth $11, the shareholder has made $1.