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Equity Crowdfunding: Good News for Investors and Entrepreneurs

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Equity Crowdfunding: Good News for Investors and Entrepreneurs

By Startup Valley (516 words)
Posted in Equity Crowdfunding on September 28, 2012

There are (3) comments permalink

Equity crowdfunding could mean great news for investors as well as entrepreneurs. Through equity crowdfunding, new entrepreneurs can invest in a new startup company that they see growth potential for. The JOBS Act will completely change the traditional way that startups have sought out funds for their business in the past. This new bill also sets new rules in place that will protect investors, and ensure fairness for both parties. The JOBS Act will create new opportunities for small businesses and streamline the process of finding financial backing for your startup.

How will Investors Benefit?

There are plenty of benefits that will come out of crowdfunding for the traditional and modern day online investors. Traditional investors will be exposed to a completely new world where they will be able to become familiar with crowdfunding websites such as StartupValley and review the business plans and future goals of various startup companies. By traditional investors being able to make the switch into online crowdfunding will allow them to understand the needs of companies without having to waste time setting up a meeting only to realize that the relationship between the investor and startup creator did not live up to their expectations. While most modern day investors should be well accustomed to online crowdfunding, equity crowdfunding is a great way to share equity in a few or multiple start ups that investors truly believe in, and are passionate about seeing them get to the next level.

How will Entrepreneurs Benefit?

Online crowdfunding is no longer just for funding artistic dreams. Instead, it will begin to fund sustainable businesses, which will in turn, create jobs and boost the current state of the U.S. economy. One way that entrepreneurs can benefit from crowdfunding is reducing their risk factor. Many have took the risk of starting their own company, but later realized that the particular goods or services offered have high competition or low demand. Online crowdfunding is a great way to test your business idea, because you will be able to see if “the crowd” is supportive of your potential startup. The days of having that awkward conversation with your uncle, asking him to invest $10k in your startup are now over. Having the ability to fundraise from your customers before you launch is one of the ultimate tests to figure out whether or not your business has legs to walk on. Raising funds for your startup online also provides social proof that your campaign has the ability to help create loyalty from customers, based off the fact that they want to see something they were involved in succeed.

Benefits for Both Parties

Crowdfunding will provide multiple benefits to investors and entrepreneurs, because there will now be a solid platform where aspiring entrepreneurs can publicly share their startup idea with anyone from investors, facebook friends, colleagues, or the ordinary person, in return for equity. Are you interested in investing or raising funds for tech startups? Signup Now!

Comments (3)

cameron posted on: October 18, 2012

It is great that the crowd funding model has come about, but people should be able to do their due diligence in depth just like it was a big deal. a lot that seems not to happen as much aas one would think. there is still alot of process and transparency or disclosure to be built in to this model

cameron posted on: October 18, 2012

meant to add http://www.globalkap.com

top binary options brokers posted on: November 11, 2012

Start-up companies can really benefit on crowd funding. As long as they are projected to succeed, small companies as well as small investors can turn to crowd funding.

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