Crowdfunder
Is This Your Business?1.5
1.5
LAST UPDATED: June 27th, 2019
Founded in 2011, Crowdfunder is a leading equity crowdfunding platform. Their mission is to bring capital to early-stage companies while providing an opportunity for investors to access top deal-flow. Mature companies are also welcomed for Series-A and Series-B funding. Businesses accepted include Tech Startups, Social Enterprises, Small Businesses, and Film & Entertainment.
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The Good
- Model type
- Fund type
- Maximum allowed raise
- Deadlines
- Administrative work options
Model Type
Crowdfunder is an Equity crowdfunding platform. Unlike other crowdfunding sites which have restricted people to simple donations or the purchase of a product or rewards, Crowdfunder allows you to become an investor/shareholder in a company.Fund Type
Since Crowdfunder charges a flat one-time fee to allow entrepreneurs to use the money they raise for their business, it functions as a "Keep What You Raised" funding type. With Crowdfunder, you get to keep the funds raised regardless of whether or not you reach your goal. This is because investors invest with the contingency of your business being a success and not if you reach your fundraising goal. This provides for more flexibility, since it's common to not reach your funding goal the first time around. The funds you do raise, if you get to keep them, can go towards growing the business.Maximum Allowed Raise
There is no cap for the amount of funds you can raise, but Crowdfunder recommends a minimum investment of $5K - $25K. This is a good recommendation since most transactions happen in this range and the lower the minimum investment is, the wider the audience of investors you have to choose from. Crowdfunder also allows you to make changes to your fundraising goal at any time, but you'll have to also adjust these numbers in your deal documents with investors.Deadlines
A campaign typically runs for 60-90 days on Crowdfunder. This time allows for you to leverage your network, generate leads, and close investors. Crowdfunder lets you extend your end date if you have not reached your fundraising goal.Administrative Work Options
Crowdfunder offers analytics services to help with administrative tasks. Their analytics gives you insight into who is looking at your deal and what kinds of investors are interested. When you pay for their Fundraising Pro plan, the following is included:- Ability to Launch Deal on Crowdfunder
- Access to Crowdfunder's Investor Network
- Access to fundraising and marketing tools within our product
- Access to the Investor CRM system
The Bad
- Fees
- Receiving funds
Fees
Although they do not take a percentage of funds raised, Crowdfunder is expensive to do business with. It's initially free to join but they charge a monthly fee of $399 launch your project discoverable to their network of accredited investors and use the money you raise for your business. The Amplifier Plan ($499/month) provides all the benefits of the Launch plan, but includes investor tools like deal analytics and investor browsing. It should be noted however, that as an alternative to this plan, customers can opt for one free month, and three total months of $999. The highest-tiered plan, known as the Accelerator, goes for $1,999/month. It includes all the features of the Amplifier plan, plus personal coaching, marketing templates, and tips on pitching to investors. While these are great features, spending nearly $2,000 a month can be a tall order to fill for people or businesses with few resources.Receiving Funds
Another less-than-impressive aspect of Crowdfunder is that the company does not deal directly with investments and transactions. The actual transaction of wiring money does not happen through Crowdfunder, and the closing of dollars will happen offline with the company. Especially with such high fees, this is a feature Crowdfunder should be able to offer their users. It is rare in the crowdfunding industry to find a site that does not offer this typically included service.The Bottom Line
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Mike Green Santa Monica, CA
Amazing Customer Service from their team. Definitely recommend doing the Accelerator package and Investor Newsletter. Its the quickest way to get to the front of every investor quick.
Overall enjoyed my 45 Day raise on the platform and will be back in touch for our Series A.
Main point of advice-- it cost money to close money!
8 years ago
Mike Azzarello Thousand Oaks, CA
Encountered several issues with Crowdfunder. First, the app wasn't working by not showing user access to documents, so I had no idea if people were looking at the funding docs or not - "a known bug" according to CF support.
Second, got a lot of fraudulent interest. Some were just lonely people looking to carry on an email conversation, others were (this is real) "the former finance minister of Nigeria". So CF does no vetting of any kind.
The cost starts low with the $399 fee for a few months, but then you get an email that says your campaign is paused until you renew. I did a cost/benefit analysis and decided to try some of the sites that actually allow non-accredited investors.
Finally, I participated in CF when they first launched their Beta, but before the JOBS Act had changed the laws. So imagine my surprise when my company's profile was published and I received an email from the California Secretary of State informing me that advertising investments was still "illegal"!! So much for a "closed beta".
8 years ago
Marie San Diego, CA
LAME:
1. The "funds raised" metric is NOT the money raised on Crowdfunder ( they show the total amount the company has raised from all sources, including your Uncle Jim two years ago.) the capital raised on Crowdfunder site is a tiny fraction of what they show. Their approach is false and misleading.
2. the staff may have nice intention, but they are junior light weights.
3. Most accounts listed as "investors" simply are NOT investors - they seem to be window shopping, picking documents, etc.
4. The "followers" metrics are bogus. If person X follows you, you are automatically listed as following X..... This is false and misleading leading.
Overall, Crowdfunder is an expensive waste of time.
Go get Angels yourself - way more productive .
8 years ago
Ted Nunn Roswell, GA
Don't be fooled by this company. Their goal is not to raise money for your idea, but to sell you monthly packages ranging for about $400 - $2000. There're other options to present your idea to investors without paying high premiums without guarantees.
7 years ago
