Get iOS App Sign Up
October 6, 2022 | 4 Min Read

Equity Crowdfunding by the Numbers: Q3 ’22

Equity Crowdfunding by the Numbers: Q3 '22

Equity Crowdfunding by the Numbers: Q3 ’22

The final numbers for Q3 are in, and per KingsCrowd*, equity crowdfunding platforms rounded out the quarter in September with an additional $30.7M in Reg. CF and $17.1M in Reg. A+ commitments. All told, that brings the industry to a grand total of $154M raised in Q3.

Big number, we know. Even more exciting (at least for us) – per the report, StartEngine ranked among the front of the pack. In Q3, we posted a total of $41.8M raised between Reg. CF and Reg. A+ offerings combined. That puts us ahead of Wefunder’s raise total by a whopping 28% and ahead of Republic’s numbers by an astonishing 139%.

*Source = https://kingscrowd.com/markets/. Please note a KingsCrowd Edge Subscription is required to access this report. The report only includes platforms selected by KingsCrowd and excludes real estate- and collectibles-only platforms, as well as Reg. D offerings and all raises limited to accredited investors.

Q3 Raise Totals via Reg. CF & Reg. A+ Combined*:

StartEngine

$41.8M

Wefunder

$32.7M

Republic

$17.4M

*Source = https://kingscrowd.com/markets/. Please note a KingsCrowd Edge Subscription is required to access this report.

StartEngine Q3 Milestones:

Industries climbing the funding ladder in Q3:

Though Real Estate & Construction businesses saw the most funding growth (to the tune of nearly $10M more dollars raised YoY), the Food & Beverage industry closed Q3 at the top of the leaderboard. At just over $24.3M in Reg. CF and Reg. A+ commitments, Food & Beverage companies accounted for more than 15% of all funds raised in the quarter. SaaS businesses also saw significant funding growth, with raise totals up $4.5M YoY.

Q3 Winners by combined funding total of Reg. CF & Reg. A+*:

Industry

Q3 ’22

Q3 ’21

Food & Beverage

$24.3M

$10.1M

Real Est. & Constr.

$19.8M

$10.1M

SaaS

$15.1M

$11.0M

*Source = https://kingscrowd.com/markets/. Please note a KingsCrowd Edge Subscription is required to access this report.

The Rise of Investor Perks

Clocking in at 569*, September saw a near record number of regulation crowdfunding offerings. The number of investors in the space has reached new heights too, with StartEngine’s investor community alone on the cusp of 1 million users. And as equity crowdfunding becomes ever more mainstream, a growing number of companies have turned to investor perks to entice a larger field of would-be backers.

Per a recent report, the number of businesses offering early-bird discounts to investors grew nearly 10X from just 20 to 198 from 2020-2021. Meanwhile, StartEngine’s Owner’s Bonus subscription – which offers members 10% bonus shares of participating raises – now comprises over 95% of the companies fundraising on our platform. YoY, membership has also grown 178%.

That’s good news for investors, of course, but there’s a lot of upside for founders too. For starters, perks can be a great way to build early momentum, which can have compounding effects later in the raise. As an example, on StartEngine, companies who attract 100 new investors to the platform in the first 30 days of their offer can qualify for additional email marketing. And that can mean a lot of extra oomph behind a raise.

Though some founders may feel concerned about dilution from perks, in practice it’s often minimal. Take StartEngine Owner’s Bonus for instance: Say a company raises $1M with a $10M pre-money valuation (i.e. not including the amount of the raise). On its own, that constitutes $1M / $11M = 9.1% dilution. Now, assume 100% of investors also participate in the Owner’s Bonus program (hey, we can dream) – that works out to $1.1M / $11M = 10% dilution. That’s a difference of less than 1%.

As we see it, widespread adoption of investor perks helps drive a virtuous cycle for equity crowdfunding. Pushed by volatility in public markets and receding VC funding levels, investors and entrepreneurs alike are entering the space in ever-growing numbers. At the same time, innovative tools, like investor perks, can boost equity for backers while leading to stronger outcomes for founders. And that is good news for all involved.

*Source = https://kingscrowd.com/markets/. Please note a KingsCrowd Edge Subscription is required to access this report.

Want to stay up to date with the latest posts from StartEngine? Sign up here:

You May Also Like

Important Message

IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE ISSUER AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. INVESTMENTS ON STARTENGINE ARE SPECULATIVE, ILLIQUID, AND INVOLVE A HIGH DEGREE OF RISK, INCLUDING THE POSSIBLE LOSS OF YOUR ENTIRE INVESTMENT.

www.StartEngine.com is a website owned and operated by StartEngine Crowdfunding, Inc. (“StartEngine”), which is neither a registered broker-dealer, investment advisor nor funding portal.

Unless indicated otherwise with respect to a particular issuer, all securities-related activity is conducted by regulated affiliates of StartEngine: StartEngine Capital, LLC, a funding portal registered here with the US Securities and Exchange Commission (SEC) and here as a member of the Financial Industry Regulatory Authority (FINRA), or StartEngine Primary, LLC, a broker-dealer registered with the SEC and FINRA / SIPC. You can review the background of our broker-dealer and our investment professionals on FINRA’s BrokerCheck here. StartEngine Secondary is an alternative trading system regulated by the SEC and operated by StartEngine Primary, LLC, a broker dealer registered with the SEC and FINRA.

Investment opportunities posted and accessible through the site are of three types:

1) Regulation A offerings (JOBS Act Title IV; known as Regulation A+), which are offered to non-accredited and accredited investors alike. These offerings are made through StartEngine Primary, LLC (unless otherwise indicated). 2) Regulation D offerings (Rule 506(c)), which are offered only to accredited investors. These offerings are made through StartEngine Primary, LLC. 3) Regulation Crowdfunding offerings (JOBS Act Title III), which are offered to non-accredited and accredited investors alike. These offerings are made through StartEngine Capital, LLC. Some of these offerings are open to the general public, however there are important differences and risks.

Any securities offered on this website have not been recommended or approved by any federal or state securities commission or regulatory authority. StartEngine and its affiliates do not provide any investment advice or recommendation and do not provide any legal or tax advice with respect to any securities. All securities listed on this site are being offered by, and all information included on this site is the responsibility of, the applicable issuer of such securities. StartEngine does not verify the adequacy, accuracy or completeness of any information. Neither StartEngine nor any of its officers, directors, agents and employees makes any warranty, express or implied, of any kind whatsoever related to the adequacy, accuracy, or completeness of any information on this site or the use of information on this site. See additional general disclosures here.

By accessing this site and any pages on this site, you agree to be bound by our Terms of Use and Privacy Policy, as may be amended from time to time without notice or liability.

Canadian Investors

Investment opportunities posted and accessible through the site will not be offered to Canadian resident investors.

Potential investors are strongly advised to consult their legal, tax and financial advisors before investing. The securities offered on this site are not offered in jurisdictions where public solicitation for offerings is not permitted; it is solely your responsibility to comply with the laws and regulations of your country of residence.

California Investors Only – Do Not Sell My Personal Information (800-317-2200). StartEngine does not sell personal information. For all customer inquiries, please write to contact@startengine.com.

StartEngine’s Reg A+ offering is made available through StartEngine Crowdfunding, Inc. This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment. For more information about this offering, please view StartEngine’s offering circular and risks associated with this offering.

Invest in StartEngine

190% YoY Growth: Invest in the leading equity crowdfunding platform.

This Reg A+ offering is made available through StartEngine Crowdfunding, Inc. This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment. For more information about this offering, please view StartEngine’s offering circular and risks associated with this offering.

 

Kevin O’Leary is a paid spokesperson for StartEngine. Read the 17(b) disclosure here.

Founder's Summit Application