SeedInvest
Is This Your Business?1.5
1.5
Author: Kaitlyn Short
LAST UPDATED: March 12th, 2024
SeedInvest is a startup investing platform seeking to provide members access to investment opportunities without charging investor fees or carried interest. SeedInvest was founded in 2012 by a team of experienced investment professionals who played a part in the 2012 JOBS Act.
Top Ranked Companies
The Good
- Model type
- Fund type
- Maximum allowed raise
- Deadlines
- Receiving funds
- Administrative work options
Model Type
SeedInvest operates primarily as an Equity Model. On their platform, companies have direct access to accredited investors around the world. Due to SeedInvest's strict vetting process before granting access to their crowdfunding platform, only a slim 1% of companies are approved to crowdfund on their website. Companies need to demonstrate proof of concept, have at least two full-time team members, and are incorporated as a business in the United States. SeedInvest has fostered a network of investors interested in funding small businesses and companies who have a product that has proven viability in the marketplace. Businesses are able to directly connect to and appeal to investors by offering equity in their company. They are also able to utilize integration of social media as well as advertising tools to promote their company. This allows users to appeal to friends, family, and customers for donations to their business venture.Fund Type
SeedInvest is an All or Nothing fund type. Unlike 'Keep What You Raised' types that other crowdfunding platforms offer where you receive all funds donated whether you reach your goals or not, with All or Nothing, if you don't reach your total predetermined monetary goal you don't receive any funds. This can be a struggle for new businesses attempting to raise much-needed funds in an equity crowdfunding model.Maximum Allowed Raise
With SeedInvest, small businesses and companies can raise between up to a maximum of $5,000,000. This is only if they have been proven viable in the marketplace with the funding they need. The average funding amount reached is approximately $40,000. SeedInvest's maximum amount is one of the highest out there when compared to other equity crowdfunding sites that typically have a six-figure cap.Deadlines
With SeedInvest, companies have 60 days to demonstrate they have raised the funds they are asking for. For some, this may be too short-especially for a business trying to get off the ground or who have never raised funds before.Receiving Funds
SeedInvest requires companies to reach a minimum funding target (determined by each individual business) in order for their campaign to be considered successful. Investments will not be allocated until the minimum funding target has been met. This may disqualify some businesses from achieving any level of funding if they are unable to reach minimum funding targets.Administrative Work Options
Their crowdfunding platform aids companies in incorporating due diligence, legal documents, and processing of investments in order to make closing investment opportunities quickly. This provides valuable support to businesses when appealing to investors.The Bad
- Fees
Fees
The fees required by SeedInvest are expensive when compared to other crowdfunding platforms. They require 7.5% of the funds raised upon completion of a campaign in addition to between $3,000 and $5,000 in escrow, due diligence, marketing and legal reimbursement. This is substantially more expensive than a flat 5% completion fee required by many other crowdfunding platforms. Unlike some crowdfunding companies who will charge you a fee if you don't complete your campaign, SeedInvest does not charge a non-completion fee.The Bottom Line
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Mk K Los Angeles, CA
Misnoming, Misrepresenting, Misleading, and ultimately frustrating
Well, they want to pump investments from you, if you are a qualified investor, BUT NOT TO FACILITATE INVESTMENTS FOR YOUR STARTUP if you are an entrepreneur. They do not mean to help you to bring investments into your business. They have their own businesses to finance.
I wonder where they get their "startups" for investors, but looks like definitely not from their platform.
When you send them a pitch and business plan the answer is "It is too early a stage for your company to apply for investment through our platform"
(sounds nice for a platform named "SeedInvest.com" and "StartEngine.com", which are the same, actually).
Both "SeeInvest.com" and "StartEngine.com" appear to be harsh and misleading misnomers. I have sent a request for the company that is operable for 2 years, making 500-700K a year, and looking for funds to expand. The answer was, of course:
"it is a too early stage to apply for financing". (?!)
Looks like StartEngine is glad to help you long after you have started your engine with somebody else, and SeedInvest will be there to help you only long after your crops have grown.
Not exactly a hoax, I guess, but a subtle misrepresentation close to it, causing a tremendous waste of time for aspiring entrepreneurs and breaking their hopes and enthusiasm through misleading manipulation.
1 year ago
THE ANOINTED WALK Rev R Lee Banks Weehawken, NJ
After my wife and I decided to take what was a significant amount of money out of our savings, to invest into something long term, something we could fall back on later we decided to invest through SeedInvest.
This company never clarified the process, and it too a few months for them to even acknowledge and validate the investment.
The investment was with a company called NowRX, and they were expanding; however, like many other companies that SeedInvest utilizes, after they raise a significant amount of money, they sell the business at a discounted price and who knows what is done with the rest.
They sent my wife and I an email asking us to vote on the sale of this business, as a shareholder, and as a bonus we will NOT receive a dime of our money back.
In other words, they simply took our entire investment and sent us a letter saying "sorry".
I would have been better off taking those thousands of dollars that we invested and going to the Casino. At least we would have had more fun throwing it away.
I'm really not sure how the Business Laws of today have been so devised to steal from the people who they are supposed to be protecting.
2 years ago
Sanj Jersey City, NJ
Big scam ! Their due diligence is a joke , I invested in Winc @1.1 per share and within 2 years the company did go ipo , all along the way stating that winc was experiencing exponential growth and later on Winc also raised more money at 110mill valuation few months later they ipo, and am all excited that my investment has grown 4x , only to find out later that WiNc did a reverse split of 8:1 before going public , which means the company is worth 1/2 of their seed investment , so it’s a utter joke and big scam of fooling small investors. Be weary of seedinvest and also the companies raising money there .
3 years ago
Rich N New London, CT
I DO NOT recommend this company.
A month after signing up for an opportunity, I received an email that the investment was not funded in time and was canceled. There was NO communication from SeedInvest except for that email. When I inquired I was told there was an issue when they tried to fund the account from my linked source of funding.
Feeling something was odd as my bank of 25 years would let me know if there was a "charge" issue, I called the bank. The only transaction from SeedInvest was a $0.25 hold authorization on my card and that it was authorized but never collected. There was no attempt to charge the funding amount at all by SeedInvest.
When given that information SeedInvest then told me that there was an error (with no details on what that error was) and that the funding round was closed and there was nothing they could do. And then they pitched me other offers from their site.
This is not an honest company.
Please beware when dealing with them if you choose to do so and followup closely. I have used other crowdfunding sites and have not had this issue.
3 years ago
Reza Ghafoorian Washington, DC
This is from their Terms and Conditions that they make you sign before using their service. I don't have to say anything more!
"By providing content or Data on the Site, subject to the Privacy Policy, you grant us a royalty-free, non-exclusive, worldwide license, under your intellectual property rights, to copy, reformat, index, modify, display, distribute and put to commercial and other uses such content or Data. No compensation will be paid with respect to our use such content or Data. SeedInvest neither warrants nor represents that your use of materials displayed on the Site will not infringe rights of third parties not owned or affiliated with SeedInvest."
3 years ago
Miguel Roncal Centreville, VA
There is ZERO communication. They answer you when they are good and ready. If you are a startup and want to crowdfund but want your investors to lose faith in you, by all means, use them. I have had to call the actual company I am investing in to get clarity since no one at SeedInvest responds to emails. Their site has "oops!" errors and there is no resolve. It honestly begins to feel like the CSRs they have are bots and then eventually it feels llike youve been scammed by some "prince" in a far away land. The only number I was able to reach was some obscure google search I found and the person told me they have not worked for them in over 3 years...and she gets these calls all the time. Steer clear.
4 years ago
Lee Hall Philadelphia, PA
They encourage investors to buy into as many startup companies as possible for the best potential returns. I'm glad I didn't invest in more than one. I feel totally taken advantage of. I'm a music lover and decided to invest in the 8tracks platform in 2016. By December 2019, the company was in bankruptcy and now, April 2020, the law firm says equity holders will get nothing at all except a downloadable letter to show an accountant. The communication about what was going on at 8tracks those 4 years was scant and did not inform me of the seriousness of the financial problems. So 8tracks was not a sound business. Instead of properly vetting it, SeedInvest basically used a lot of small investors' money and let us find out the hard way.
I'd assume SeedInvest seems attractive to many small investors like myself. At first it appeared to be high-tech, well-run, low-risk but exciting and inspiring. After all, these are small businesses and many of them have real emotional appeal.
But the first problem came early on, and it was a big one: double charging investors' credit cards. While SeedInvest eventually rectified this, the 8tracks blog refers to it in a way that, at least partly, puts blame on SeedInvest for the financial failures of 8tracks.
Next issue: SeedInvest and the broker, VStock Transfer, were terrible at answering questions about whether shares had been issued, where they were, and how to keep track of them. So I never could, and I don't know who could. In the digital era this is both unprofessional and absurd.
Every aspect of my experience has been unpleasant, and I'm ultimately left with zero dollars from my initial investment. There is no one to take my side. This is about as bad as it gets, and I'd say: Walk away from SeedInvest's much-vaunted opportunities.
5 years ago
W Bellevue, WA
Can't put up enough caution signs about dealing with SeedInvest as an issuer. Massive turnover and personnel issues, many misrepresentations, ultimately a failed offering that was so costly as to nearly put us out of business. Impossible to reach senior management without threatening to call the SEC. If you want to place the fate of your startup with a bunch of inexperienced twenty somethings and a company with a culture of dishonesty, go for it. But I've cataloged all their offerings and most don't seem to make it, then immediately get completely scrubbed from any internet evidence. They have a very low success rate.
7 years ago
Pierre-Luc Morneau
I was impressed at first by the way they embraced technology to serve customers, but things changed when they gave me confirmation of a refund process. I provided everything they asked, received written confirmation. After many follow ups, i was told that it was a manual process since they are not used to handle refunds, so i waited. Followed up again since they were supposed to follow up, but heard nothing. Then i was ask AGAIN to provide more info. Totally unacceptable! Lucky for me the amount is small, but be careful when considering larger sums as you might have to experience what i've been through.
8 years ago
Bilal Janjua Scottsdale, AZ
I Do Not Recommend this Company !!!
I am very much disappointed, your guidelines are not clear on submission, I was only aware of your guidelines after your rejection of my business. We spend over 1 MM on our startup. I need an exact reason of rejection, I submitted on late Friday how can you read 60+ pages / understand over the weekend on 2 days ? If this is your business model then I have to report you to the proper authorities. This is not professionalism.
3 years ago Edited May 24, 2022
Ilona Veselova Lake Station, IN
They're a joke. They don't even review the applications, just look at the dollar signs...if I were them, but now that I've read a lot of other reviews, I'm glad they denied me with no explanation, saying they have a lotbof applications. Who's actually able to use their services? And don't even waste your time reading their story, probably all bs cuz doesn't seem like same people reviewing ANY applications. Don't waste your time, and especially dont waste your time writing them a letter, they don't care...why even have anyone read theirs?. Joke
3 years ago
Gino Gia Arlington, VA
Terrible customer service. After a few attempts to log in (I confused my email accounts), the company blocked access to my account. No big deal, it happens. However, what it is beyond normal is the fact that after a month and 30 email exchanges with Customer Service, the company is still not granting me access. Are they scamming customers? It certainly seems so.
4 years ago
Thomas S Tampa, FL
Seedinvest feels more like a quick cash grab then a entry into early entry investing for the average retail investor.
They do now have your best interest at heart, they do not make sure you don't get taken advantage of, they do no process documents in a timely manner (they will take your money very quickly) ... JUST STAY AWAY FROM SEEDINVEST.
With Seedinvest, the earlier you invest and the longer you wait, the less your shares are worth.
4 years ago
Review Source
Baba. aja
Scam scam , that’s what their name support to be , through seedinvest I invest in a company call NowRx , $1200 as serie B , preferred stock. Seedinvest know that this company is not doing good but they see let asking investors money , 2 years later the company is in bankruptcy and now we lose our money
2 years ago
Russ Krengel Austin, TX
I invested in RXNow through Seed Invest and it was felt like a sham but was certainly a shame. SeedInvest made millions while RXNow burned through every dollar that Seed Invest raised. The story ends w RXNow bankrupt. Investors lost everything.
2 years ago
Christian San Francisco, CA
Poor communication throughout the campaign, claims to capital upon signing up that we saw no evidence of throughout the campaign. Poor management of the campaign.
If you're looking to raise capital through crowdfunding, look elsewhere.
These guys won't be around much longer.
7 years ago Edited September 14, 2021
Bruce Grob Swannanoa, NC
A scam. Raised $22 million for a company and less than a year letter the company went chapter 11, and all investments were now worth $0
2 years ago
Terry Lindgren Acton, MA
Stay away! It has degraded in the last couple of years to the point where you cannot communicate and they are unreliable and opaque. STAY AWAY!!!
4 years ago
ALIAZAM RASEL Anaheim, CA
This company is cheat. They charge 3% convenience fees. Also you you try to withdraw your money. They hold your money. Do not invest here.
5 years ago
jerry coles Bakersfield, CA
Terrible...Lost $10,000 with no response from them or the company I invested in...Leaf....They claim to make Grow Boxes but both companies are a scam
5 years ago
Luke Davis
SeedInvest made claims to capital they ultimately didn't have access to and it cost our company the round.
8 years ago
David Macario San Diego, CA
Terrible, zero communication, constantly messes things up, and is holding my funds hostage.
3 years ago
E К Irvine, CA
They are not returning my money. Please, be careful
Avoid this "company"
2 years ago
harry Lynnwood, WA
They will make you waste your time. Amazingly unprofessional !!!
5 years ago
