Equity crowdfunding is no longer the new kid on the block; by 2024, it has cemented itself as a powerful method for startups to raise capital from both retail and accredited investors. While dozens of platforms exist, not all are built the same. Knowing the nuances behind each platform—like their fee structures, investor reach, and, crucially, how they fit your specific fundraising goals—can be the difference between a successful raise and one that struggles. In this comparison, we’ll move beyond the surface-level features of Wefunder, Republic, StartEngine, Dalmore Group, Issuance, and DealMaker, exploring insider knowledge and data points often overlooked by first-time founders.
Platform #1: Wefunder
Wefunder is often dubbed the “Kickstarter for startups,” but it’s more than that. While the platform’s simplicity attracts early-stage founders, its secret sauce lies in its ability to rapidly build momentum for a campaign. Wefunder’s recommendation engine favors campaigns that generate interest quickly, meaning you need to line up your initial investors ahead of time for an early push. This “pre-launch warm-up” is a tactic many successful campaigns use to climb the platform’s leaderboard, which increases visibility among their 1.5 million-strong investor base.
Key Features
• Investor Network: Over 1.5 million investors.
• Total Capital Raised: Over $700 million.
• Average Raise per Campaign: Approximately $350,000.
• Success Rate: About 75% of campaigns meet their minimum funding goal.
• Regulation CF Focus: Wefunder allows companies to raise up to $5 million under Reg CF, making it ideal for early-stage startups looking for quick capital.
• Support Services: Offers guidance on campaign creation and marketing strategies.
Fees
• Success Fee: 7.5% of the total amount raised.
• No Upfront Costs: Startups can launch campaigns without upfront fees.
• Fee Waiver: Fees are waived if you bring an investor contributing $25,000 or more.
Suitable Industries
Wefunder supports a broad range of industries, including tech, consumer products, food & beverage, and entertainment, making it versatile for businesses appealing to retail investors.
Platform #2: Republic
Republic’s reputation for due diligence isn’t just marketing fluff. Their vetting process is among the most stringent in the crowdfunding space. Only about 5% of applicants are accepted, which makes the platform appealing for investors looking for high-quality deals. However, once you’re in, Republic’s community-driven nature plays a big role in campaign success. Investors on Republic don’t just invest passively—they often become vocal advocates.
Key Features
• Investor Network: Over 2 million members.
• Total Capital Raised: More than $1 billion.
• Average Raise per Campaign: Around $500,000.
• Success Rate: Approximately 90% for accepted campaigns.
• Diverse Offerings: Republic supports Reg CF, Reg A+, and private placements, attracting both retail and accredited investors.
• Marketing Support: Robust marketing and promotional support for successful campaigns.
Fees
• Success Fee: 6% of funds raised in cash and 2% in Crowd SAFE (Simple Agreement for Future Equity).
• No Upfront Fees: Fees are only charged upon successful fundraising.
• Additional Costs: Possible legal and compliance expenses during due diligence.
Suitable Industries
Republic is ideal for tech-focused startups and companies in emerging industries such as biotech, AI, and blockchain, seeking larger funding amounts.
Platform #3: StartEngine
StartEngine’s secret weapon is its secondary market. Liquidity in crowdfunding has always been a pain point for investors, but StartEngine’s secondary market has changed the game by allowing investors to buy and sell shares post-campaign. This adds an element of tradability that’s not available on most other platforms. If you’re considering a Reg A+ raise, this liquidity option can be a compelling selling point to attract larger investors looking for a quicker exit.
Key Features
• Investor Network: Over 2 Million members
• Total Capital Raised: $1Billion+ raised
• Average Raise per Campaign: Around $500,000.
• Success Rate: Approximately 85%.
• Secondary Market: Offers StartEngine Secondary, a platform for investors to trade securities post-campaign, enhancing liquidity for investors.
• Marketing Support: StartEngine provides optional marketing packages to boost campaign visibility.
Fees
• Success Fee: 7% of funds raised plus 2% of securities sold.
• Upfront Fees: $10,000 for compliance and due diligence services.
• Optional Services: Additional marketing packages are available at extra cost.
Suitable Industries
StartEngine is suitable for companies across various sectors, particularly those interested in larger raises and secondary market trading.
Platform #4: Dalmore Group
Dalmore Group is in a different league compared to traditional crowdfunding platforms. Specializing in Reg A+ raises, they are ideal for companies looking for substantial capital—$10 million and above. But here’s the kicker: Dalmore does not bring investors to you. That’s up to you. However, what they excel at is ensuring your campaign remains in strict compliance with SEC regulations—an often overlooked, yet critical component when dealing with large sums.
Key Features
• Offerings Facilitated: Over 200 Regulation A+ offerings.
• Total Capital Raised: More than $4 billion.
• Success Rate: High, given their selective client acceptance.
• Expertise in Regulation A+: Ideal for mature companies seeking to raise up to $75 million.
• No Investor Network: Companies using Dalmore must source their own investors, though the platform provides compliance and regulatory support.
Fees
• Success Fee: Typically 1% of funds raised.
• Upfront Fees: May include a retainer fee and other service charges.
• Additional Costs: Issuers are responsible for marketing and legal expenses.
Suitable Industries
Dalmore is best suited for companies in real estate, fintech, and manufacturing that are looking for substantial capital.
Platform #5: Issuance
Overview
Issuance operates in a niche market— Reg D and Reg A+ offerings targeting accredited investors. Their platform is highly customizable, allowing issuers to essentially “build their own” crowdfunding experience. If you have a highly specialized offering and want to attract accredited investors, this is a strong choice. However, their fees are negotiable, meaning the platform is best suited for companies that can afford the extra spend on customization.
Need More Capital for Your Business?
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Expert Crowdfunding Guidance: Stand out and attract the right investors.
Expert Crowdfunding Guidance: Stand out and attract the right investors.
Key Features
• Investor Network: Extensive network of accredited and institutional investors.
• Tech-Enabled: Issuance provides a robust platform for online investment processing and investor management.
• Marketing Services: The platform offers strategic marketing to attract accredited investors.
Fees
• Custom Pricing: Fees vary depending on the services provided.
• Upfront Costs: May include setup and marketing expenses.
• Success Fees: Negotiable based on campaign success.
Suitable Industries
Issuance is ideal for companies in real estate, healthcare, and tech that need access to accredited investors.
Platform #6: DealMaker
Overview
DealMaker’s strength is in its technology. Unlike the other platforms that centralize campaigns, DealMaker offers companies a white-label solution, meaning you can host your fundraising campaign directly on your own website. This gives you more control over branding and the user experience, but also shifts the responsibility of driving traffic to your campaign entirely onto your shoulders.
Key Features
• Total Capital Raised: Over $1.7 billion.
• Global Reach: Supports issuers across multiple countries.
• White-Label Solution: Allows companies to host investment processes on their own websites, giving full control over branding.
• Compliance Tools: Provides automated regulatory filings and investor accreditation verification.
Fees
• Subscription Model: Based on tiered pricing.
• Transaction Fees: May charge per-investor fees.
• Additional Costs: Companies must manage their own marketing and legal expenses.
Suitable Industries
DealMaker is suited for companies across a range of industries seeking full control over their fundraising campaigns, from technology to consumer products.
Key Considerations When Choosing a Platform
1. Regulatory Compliance: Ensure your platform of choice aligns with your fundraising goals under Reg CF, Reg A+, or Reg D.
2. Investor Audience: Decide whether your campaign is better suited for retail investors, accredited investors, or both.
3. Funding Goals: Choose a platform that can support your desired capital raise.
4. Fees and Costs: Assess both upfront fees and success fees to understand the true cost of raising funds.
5. Industry Focus: Select a platform with proven experience in your industry.
6. Marketing Support: Some platforms offer robust marketing services to help promote your campaign, while others leave marketing up to you.
7. Success Rates: Consider the success rates of platforms to increase your campaign’s likelihood of success.
Comparison Table
Here’s a detailed comparison table including success stories, success rates, and suitable industries.
Which Platform Is Right for You?
For Quick and Accessible Funding
• Wefunder is ideal for early-stage startups seeking quick access to capital with minimal barriers, especially in consumer-facing industries.
For High-Quality Offerings and Tech Startups
• Republic suits tech-focused companies that meet higher standards and are looking for robust marketing support and access to a diverse investor base.
For Larger Raises and Secondary Market Access
• StartEngine is appropriate for companies aiming for substantial raises and interested in offering investors liquidity through a secondary market.
For Significant Capital Raises in Mature Industries
• Dalmore Group is best for mature companies in industries like real estate and manufacturing seeking substantial capital and willing to manage their own marketing.
For Accredited Investor Campaigns in Tech and Real Estate
• Issuance is suitable for companies focusing on accredited investors in sectors like tech and real estate, requiring customized marketing and technology solutions.
For Full Control Over Fundraising Across Industries
• Deal Maker offers companies the ability to manage their own campaigns with advanced technology, ideal for those wanting full control across various industries.
Need More Capital for Your Business?
contact usExpert Crowdfunding Guidance: Stand out and attract the right investors.
Expert Crowdfunding Guidance: Stand out and attract the right investors.
Expert Crowdfunding Guidance: Stand out and attract the right investors.
Key Considerations for Founders
When choosing a platform, don’t just focus on surface-level metrics like success rates or total capital raised. Dig deeper:
- Pre-Launch Strategy: Platforms like Wefunder and Republic reward early momentum. Plan a soft launch to engage friends, family, and existing customers before going public.
- Investor Sophistication: Republic and Issuance investors tend to be more sophisticated and expect detailed due diligence reports. Make sure your campaign materials speak to a higher level of investor understanding.
- Post-Raise Liquidity: If investor liquidity is a priority, StartEngine’s secondary market may be the game-changer you need.
- Cost Efficiency: Dalmore’s upfront costs make it less suitable for early-stage companies, while Wefunder’s fee-waiver options make it ideal for startups without significant upfront capital.
- Customization vs. Hand-Holding: Deal Maker and Issuance offer high customization, but if you need more hands-on guidance, platforms like Republic and StartEngine offer more support services.
Navigating the equity crowdfunding landscape is complex, but understanding the insider strategies behind each platform can help you maximize your campaign’s success. Reach out if you’re interested in exploring which platform is the right fit for your business model and fundraising goals.
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