Is crowdfunding a good fit for my business?

Samson Williams Samson Williams
Posted at August 10

 
 

Q: Is Crowdfunding a good fit for my business? 

 

A: Always. 

 

I often get asked, “ Is crowdfunding a good fit for my business?” The answer is 100% of the time “Absolutely”. Why is pretty simple and straightforward and we’ll outline the why investment crowdfunding is suited for your business below. 


Funding Your Business - Knowing Your Options

Bank Loans. Traditional means of funding your business include bank loans and other forms of financial instruments that your bank offers. However, for many businesses banks are not your friends. While it’s true you can get a loan or business line of credit when you’re cash flow positive and don’t need them, securing a business loan or line of credit when you need it (e.g.: pre-revenue) is nearly impossible. If you can get a bank loan then why use crowdfunding? You’re right. Good luck meeting the bank’s underwriting requirements. Even if you can qualify for a bank loan, crowdfunding may offer a few other...more

Categories:
Tags:
  • jobsact
  • investment crowdfunding
  • crowdfunding
  • equity crowdfunding
  • debt crowdfunding
  • regcf
  • rega
  • regd
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Raising Money for Space ventures? Three steps to improve your odds by using Triangle Financing & Investment Crowdfunding.

Samson Williams Samson Williams
Posted at August 6

 
 
 
 

Three steps to improve your fundraising odds by using Triangle Financing & Investment Crowdfunding. 

By Samson Williams & George Pullen 


Raising money for any business is hard. Raising money for Space / Aerospace businesses is even more challenging. Even when you have the investor network, stellar product and the stars in your favor, things can still go - well as things go in entrepreneurial endeavors. Despite the difficulties in raising money, new and emerging ways of finding, tapping into and receiving funding have emerged, not only for Space based ventures but also the terrestrial based ones. What are these new ways of raising money? Well, outside of Venture Capital, Private Equity and Banks what are your funding options when you want to: 

  • Start a business
  • Scale an existing business
  • Run a profitable business  

Whether you think of yourself as an Entrepreneur, Small Business Owner, Founder or just a woman with a dream,...more

Categories:
Tags:
  • investment crowdfunding
  • space ventures
  • space funding
  • aerospace funding
  • aerospace financing
  • triangle financing
  • triangle financing method
  • jobs act
  • regcf
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$5M reason to go small -The Future of Investment Crowdfunding.

Samson Williams Samson Williams
Posted at July 29

 

$5M reason to go small -The Future of Investment Crowdfunding. 


The buzz in the investment crowdfunding industry these days is all about when will the SEC increase the funding limit of JOBS Act Crowdfunding (aka equity crowdfunding) from $1.07M dollars to $5M. Rumor has it that there has been a flood, a FLOOD, of RegCF platform applications in anticipation of the $5M limit increase. Why is raising the maximum that a business can raise under RegCF rules to $5M so important? It’s not. 

I know you’re busy so I’ll leave you to consider the following reasons why a $5M limit is misleading and the basis for the most abusive bit of narrative economics within the crowdfunding industry, the random investor limits on retail investors.  

By “increasing” the limit to $5M it reinforces the idea of unaccredited vs accredited investors. Meaning, “unaccredited” and “accredited” investors are randomly manufactured designations that predate nearly everyone reading this except Irwi...more

Categories:
Tags:
  • regcf
  • crowdfunding
  • $5M
  • $5M crowdfunding
  • $1.07M
  • RegA+
  • RegA Plus
  • accredited investors
  • retail investors
  • investment crowdfunding
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The Republic Note Token - Is It a Good Investment?

Brian Belley Brian Belley
Posted at July 11

On July 16, 2020, Republic will officially launch its sale of the Republic Note profit-sharing token at a price of $0.12 per Note token. Accredited investors will be able to purchase the tokens under Reg D on July 16, while non-accredited investors will have to reserve their allocation of tokens and wait until the approval of the Reg A offering later this year.

While there is no arguing that Republic's Note token is innovative and pushing the industry forward, everyone has been asking me one question over the past few weeks. Is the Republic Note token a good investment? 

While this article is not investment advice and investors have different goals and risk tolerances, we will attempt to provide an independent analysis of whether the $0.12 per Note price is fairly valued or not for investors. We will perform a Discounted Cash Flow (DCF) analysis for optimistic, typical, and pessimistic scenarios to arrive at a rough valuation range for the Republic Note token.

To download a copy o...more

Categories: Featured
Tags:
  • note
  • republic
  • tokens
  • crypto
  • investing
1 comment

Temporary Relief for Investment Crowdfunders

Jennifer Kassan Jennifer Kassan
Posted at May 25

I recently joined the board of directors of the Crowdfunding Professional Association.  The board asked me to draft a letter to the Securities and Exchange Commission requesting emergency temporary relief from the onerous requirements under Regulation Crowdfunding to prepare reviewed financial statements.  We submitted the letter on April 7.

To our surprise, the SEC released emergency temporary rules on May 4.  The key provisions are:

  • financial statements do not need to be prepared to launch a campaign (but investment commitments cannot be accepted until the financial statements are provided)
  • the amount you can raise without having to prepare reviewed financials has been increased from $107,000 to $250,000


These temporary rules apply for Regulation Crowdfunding campaigns started between now and August 31, 2020, and the issuer must have been organized and operating for at least six months.

If you’d like to take advantage of these temporary rules, please contact me at in...more

Categories:
Tags:
  • crowdfunding
  • regulations
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What Financial Returns Should Investors Expect from Equity Crowdfunding?

Brian Belley Brian Belley
Posted at May 19

It’s no secret that investing in early-stage, private companies is extremely risky. As with any investment, investors need to balance this increased risk with an increased potential reward.

So what kind of financial returns should you expect - and demand - as an equity crowdfunding investor? 

While equity crowdfunding is still in its infancy, we can look at a combination of past early-stage investment performance along with some current equity crowdfunding results to begin to build a picture of what types of returns investors might seek.

After all, if there is only a minor boost in returns offered between passive public market index funds and the active efforts involved in screening equity crowdfunding deals, many investors will likely stick with ETFs and index funds.

First, we will look at some private market studies on Angel Investors and Early-Stage VCs that suggest early-stage investments have historically obtained an average ~26% Internal Rate of Return (IRR).

Next, since ear...more

Categories:
Tags:
  • Equity Crowdfunding
  • Investors
  • Returns
  • Reg CF
  • Reg D
  • Public vs. Private Market Returns
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Three Ways the U.S. Gives Tax Relief for Investing in Startups

Brian Belley Brian Belley
Posted at May 2

With more than 90% of Seed and Series A startups failing to provide an exit for investors, investing money in an early-stage business is not for the faint of heart. To help entice more investors to risk their capital in early-stage ventures, the U.S. provides special tax relief for startup investors.

While startup investments can qualify for long-term capital gains, certain investments can qualify for even more preferential U.S. tax treatment - sometimes up to 100% tax-free gains.

The three tax sections of the Internal Revenue Code (IRC) that every startup investor should be aware of are:

We previously covered five key tax questions every startup investor must answer. Let’s now explore the potential federal tax write-offs from one of those questions in more detail.

Section 1202 - up to 100% exemption on QSBS gains (up to $10M or 10X cost basis)

The first startup investment tax benefit is under Section 1202 of the Int...more

Categories:
Tags:
  • Taxes
  • Equity Crowdfunding
  • Section 1202
  • Section 1244
  • Section 1045
  • Startup investing tax benefits
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Cannabis + Crowdfunding: The Future of Green Financing.

Samson Williams Samson Williams
Posted at 10/29/2019

 

Cannabis + Crowdfunding: The Future of Green Financing.


There is no money in growing cannabis. This is not a debate, it’s just a simple fact. There is a reason you’ve never meet a rich rice, banana, tobacco, watermelon and definately dairy farmer. Farmers are at the bottom of the revenue stream. Why is that? Commodities. Once something is commoditized farmers always get screwed. Yes, farmers do the hardest work/labor. However, who makes the most money in any commoditized ecosystem? Hint, it’s not retailers. So, if you’re question is, 


“Can I use Reg CF, Title III of the JOBS Act, to raise up to $1.07M dollar for my cannabis farm?” 


The answer is, “Yes, you can. But don’t do it. Cannabis cultivation is a dead industry”. I know. I know. How can something be a dead industry when its not even taken off yet? I said cannabis cultivation is a bad bet. You simply can’t scale as fast as the cigarette companies. However, there are many avenues to make money in the cannabis spa...more

Categories: Featured
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