NextSeed

• Unique Business Model
• Financial Product Options
• Marketing Benefits
• No Fees Unless Pitch is Successful
• Resources for Businesses
• Industry Types
• Resources for Investors
• Referral Program
• NextSeed Reviews

Unique Business Model

NextSeed provides business owners with a way to find investors and raise money without giving up ownership in their company to accredited investors. With NextSeed, business owners can create a debt offering and invite anyone to invest in their growth without the hassles of traditional financing. The process is as follows:

• Step 1 - Fill out NextSeed's simple online application and quickly find out if NextSeed is the right fit.
• Step 2 - If approved, work with NextSeed's team of financial, legal, and marketing specialists to create and launch the pitch.
• Step 3 - Tap into NextSeed's expert marketing, advertising, and PR support to promote the pitch and raise funds successfully.
• Step 4 - Utilize NextSeed's investor management support platform to streamline monthly payments, investor updates, reward fulfillment, and tax forms.

Financial Product Options

NextSeed offers two financial products for local business owners to choose from: term loans and revenue sharing loans.

Term loans range from $50,000 to $1,000,000 and have fixed monthly payments and set interest rates ranging from 10 to 18 percent. Term loans are great for businesses with steady cash flow and the ability to start making payments immediately, and there are no prepayment penalties, so borrowers can pay them off early if they choose.

Revenue sharing loans range from $100,000 to $1,000,000 and have APRs ranging from 15 to 25 percent. With a revenue sharing loan, the borrower shares a percentage of their gross monthly revenues until they fulfill a total payment back to investors. These loans are good for new businesses that have a ramp up time or are driven by seasonality.

Marketing Benefits

Choosing to work with NextSeed comes with a few additional marketing benefits that most traditional lenders can't provide. For example, businesses that submit crowdfunding offerings through NextSeed get access to a platform for storytelling, a small army of advocates, and expert marketing consultation. Businesses may also receive pre-opening buzz.

No Fees Unless Pitch is Successful

With NextSeed, potential borrowers are not subjected to any fees unless their offering is successfully funded. Even then, it is a one-time fee that covers a variety of services, including handling all required banking, escrow, and payment processing fees paid to third-party providers; helping design and create campaign content; assisting the preparation of legal disclosures and the filing of required legal documents with the SEC; marketing, advertising, and PR guidance for the campaign; facilitating Q&A during the offering; collecting investment commitments and distributing funds; servicing note payments to underlying investors; and preparing and distributing tax forms to investors at the end of the year.

Resources for Businesses

NextSeed offers flexible debt financing from investors in the community. It works with the business owner in crafting the campaign content, offering legal templates and filing support, providing marketing expertise and consultation, and servicing payments to investors throughout the repayment cycle.

Plus, NextSeed continues to engage issuers through community events and networking opportunities to increase community support and engagement even after the campaign has ended. 

Industry Types

NextSeed is open to funding businesses that are “consumer-facing Main Street” business types, such as:

• Food and beverage
• Hospitality
• Fitness studios
• Salons and spas
• Retail

Past industries funded by NextSeed include restaurants and bars, craft breweries, co-working spaces, and spas and healthcare facilities. New concepts created by experienced management teams are welcome in addition to expanding businesses.

Resources for Investors

NextSeed is a great option for investors who want to use their local knowledge about a city to predict success and to invest with pride. Investments start at $100, making it a relatively inclusive community for investors of varied budgets.

All businesses featured by NextSeed must pass an approval process before launching an offering, giving investors a degree of confidence in the offering’s viability. The required paperwork by businesses includes the following:

• Last three years of business’s tax returns (if applicable)
• Balance sheet, income statement, and statement of cash flow for the last three years and current year to date (if applicable)
• Bank statement of the company for the last six months
• Five-year pro forma financial projection
• Copy of rental lease agreement (if funding request is for a new location)

Once a business successfully begins launch/growth, payments are deposited into each investor’s NextSeed account.

Referral Program

NextSeed offers a cash benefit to individuals who successfully refer a business. The company’s referral program lets you earn $500 when a business you refer launches a campaign, and the business itself gets a $500 discount.

NextSeed Reviews

The majority of NextSeed reviews on BestCompany.com are positive. Satisfied customers highlight the company as a great crowdfunding campaign resource and a useful platform for startup businesses. With a simple application process, quick funding, and quality customer service, NextSeed comes highly recommended from its customer base. 

• Risk of Loss
• Time to Funding

Risk of Loss

NextSeed is very upfront about the risks involved for investors. While the company does closely examine each business’s funding proposal via the required paperwork, it doesn’t verify accuracy, completeness, or adequacy of any information. You can find further information about the company’s pre-vetting process on its FAQ page.

Any investment could result in total loss so investors are advised to not invest in NextSeed’s featured opportunities unless they can afford to lose that investment.

Time to Funding

With NextSeed, it can take upward of 21 days for the offering to be fully funded, and there's always the risk that the offering will not be successful. With some other lenders, funding can be obtained in as little as one day.

A study from the Federal Reserve noted that 63 percent of firms apply to online lenders for a fast turnaround, so the wait could deter you from choosing NextSeed.