Equity is the equivalent of ownership. Crowdfunding allows people from everywhere to invest small amounts of money in a small business. The amount of ownership is delivered as shares of the business to each person who is providing funds. This is the concept known as equity crowdfunding. Who Uses Equity Crowdfunding? In the past, wealthy people who were millionaires — or even billionaires — became funding sources, or angel investors. Prominent figures, such as Bill and Melinda Gates, Oprah Winfrey, and Warren Buffet, often became the funding parties for enterprises that needed cash. But now, equity crowdfunding replaces this preferential funding that used to come from big names, so that businesses can fund their enterprises with small amounts of cash from people around the globe. This method of raising capital to meet business needs is gaining supporters on an international level. Its supporters contend that everyone should have an opportunity to invest in small businesses that they feel will be profitable. Conversely, its critics feel that investors should fully understand the risk/reward concept, and that many may not. What Business Receives Funding? TruCrowd provides guidance to the 99% of the “not a billionaire yet” population, who dream about investing in breakout businesses. Other crowdfunding sites focus on private financing, and offer incentive gifts in exchange for your spendable dollars. However, a public offering positions you as a shareholder in the business, and allows access to in-depth company information, and a predictable exit strategy. Any type of business can receive funding upon receipt of approval from the Securities and Exchange Commission (SEC). The SEC process extends up to 90 days, and once complete, links to all the filings, quotes, and trading activity, allowing truCrowd members to invest if they wish to fund the offering. When you are ready to fund or invest, contact us for more information about how equity crowdfunding works to raise working capital for both new and established enterprises.
Equity Crowdfunding: What It Is and Who Gets It
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