Crowdfund Investing For Dummies - by Sherwood Neiss & Jason W Best & Zak Cassady-Dorion (Paperback) (2024)

About the Book

Want to rise above the crowd in crowdfund investing? This guide walks you through this new investing experience, explaining how to plan and launch a campaign; how to manage the crowd after a campaign is successful; and how to work within the SEC's regulations at every stage.

Book Synopsis

The easy way to get started in crowdfund investing

Crowdfund investing (CFI) is going to be the next big thing on Wall Street. U.S. investment banks, brokerage houses, and law firms are gearing up for the creation and regulation of new financial products that will be available to the general public starting in early 2013. The introduction of these products will revolutionize the financing of small businesses and startups for these key reasons:

  • Entrepreneurs and small business owners, who have had difficulty obtaining capital through traditional means (such as bank loans and angel investors) in recent years, will have access to investors around the world through social media.
  • For the first time, investors (so-called unqualified investors) will be able to purchase an equity stake in a business or new investment vehicle.

The Securities and Exchange Commission (SEC) is overseeing the creation of online portals that will allow entrepreneurs and small investors to connect. When these portals go live in 2013, Crowdfund Investing For Dummies will be on the front line to educate business owners, other entrepreneurs, and investors alike.

Crowdfund Investing For Dummies will walk entrepreneurs and investors, like yourself, through this new investing experience, beginning with explaining how and why CFI developed and what the 2012 JOBS says about CFI.

Entrepreneurs will find out how much funding they can realistically raise through CFI; how to plan and launch a CFI campaign; how to manage the crowd after a campaign is successful; and how to work within the SEC's regulations at every stage.

Investors will discover: the benefits and risks of CFI;how much they can invest; how a CFI investment may fit into a broader investment portfolio; how to provide value to the business or project being funded; and how to bow out of an investment when the time is right.

Crowdfund Investing For Dummies is an indispensable resource for long time investors and novice investors alike.

From the Back Cover

Learn about:

  • What crowdfund investing is and how you can raise money for your business
  • The risks and rewards of crowdfund investing
  • Maximizing the benefits and preventing fraud

Want to rise above the crowd in crowdfund investing?

Are you an investor or entrepreneur looking to get in on the newest big thing on Wall Street? Crowdfund Investing For Dummies walks you through this new investing experience, explaining everything you need to know about crowdfund investing: how much funding you can realistically raise; how to plan and launch a campaign; how to manage the crowd after a campaign is successful; and how to work within the SEC's regulations at every stage.

  • Crowdfund Investing 101 -- get an overview of how this form of private equity or debt investment works and what the potential benefits are to entrepreneurs, small businesses, and investors
  • Make a plan -- find out how to present a solid business plan, define your financial needs, and prepare for a crowdfund investing campaign
  • Manage your campaign -- discover how to market your pitch, tap into your social networks, prepare for potential problems related to your campaign, and successfully complete a crowdfund investing campaign
  • Run with it -- grasp how to communicate clearly and regularly with your crowd, avoid mistakes that could lead your investors to revolt, and keep your investors happy even when your plans are delayed
  • Put the "I" in investor -- get the 4-1-1 on how to measure risk and thoroughly examine opportunities available to you as a personal investor

Open the book and find:

  • How the crowdfund investing concept evolved
  • Why crowdfund investing gained bipartisan support
  • Advice on planning your crowdfund investing campaign
  • How to evaluate crowdfund investing opportunities
  • Best practices in crowdfund investing
  • SEC regulations you need to know
  • Tips for building your crowd and your team
  • Online links to informative videos

About the Author

Sherwood Neiss, Jason W. Best, and Zak Cassady-Dorion are the founders of Startup Exemption (developers of the crowdfund investing framework used in the 2012 JOBS Act). They deeply understand the process, rules, disclosures, and risks of capital formation from both the entrepreneur's and the investor's points of view.

Crowdfund Investing For Dummies - by  Sherwood Neiss & Jason W Best & Zak Cassady-Dorion (Paperback) (2024)

FAQs

Has anyone made money from crowdfunding? ›

Yes, numerous people have made money from crowdfunding. In equity crowdfunding, investors can earn money if the business they've invested in becomes profitable, while in debt crowdfunding, investors earn back their investment with interest over time.

Can you get rich from crowdfunding? ›

Investing in startups through equity crowdfunding can be a great way to make money, but it's important to remember that it's not without risk. Do your research, choose a platform that fits your needs, and invest wisely. With patience and a bit of luck, you could see substantial returns on your investment.

Are crowdfunding investments worth it? ›

The best investment crowdfunding offers several advantages and disadvantages for investors and those raising capital. For investors, benefits include starting with a small amount, potentially earning above-average returns, and gaining more investment transparency.

What is the number 1 crowdfunding platform? ›

Best Overall Crowdfunding Site: GoFundMe.

Do you have to pay back crowdfunding? ›

Donation crowdfunding: Donation crowdfunding does not require the recipient to repay the funds. This crowdfunding type is typically geared toward charities and nonprofits. Debt-based crowdfunding: With debt-based donations, you'll repay the money with interest.

Can anyone invest in crowdfunding? ›

The SEC subsequently adopted Regulation Crowdfunding to implement the crowdfunding provisions of the JOBS Act. FINRA's role is to oversee and examine crowdfunding portals to ensure that they comply with federal securities laws, Regulation Crowdfunding and FINRA rules. Anyone can invest in crowdfunding offerings.

What is the minimum investment for crowdfunding? ›

Best for Accredited Investors

While minimum investment requirements typically range from $10,000 to $30,000, many of the offers have minimums near the low end of this range. Investors will find opportunities with a minimum investment of $5,000, enabling them to diversify their holdings within the platform.

What are the negative effects of crowdfunding? ›

However, there are also some disadvantages to consider before you decide to launch a crowdfunding campaign. These include the possibility of not reaching your funding goal, the risk of not being able to deliver on your promises, and the potential for negative publicity if your project is not successful.

Is 7% return on investment realistic? ›

General ROI: A positive ROI is generally considered good, with a normal ROI of 5-7% often seen as a reasonable expectation. However, a strong general ROI is something greater than 10%. Return on Stocks: On average, a ROI of 7% after inflation is often considered good, based on the historical returns of the market.

How much can I invest in crowdfunding? ›

As a non-accredited investor, you have the option to invest the higher of the following: $2,500; or. If your annual income or net worth is less than $124,000, you can invest 5% of the higher value between your annual income or net worth; or.

What is the average success rate of crowdfunding? ›

What's the average success rate of crowdfunding campaigns? The average success rate of crowdfunding operations is 22.4%. However, many campaigns do get financed, even if unsuccessful. In total, 38.92% of crowdfunding projects are fully funded.

What is the failure rate of crowdfunding? ›

In summary, the negative investment crowdfunding outcomes have actually been much less than would be predicted by traditional angel investing and venture capital investing statistics (2.9% vs. 60-70% failure rates, respectively).

How long does it take to raise money through crowdfunding? ›

Raise Money Quickly

Crowdfunding platforms have a limit, often 60 days, for a crowdfunding campaign. Most successful campaigns happen within even shorter timespans, 30 to 40 days. This is a much faster way to raise money than through series funding, which takes about 12 to 18 months just for Series A funding.

How much can you make from crowdfunding? ›

With Regulation Crowdfunding, startups can raise up to $5 million each year. With Regulation A+ Crowdfunding, you can raise up to $75 million a year. Depending on how much you want to raise, make sure the crowdfunding platform you're considering will allow you to set up a campaign under the appropriate regulations.

What is the biggest crowdfunding success? ›

This article uses bare URLs, which are uninformative and vulnerable to link rot.
RankProjectAmount raised
1EOS$4,100,000,000 (7.12 million ETH)
2Star Citizen$677,535,169+
3Filecoin$257,000,000
4Tezos$232,000,000
46 more rows

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