Are Current Debt and Revenue-Share Interest Rates Fair for Investors?

Brian Belley Brian Belley
Posted at Jun 24

While many investors typically feel that debt deals are “lower-risk” than equity deals in investment crowdfunding, I’ve always wondered if that’s really the case. As investors, we have plenty of options for where to put our money — like zero-risk savings accounts at banks currently offering 4.6% or even 5% interest! So, I decided to dig into the data on debt and revenue-share offerings to see if the interest rates are actually compensating investors for the risks they’re taking.


Required annual interest rates and payback multiples over 6.4 years for investors holding a diversified portfolio of debt and revenue-share Reg CF deals to break-even after accounting for failures and risks.

TLDR: to adequately compensate Reg CF investors for risk and opportunity costs, we estimate that the current average debt interest rate should be roughly 11.1% on pre-revenue deals and 10.2% on post-revenue deals. For revenue share notes, the break-even payback mu

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Categories: Investor Education  |  Reg A+  |  Reg CF
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[CfPA Press Release] CfPA Announces Board Approval of Policy Platform

Crowdfunding Professional Association (CfPA)
Posted at May 20

Industry trade group representing the Regulated Investment Crowdfunding industry releases major policy platform with recommendations for change  

Washington, DC (May 20, 2024) - The Crowdfunding Professional Association (CfPA), the leading trade group representing the Regulated Investment Crowdfunding industry, announced the board's approval of a Policy Platform containing eighteen recommendations for the industry. Through these recommendations, the CfPA intends to advance the fledgling industry, which has enabled over 6,500 companies to raise more than $2.4 billion from millions of non-accredited investors in the eight years since the industry's rules came into effect.

"The CfPA Policy Platform represents the concerns and interests of a wide range of stakeholders in the Regulated Investment Crowdfunding industry," stated Brian Christie, the 2024 President of the CfPA.  “Broad adoption of the platform’s recommendations by industry participants, regulators, and lawmakers...more

Categories: Reg A+  |  Reg CF  |  Regulations & Compliance
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Grateful for the super people at SuperCrowd24

Brian Christie Brian Christie
Posted at Apr 19

On behalf of the Crowdfunding Professional Association (CfPA), I would like to express gratitude to @Devin Thorpe and @Chandan Saha for providing CfPA with the opportunity to co-host SuperCrowd24 and for giving the CfPA board and members the opportunity to share their perspectives and expertise and to connect with a community of attendees from all over the world. The event was highly engaging and informative (-- and provided a welcome diversion following the end of this year’s tax season). 

The agenda was packed, the speakers were amazing, and the topics were relevant across a wide range of themes. Personally, I was pleased to hear numerous discussions about the possible integration of regulated investment crowdfunding into the full capital stack of various businesses -- from small enterprises seeking SBA loans to major corporations managing complex divestitures – as it points to a future where crowdfunding and community-ownership could be an important pro-social subs...more

Categories: Impact Investing  |  Investor Education  |  Issuer Education  |  Reg A+  |  Reg CF  |  Regulations & Compliance
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Dive into the World of Crowdfunding Excellence with SuperCrowdHour February 2024!

Chandan Saha Chandan Saha
Posted at Feb 18

Attention all crowdfunding enthusiasts and aspiring changemakers! The highly anticipated SuperCrowdHour event for February 2024 is just around the corner, and we couldn't be more thrilled to welcome you!

Countdown Begins: With the event date fast approaching, mark your calendars for February 21, 2024, at 1:00 PM Eastern. Get ready to dive deep into the world of crowdfunding excellence!

https://www.youtube.com/watch?list=TLGGSFSdz8WDyigxODAyMjAyNA&v=HoQyB5CFHLA

Meet the CFPA Leaders: Join us as we host the esteemed Crowdfunding Professional Association (CFPA) leaders:

  • Brian Christie, CFPA President
  • Jenny Kassan, CFPA Vice President
  • Brian Belley, CFPA Secretary
  • Scott McIntyre, CFPA Chair

What to Expect: Gain exclusive insights, connect with industry experts, and learn how you can make a difference in the crowdfunding community. SuperCrowdHour is your gateway to unlocking new opportunities and achieving crowdfunding success!

Special Incentive: Remember, attendees who register for an...more

Categories: Investor Education  |  Reg A+  |  Reg CF
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Get Ready for SuperCrowd24 - The Ultimate Virtual Crowdfunding Experience!

Chandan Saha Chandan Saha
Posted at Feb 5

We hope this message finds you well and thriving! We are thrilled to bring you the latest update on an event that promises to revolutionize your understanding of crowdfunding and investment – introducing SuperCrowd24!

📅 Save the Date: April 17-18

📍 Location: Your Screen - It's a Virtual Event!

Get ready for an immersive experience at the impact crowdfunding event of the year! SuperCrowd24 is designed to connect investors, entrepreneurs, and enthusiasts from around the world, all from the comfort of your home.

What to Expect: 100 Expert Speakers: Learn from the best in the business as 100 industry leaders share their insights and strategies for successful crowdfunding and investment.

🎙️ Live Pitch Sessions: Witness entrepreneurs pitch their groundbreaking ideas in real-time! Who knows, you might discover the next big thing to add to your portfolio.

💡 Learn to Invest Like a Pro: Whether you're a seasoned investor or just starting, SuperCrowd24 offers valuable tips and techniques ...more

Categories: Impact Investing  |  Reg A+  |  Reg CF
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Could Regulated Investment Crowdfunding Replace Private Equity for Hospital Ownership?

Brian Christie Brian Christie
Posted at 12/29/2023

A recent headline in the Boston Business Journal read "Private equity acquisitions of hospitals are bad for patients, Harvard study finds"

Here's a link to the original article: https://www.bizjournals.com/boston/news/2023/12/26/private-equity-hospital-harvard.html

The key finding was "A new study from Harvard Medical School found that private equity acquisitions of hospitals led to worse outcomes for patients." 

Some of the online comments on LinkedIn about this article read:

"Why would that surprise anybody. Private equity does not care about patient satisfaction, quality of care outcomes, or adverse event. They care about the bottom line and they need to make a profit so they will do everything to make a profit without any thought of the patient or the physician."

"Of course, a study wasn't required to state the obvious! A special place in Dante's Inferno 9th circle of HELL exists for predatory private equity firms and those in the C-suite who enable them. It's all about lini...more

Categories: Reg A+
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Unlocking Growth: How Customer-Shareholders from Crowdfunding Can Boost Lifetime Value and Enterprise Value

Brian Christie Brian Christie
Posted at 9/27/2023

Increasingly, companies are turning to Regulated Investment Crowdfunding as a strategy to raise capital and convert their customers into investors or “investomers” as many have coined the phrase. As companies consider this business strategy, it’s important they understand the concept of Lifetime Value (LTV) and its impact on Enterprise Value (EV). LTV, short for Lifetime Value of a Customer, quantifies the total revenue a business can expect to earn from a single customer throughout their entire relationship with the company. EV, on the other hand, represents the total value of a business, including its debt and equity. These crucial metrics help businesses assess their long-term profitability and overall worth.

Investment Crowdfunding is not only a way to enhance LTV but also a way to drive up EV.  I recently read a white paper by the company Dealmaker entitled “The Bottom-Line Value of Turning Customers into Shareholders” which cited research and s...more

Categories: Equity (RIC)  |  Reg A+  |  Reg CF
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DeRosa Group: CfPA Crowdfunding Issuer Interview Series

Crowdfunding Professional Association (CfPA)
Posted at 8/23/2023

The DeRosa Group is a family-owned business that invests in residential and commercial properties, with a mission of "Transforming Lives Through Real Estate." It was founded by Matt and Liz Faircloth in 2004. Their journey began with the purchase of a modest duplex just outside of Philadelphia, fueled by a $30,000 private loan. Since then, they have mastered the art of optimizing properties for their highest and best use, revolutionizing single-family homes, multi-family residences, apartments, mixed-use spaces, and retail outlets, as well as offices. This interview was conducted with Herve Francois.

INTERVIEW

 

CFPA: Can you tell us a little bit about your company? What does your company do and at what stage is it?

Herve Francois: DeRosa Group is a real estate investment company that invests in large multifamily apartment complexes. Our motto, "Transforming Lives Through Real Estate" is all about improving the living situation of our tenants by providing them an attractive plac

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Categories: Issuer Education  |  Reg A+  |  Reg CF
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