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Our most popular questions about Getting Started
Why invest in startups?
On StartEngine, you support startups and early-growth companies that you are passionate about. This is different from helping a company raise money on Kickstarter. You aren’t buying products or merch. You are buying a piece of a company and helping it grow. In time, you may make a profit on your investment if the company grows and becomes more successful, and your investment holdings become worth more.
What types of securities can I buy on StartEngine?
The majority of offerings on StartEngine are common stock, but some companies raise capital through convertible note, debt, and revenue share. You can invest in companies from all kinds of industries, from green tech to professional ultimate frisbee leagues.
How much can I invest?
With Regulation A+, a non-accredited investor can invest a maximum of 10% of their annual income or 10% of their net worth per year, whichever is greater.
With Regulation Crowdfunding, non-accredited investors with an annual income or net worth less than $124,000, are limited to invest a maximum of 5% of the greater of those two amounts. For those with an annual income and net worth greater than $124,000, the investor is limited to investing 10% of the greater of the two amounts.
There are no restrictions for accredited investors.
With Regulation Crowdfunding, non-accredited investors with an annual income or net worth less than $124,000, are limited to invest a maximum of 5% of the greater of those two amounts. For those with an annual income and net worth greater than $124,000, the investor is limited to investing 10% of the greater of the two amounts.
There are no restrictions for accredited investors.
How do I know if I am an accredited or non-accredited investor?
An accredited investor is a person who has a networth of at least $1 million (excluding their primary residence) or earns at least $200,000 in income consecutively for the two most recent years – $300,000 if combined with a spouse. A non-accredited investor is everyone else!
How do I calculate my net worth?
Calculating net worth involves adding up all your assets and subtracting all your liabilities. The resulting sum is your net worth. For examples, and more information about how to calculate your net worth, feel free to reference this SEC investor bulletin
Who can invest on StartEngine?
Anyone over 18 years of age can invest on StartEngine. However, if you are younger, a parent could invest in your name by setting up a UTMA or trust. To learn more about how much you can invest, please review the SEC Investor Bulletin.
Secondly, while we do not market in UK or Canada, or solicit investments from UK or Canada, we are aware that regulators from certain UK countries or Canadian provinces have raised questions with respect to sales to UK or Canadian investors, and are taking the view that merely accepting money from UK or Canadian investors is a transaction that they have jurisdiction over, and that such offerings have to comply with the UK or Canadian equivalent of registration of the offering, or find an available exemption. In light of this position, and in order to protect the companies who post their offering with us, we are not currently accepting investments from UK or Canadian investors. However, we can now accept accredited UK investors. Please reach out to contact@startengine.com if you have any other questions on whether or not you are able to invest.
Secondly, while we do not market in UK or Canada, or solicit investments from UK or Canada, we are aware that regulators from certain UK countries or Canadian provinces have raised questions with respect to sales to UK or Canadian investors, and are taking the view that merely accepting money from UK or Canadian investors is a transaction that they have jurisdiction over, and that such offerings have to comply with the UK or Canadian equivalent of registration of the offering, or find an available exemption. In light of this position, and in order to protect the companies who post their offering with us, we are not currently accepting investments from UK or Canadian investors. However, we can now accept accredited UK investors. Please reach out to contact@startengine.com if you have any other questions on whether or not you are able to invest.
What is the difference between Regulation Crowdfunding and Regulation A+?
Both Title III (Regulation Crowdfunding) and Title IV (Reg A+) help entrepreneurs crowdfund capital investments from unaccredited and accredited investors. The differences between these regulations are related to the investor limitations, the differing amounts of money companies are permitted to raise, and differing disclosure and filing requirements. To learn more about Regulation Crowdfunding, click here, and for Regulation A+, click here
Where can I find more financial information about a company?
All available financial information can be found on the campaign pages for both Regulation Crowdfunding and Regulation A+ offerings. You can find that information under the “Terms” tab.
Campaigns that are currently Testing the Waters are not required to display their finances until they go into live offering mode. If you have questions for a company, feel free to submit a comment in the “Comment” tab of their campaign page, and they will respond to you directly.
Campaigns that are currently Testing the Waters are not required to display their finances until they go into live offering mode. If you have questions for a company, feel free to submit a comment in the “Comment” tab of their campaign page, and they will respond to you directly.
What happens if a company does not reach their funding goal?
If a company does not reach their minimum funding goal, all funds will be returned to the investors within 10 business days after the closing of their offering.
If a company has reached their maximum funding goal, can I still invest?
If a company has reached their maximum funding goal, you can submit an “indication of interest.” An indication of interest is similar to a reservation. It’s a non-binding commitment that allows you to be placed on a waitlist for any offerings that are oversubscribed, meaning they have raised more than their maximum funding goal. This is not an investment and does not guarantee a place in the offering.
If your indication of interest is accepted, you will be notified to sign your binding agreement. You will have only 72 hours to sign the approved indication of interest. If you do not sign the agreement within 72 hours of being notified, you will be bumped to the bottom of the waitlist. If your binding agreement is pre-signed, the investment will automatically get pushed through once off the waitlist.
Can I cancel my indication of interest?
You can cancel your indication of interest at any time up until 48 hours before the target deadline. If you cancel your indication of interest, you will lose your place on the waitlist.
When will I become an investor in this offering?
You will not become an investor in this offering unless your indication of interest is accepted and pushed off the waitlist, and you sign your binding subscription agreement via email, within 72 hours of notification. There is not a defined timeframe, as to when/if your indication of interest will be accepted. StartEngine will only push investors through to the next phase if space becomes available in the round.
If your indication of interest is accepted, you will be notified to sign your binding agreement. You will have only 72 hours to sign the approved indication of interest. If you do not sign the agreement within 72 hours of being notified, you will be bumped to the bottom of the waitlist. If your binding agreement is pre-signed, the investment will automatically get pushed through once off the waitlist.
Can I cancel my indication of interest?
You can cancel your indication of interest at any time up until 48 hours before the target deadline. If you cancel your indication of interest, you will lose your place on the waitlist.
When will I become an investor in this offering?
You will not become an investor in this offering unless your indication of interest is accepted and pushed off the waitlist, and you sign your binding subscription agreement via email, within 72 hours of notification. There is not a defined timeframe, as to when/if your indication of interest will be accepted. StartEngine will only push investors through to the next phase if space becomes available in the round.
How do I contact the company (Regulation CF)?
To contact the company directly, please leave a comment for them on their campaign via the comments section and a member of their team will respond to you shortly. You can also reach out to them via their website.
I forgot my password. What do I do?
You can reset your password by clicking “Forgot Password”, which is located on the Login page below “Password.” Once you click “Forgot Password,” you will be asked to enter your email. After you enter your email and click “Submit,” we will send you further instructions.
Once the email arrives, please open it and click on the “Reset your password” link provided. You will then be prompted to enter a new password and confirm that password. After you do so, you will be logged in and redirected to the main StartEngine page. Once logged in, you will be able to reserve shares, follow companies, and/or invest.
Once the email arrives, please open it and click on the “Reset your password” link provided. You will then be prompted to enter a new password and confirm that password. After you do so, you will be logged in and redirected to the main StartEngine page. Once logged in, you will be able to reserve shares, follow companies, and/or invest.
What is the StartEngine Venture Club?
The StartEngine Venture Club is a bonus granted to certain StartEngine shareholders that allows them to earn a 10% bonus when investing in companies on StartEngine. Learn more about the Venture Club here.
How do I (un)subscribe to StartEngine's newsletters?
All StartEngine users are automatically subscribed to our newsletter. If you would like to sign up to be a part of the StartEngine community, please go to https://user.startengine.com to receive our newsletters, reserve shares and invest!
It is very easy to unsubscribe from any emails or company updates that you no longer want to receive. Every email that we send out has an unsubscribe link under the signature of the email. Simply click the link, and you will automatically be unsubscribed from these sorts of emails. You can also go into your settings and uncheck the boxes for notifications you no longer wish to receive.
Please also make sure to check your Watchlist that is located in your Portfolio. This means you are following the company, and will be emailed updates about them.
To manage your watchlist from a desktop you can follow these steps:
It is very easy to unsubscribe from any emails or company updates that you no longer want to receive. Every email that we send out has an unsubscribe link under the signature of the email. Simply click the link, and you will automatically be unsubscribed from these sorts of emails. You can also go into your settings and uncheck the boxes for notifications you no longer wish to receive.
Please also make sure to check your Watchlist that is located in your Portfolio. This means you are following the company, and will be emailed updates about them.
To manage your watchlist from a desktop you can follow these steps:
- Log in to your StartEngine account at: www.startengine.com
- Click on the person icon in the top right-hand corner
- Select "Portfolio"
- Click on "Watchlist" on the upper right hand corner of your portfolio
How do I deactivate my account?
To deactivate your account, please contact the Investor Experience team here or reach out via contact@startengine.com. We are sad to see you go!
How do I contact someone at StartEngine?
If you have questions that have not been answered in the FAQ, please reach out to us here. We will do our best to answer your questions as quickly as possible.
Our most popular questions about Investing
Is there any cost to investing?
Many offerings on StartEngine are completely free for investors, as StartEngine makes its money by charging fees to the company raising money. That being said, companies can opt to offset those costs by having investors pay a percentage in the form of a processing fee. This fee will be charged to investors on top of the price of shares. Your total amount charged and shares will be stated clearly on the investment form as a 3.5% processing fee.
If you are paying via a wire transfer, there may be additional fees charged by your bank related to the transfer of funds. In the event that you make a wire transfer, please be sure to talk to your banking institution about the fees involved, so that you can pay any additional transfer fees needed. ACH and credit card investments do not include additional fees but are still subject to the 3.5% fee above when applicable.
If you are paying via a wire transfer, there may be additional fees charged by your bank related to the transfer of funds. In the event that you make a wire transfer, please be sure to talk to your banking institution about the fees involved, so that you can pay any additional transfer fees needed. ACH and credit card investments do not include additional fees but are still subject to the 3.5% fee above when applicable.
Why do you require my social security number for some investments?
We understand your concern regarding the security of your Social Security Number. We ask for your SSN due to anti-money laundering regulations and fraud checks.
Our applications communicate with our servers using Transport Layer Security (TLS) protocol issued by DigiCert.
Our applications communicate with our servers using Transport Layer Security (TLS) protocol issued by DigiCert.
How can I pay for my investments?
On StartEngine, you can invest in four ways: Individually, as a self-directed IRA, as a Trust, or as an entity like a corporation or Limited Liability Company. If you are interested in learning more about what a self -directed IRA is, or how to convert your IRA to a self -directed IRA, click here.
We currently accept four forms of payment: Automated Clearing House (ACH), Credit Cards, and Wire Transfer. Please note: international investors can only pay through Credit Cards or Wire Transfer.
ACH Investments
ACH is an electronic network for financial transactions in the United States. An ACH transfer may be completed on the StartEngine website. Funds are only withdrawn from an investor’s account once a company has exceeded their minimum funding goal and escrow has been opened. Therefore, until this happens, the status of the investment will remain “not received.” Once the escrow account has been opened, the funds committed via ACH investments can take up to 3-4 business days for them to reach a company’s escrow account, and 10 days to clear once received.
If an ACH investment fails, you will be notified immediately with a link to update your payment information with a follow up email a few days later to confirm your payment information.
Credit Cards
Credit card investments are captured immediately after submission of the investment. Your credit card investment will be marked as “received” once the funds have been successfully received and credited to your investment (usually a few days after capture).
Wire Transfers
Wire transfers are completed outside of the StartEngine platform, meaning you will need to contact your bank independently to execute the transfer. In order to complete a wire, you need to bring the given wire instructions to your bank. We send three separate emails reminding you to execute a wire transfer. The emails are sent: after 1 week, after 10 days, and a final email after 14 days. Each email includes a link to view the wire transfer instructions to execute the wire transfer. Until you contact your bank and wire the funds, the status of your investment will remain “not received.”
We currently accept four forms of payment: Automated Clearing House (ACH), Credit Cards, and Wire Transfer. Please note: international investors can only pay through Credit Cards or Wire Transfer.
ACH Investments
ACH is an electronic network for financial transactions in the United States. An ACH transfer may be completed on the StartEngine website. Funds are only withdrawn from an investor’s account once a company has exceeded their minimum funding goal and escrow has been opened. Therefore, until this happens, the status of the investment will remain “not received.” Once the escrow account has been opened, the funds committed via ACH investments can take up to 3-4 business days for them to reach a company’s escrow account, and 10 days to clear once received.
If an ACH investment fails, you will be notified immediately with a link to update your payment information with a follow up email a few days later to confirm your payment information.
Credit Cards
Credit card investments are captured immediately after submission of the investment. Your credit card investment will be marked as “received” once the funds have been successfully received and credited to your investment (usually a few days after capture).
Wire Transfers
Wire transfers are completed outside of the StartEngine platform, meaning you will need to contact your bank independently to execute the transfer. In order to complete a wire, you need to bring the given wire instructions to your bank. We send three separate emails reminding you to execute a wire transfer. The emails are sent: after 1 week, after 10 days, and a final email after 14 days. Each email includes a link to view the wire transfer instructions to execute the wire transfer. Until you contact your bank and wire the funds, the status of your investment will remain “not received.”
How do I pay with a credit card?
It’s at the discretion of each company as to whether or not it accepts credit cards. You can always find out if a company accepts credit card payments by simply clicking “Invest Now” on a campaign and then clicking “Payment Method” to see if “Credit Card” is available.
Here are some important things to know about investing with a credit or debit card on StartEngine:
Here are some important things to know about investing with a credit or debit card on StartEngine:
- Your card will be charged immediately following the submission of your investment. Companies can disburse funds during their campaigns, as well as at the end. Therefore, your card might be charged immediately, but the company may not “disburse” (close on your funds), until a few days after, or perhaps months after you invest. It all depends on when the company chooses to withdraw funds.
- The name that will appear on your billing statement will read “STE*” or “STARTENGINE” followed by the first 15 characters of the company’s name
- There are no additional transaction fees on investments. The amount that you invest will be the amount that appears on your credit or debit card.
- You have up until 48 hours prior to a company’s disbursement of funds to cancel your investment for Reg CF investments. For Reg A+ investments, you have up to 48 hours from the time you submit your investment. The company will notify you of that disbursement (or of the close of its campaign) beforehand, and you have 48 hours from the time of that notification to cancel your Reg CF investment.
I submitted an investment, but how come no funds have been taken from my account?
If you have submitted an investment and funds have not yet been pulled from your account, there are a couple reasons that this might be the case:
- The company has exceeded their maximum funding goal and is oversubscribed. Investments are accepted on a first come, first serve basis, and can take some time to resolve. StartEngine will contact you directly with an update on your investment.
- The company has not yet reached its minimum funding goal, or their escrow account is not open. StartEngine only pulls funds from an investor’s account once the company has exceeded their minimum funding goal, and the escrow account has been opened. It normally takes less than 48 hours from when they reach their minimum funding goal.
- If you have chosen to pay via wire and have not yet received an email with the instructions, the company has not yet reached their minimum funding goal, or the escrow account is not open. You will receive the appropriate wire transfer instructions as soon as the company has exceeded their minimum funding goal and their escrow account has been opened.
Where can I find my wire instructions?
If the company has exceeded their minimum funding goal, you should have already received the wire instructions in your email. You can now simply click into the investment and there will be a “Wire instructions” button where you will be able to view all of the required wire instructions.
What is the "Error with your investment" notification?
If you have received an email that says “Error with your investment,” then that means there is information that needs to be verified before the investment can be processed.
- Login to your StartEngine account at: www.StartEngine.com
- Click your name in the top right-hand corner
- Click "My Portfolio"
- Click the Red "Action Required" beside your investment to see what information needs to be corrected
When and how will I get confirmation on my investment?
Once the company closes on your funds, you will receive a confirmation email from the company with details about your investment, along with a copy of your subscription agreement with a record of your shares. Depending on when the company requests a disbursement (close on funds), this could be a few weeks, or months, after the original investment was submitted.
Your shares are owned as “book-entry,” which is how most stocks are issued today. It means that you do not get a physical stock certificate, and instead, shares are held via electronic record by the issuing company’s transfer agent. The benefit of electronic book-entry shares is that it minimizes the costs and problems of lost or missing certificates, which can be overwhelming for companies to manage.
Your shares are owned as “book-entry,” which is how most stocks are issued today. It means that you do not get a physical stock certificate, and instead, shares are held via electronic record by the issuing company’s transfer agent. The benefit of electronic book-entry shares is that it minimizes the costs and problems of lost or missing certificates, which can be overwhelming for companies to manage.
When will I get my shares?
At the close of an offering, all investors whose funds have “cleared” by this time will be included in the disbursement. At this time, each investor will receive an email from StartEngine with their Countersigned Subscription Agreement, which will serve as their proof of purchase moving forward.
Please keep in mind that a company can conduct a series of “closes” or withdrawals of funds throughout the duration of the campaign. If you are included in that withdrawal period, you will be emailed your countersigned subscription agreement and proof of purchase immediately following that withdrawal.
Please keep in mind that a company can conduct a series of “closes” or withdrawals of funds throughout the duration of the campaign. If you are included in that withdrawal period, you will be emailed your countersigned subscription agreement and proof of purchase immediately following that withdrawal.
What does the error message "exceeded your TIII limit" mean?
If you are getting this error message, it means that you have exceeded the amount that you are allowed to invest during a 12-month period.
StartEngine allows both accredited and non-accredited investors to invest. However, for non-accredited investors, those whose annual income or net worth is less than $124,000, are limited to the greater of $2,500 or 5% of the lesser, of the investor’s annual income or net worth.
If the annual income and net worth of the investor are both greater than $124,000, the investor can invest up to 10% of their annual income or net worth, to an annual maximum of $124,000. To learn more about your investing limitations and the regulations, please refer to the SEC Investor Bulletin here.
StartEngine allows both accredited and non-accredited investors to invest. However, for non-accredited investors, those whose annual income or net worth is less than $124,000, are limited to the greater of $2,500 or 5% of the lesser, of the investor’s annual income or net worth.
If the annual income and net worth of the investor are both greater than $124,000, the investor can invest up to 10% of their annual income or net worth, to an annual maximum of $124,000. To learn more about your investing limitations and the regulations, please refer to the SEC Investor Bulletin here.
Our most popular questions about Portfolio Managment
What will the return on my investment be?
StartEngine assists companies in raising capital, and once the offering is closed, we are no longer involved with whether the company chooses to list shares on a secondary market, or what occurs thereafter. Therefore, StartEngine has no control or insight into your investment after the close of the live offering. In addition, we are not permitted to provide financial advice. You may want to contact a financial professional to discuss possible investment outcomes.
Can I sell my shares?
Once the live offering has closed, you may choose how to handle your shares. You will have to contact the company’s selected transfer agent, which is the cap table management service, who will be responsible for the transfer of your shares after the close of the offering.
Companies may choose to apply to quote their securities on our trading marketplace StartEngine Marketplace. StartEngine Marketplace is one of the first markets in the US where non-accredited investors can publicly trade investments that have raised capital via Regulation Crowdfunding and Regulation A+. StartEngine Marketplace is an alternative trading system regulated by the SEC and operated by StartEngine Primary, LLC, a broker dealer registered with the SEC and FINRA.
The shares sold via Regulation A+ offerings are unrestricted and can be sold freely immediately after purchase. However, the shares sold via Regulation Crowdfunding offerings have a one-year lock up period before those shares become unrestricted and can be sold freely.
Investors are generally restricted from reselling shares for a one-year period after they were issued, unless the shares are transferred:
Companies may choose to apply to quote their securities on our trading marketplace StartEngine Marketplace. StartEngine Marketplace is one of the first markets in the US where non-accredited investors can publicly trade investments that have raised capital via Regulation Crowdfunding and Regulation A+. StartEngine Marketplace is an alternative trading system regulated by the SEC and operated by StartEngine Primary, LLC, a broker dealer registered with the SEC and FINRA.
The shares sold via Regulation A+ offerings are unrestricted and can be sold freely immediately after purchase. However, the shares sold via Regulation Crowdfunding offerings have a one-year lock up period before those shares become unrestricted and can be sold freely.
Investors are generally restricted from reselling shares for a one-year period after they were issued, unless the shares are transferred:
- to the company that issued the securities
- to an accredited investor
- to a family member (defined as a child, stepchild, grandchild, parent, stepparent, grandparent, spouse or spousal equivalent, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships.)
- in connection with your death or divorce or other similar circumstance
- to a trust controlled by you or a trust created for the benefit of a family member; as part of an offering registered with the SEC.
How do I view my subscription agreement?
You can view your signed subscription agreement by logging into your StartEngine account.
- Once you are logged in, hover over the person icon in the top right-hand corner of the page
- Select "Portfolio"
- In the bottom right corner of your Portfolio, select "All Transactions/Past Transactions" under "ALL HISTORY"
- Find the investment you're inquiring about and select it
- Click on the "Subscription Agreement" to download your ownership documents
How do I cancel my investment?
For Regulation Crowdfunding, investors are able to cancel their investment at any point throughout the campaign up until 48 hours before the closing of the offering. Note: If the company does a rolling close, they will post an update to their current investors, giving them the opportunity to cancel during this timeframe. If you do not cancel within this 5-day timeframe, your funds will be invested in the company, and you will no longer be able to cancel the investment. If your funds show as ‘Fully Invested’ on your account dashboard, your investment can no longer be cancelled.
For Regulation A+, StartEngine allows for a 48 hour cancellation period. Once the 48 hour window from when the investment was submitted has passed, it is up to each company to set their own cancellation policy. You may find the company’s cancellation policy in the company’s offering circular.
Once your investment is canceled, there is a 10-day clearing period (from the date your investment was submitted). After your funds have cleared the bank, you will receive your refund within 10 business days.
Refunds that are made through ACH payments can take up to 10 business days to clear. Unfortunately, we are at the mercy of the bank, but we will do everything we can to get you your refund as soon as possible. However, every investment needs to go through the clearing process in order to get sent back to the account associated with the investment.
For Regulation A+, StartEngine allows for a 48 hour cancellation period. Once the 48 hour window from when the investment was submitted has passed, it is up to each company to set their own cancellation policy. You may find the company’s cancellation policy in the company’s offering circular.
Once your investment is canceled, there is a 10-day clearing period (from the date your investment was submitted). After your funds have cleared the bank, you will receive your refund within 10 business days.
Refunds that are made through ACH payments can take up to 10 business days to clear. Unfortunately, we are at the mercy of the bank, but we will do everything we can to get you your refund as soon as possible. However, every investment needs to go through the clearing process in order to get sent back to the account associated with the investment.
How do I change or cancel my reservation?
In order to change your reservation amount, you would need to cancel your current reservation, and then resubmit a new reservation. To cancel your reservation, please follow the steps below:
- Login to your StartEngine account at: www.startengine.com/login
- Click your name in the top right corner
- Click "Portfolio"
- Click into the reservation and click the “Cancel” button
How do I view my investment status?
You can check on your investment status by following the directions below:
Different stages of investments:
Order Submitted (Pending Funds Arrival): The investment was submitted and we are waiting for the funds to arrive in escrow.
Payment Processing: The Funds have been received and our banking partner is working to verify your information.
Funds in Escrow: Your funds have been received and the information was verified. Your funds will remain in a secure escrow account until the company issues its next batch of shares.
Investment Complete: The company has withdrawn your funds from escrow and you are now officially invested. Your ownership documents will be emailed to you upon the finalization of your investment.
- Log in to your StartEngine account at: www.startengine.com
- Click on the person icon in the top right-hand corner
- Select "Portfolio"
- Your most recent orders will be located under "Open Transactions." Please note that your investment amount will update once your investment status changes to "Fully Invested." Please note some of your investments will be under "Positions" below the "Investments" Section
Different stages of investments:
Order Submitted (Pending Funds Arrival): The investment was submitted and we are waiting for the funds to arrive in escrow.
Payment Processing: The Funds have been received and our banking partner is working to verify your information.
Funds in Escrow: Your funds have been received and the information was verified. Your funds will remain in a secure escrow account until the company issues its next batch of shares.
Investment Complete: The company has withdrawn your funds from escrow and you are now officially invested. Your ownership documents will be emailed to you upon the finalization of your investment.
How do my investments affect my taxes?
StartEngine cannot give you any tax or investment advice. You may want to consult a tax advisor regarding your investment and any questions regarding your taxes as an investor. However, we can provide you with some useful information on how it may affect you for the upcoming tax year.
Tax liability is largely determined by what type of entity you invested in. There are two types of entities, which you may have invested in. You invested in either a C corporation or an LLC. You can find the specific entity type on each company’s Form C, which is accessible through the companies “Terms” section on their campaign page.
What happens if you invested in a C-corporation?
Generally speaking, U.S. investors investing in C-corporations on StartEngine will only need to report income when they realize a gain or loss for tax purposes. In these instances, no K-1 is owed to you. You would however need a K-1 if you invest in an LLC on StartEngine. In that case, the company you invested in will provide you with the required documents. StartEngine will not be sending any of these tax forms to you.
What if the company you invested in goes bankrupt?
The company or its trustee is responsible for providing tax documents directly to their investors, to reflect any loss. If you cannot obtain documents, please reach out to a tax professional.
What if I sold the security I acquired on StartEngine in a private transaction and realized a gain?
Once an investor sells a capital asset, and realizes a gain, the capital gain is taxable.
What if I sold the security I acquired on StartEngine in a private transaction and realized a loss?
Once you sell a capital asset, at a loss, this qualifies as a capital loss and can be used to offset capital gains.
Tax liability is largely determined by what type of entity you invested in. There are two types of entities, which you may have invested in. You invested in either a C corporation or an LLC. You can find the specific entity type on each company’s Form C, which is accessible through the companies “Terms” section on their campaign page.
What happens if you invested in a C-corporation?
Generally speaking, U.S. investors investing in C-corporations on StartEngine will only need to report income when they realize a gain or loss for tax purposes. In these instances, no K-1 is owed to you. You would however need a K-1 if you invest in an LLC on StartEngine. In that case, the company you invested in will provide you with the required documents. StartEngine will not be sending any of these tax forms to you.
What if the company you invested in goes bankrupt?
The company or its trustee is responsible for providing tax documents directly to their investors, to reflect any loss. If you cannot obtain documents, please reach out to a tax professional.
What if I sold the security I acquired on StartEngine in a private transaction and realized a gain?
Once an investor sells a capital asset, and realizes a gain, the capital gain is taxable.
What if I sold the security I acquired on StartEngine in a private transaction and realized a loss?
Once you sell a capital asset, at a loss, this qualifies as a capital loss and can be used to offset capital gains.
Our most popular questions about Trading On Marketplace
What is StartEngine Marketplace?
StartEngine Marketplace is our investor trading platform. StartEngine Marketplace is an Alternative Trading System (ATS) registered with the SEC and operated by StartEngine Primary, LLC (our wholly-owned broker-dealer subsidiary).
An ATS is an electronic trading system that matches orders for buyers and sellers of securities. It allows investors to trade shares purchased through Regulation A+, Regulation Crowdfunding or Regulation D for companies quoted on Marketplace.
An ATS is an electronic trading system that matches orders for buyers and sellers of securities. It allows investors to trade shares purchased through Regulation A+, Regulation Crowdfunding or Regulation D for companies quoted on Marketplace.
What companies will trade on StartEngine Marketplace?
StartEngine Marketplace is available to companies that have previously raised funding on StartEngine and SeedInvest, which we acquired. In the near future, it is possible that companies that have raised capital via Regulation Crowdfunding and Regulation A+ on other equity crowdfunding platforms will be able to trade on Marketplace. We may even introduce other assets besides shares in companies. Please note, not every company, even StartEngine based, will be available to trade on Marketplace at this time.
Who can trade on StartEngine Marketplace?
U.S. residents over 18 years old can open an Investment Account. A U.S. bank account, a U.S. address, and a U.S. phone number are required to access StartEngine Marketplace.
How does Marketplace work?
Marketplace allows investors to trade with each other in a peer-to-peer marketplace. Sellers can post offers to sell a specific number of shares by setting a minimum price. Buyers can post offers to buy a specific number of shares by setting maximum price. If a match is made, then the trade is executed. See below for more details.
How much does it cost?
For Companies: To learn more about the costs associated with listing on StartEngine Marketplace, please contact contact@startengine.com.
For Investors: Opening an investment account for Marketplace is free, but we do require a Venture Club subscription to trade. All transactions must be for a minimum value of $250 plus a 3.5% fee for buyers and a 5% fee for sellers.
For Investors: Opening an investment account for Marketplace is free, but we do require a Venture Club subscription to trade. All transactions must be for a minimum value of $250 plus a 3.5% fee for buyers and a 5% fee for sellers.
How do I access StartEngine Marketplace?
You can access StartEngine Marketplace at https://marketplace.startengine.com/. You will need to open an Investment Account if you have not already in order to access the platform.
What hours can I trade?
Investors can place orders on StartEngine Marketplace at any time. However, each stock trading on StartEngine's Rapid Marketplace will have market hours. Market hours are the times at which our matching engine will match orders with each other. The market hours for the Rapid Marketplace will be 1pm-3pm ET / 10am-12pm PT Monday-Friday.
What types of orders can I place on StartEngine Rapid Marketplace?
Users can place limit orders 24/7, and clearing (matching limit orders) will only occur during market hours. We plan to add market orders at a future date, as well as other order types.
How do I submit an order on StartEngine Marketplace?
Please follow these instructions to submit a sell offer:
Please follow these instructions to buy shares on Marketplace:
- Search Your Company - Use the search bar or tabs to get started.
- Make Your Sell Offer - Once you’ve found your company, click “Sell” to enter the share price and number of shares you're offering.
- Offer Live - When the time comes, we’ll ask for proof that you own the shares you’re selling; after a review (typically 1 business day), your offer goes live.
Please follow these instructions to buy shares on Marketplace:
- Find a Sell Offer - Browse recent “Offers to Sell” or explore over 6,000 companies using the search bar or tabs.
- Accept - You can accept to buy some or all of the shares listed in an offer; we’ll then confirm the transaction (typically up to 30 business days).
- Get Shares - Once confirmed, the shares are transferred to you!
How long will it take for my trade to be executed?
Trade orders will only be executed during market hours for the security you wish to trade. For example, the market hours for StartEngine shares are Monday-Friday, 1pm-3pm ET / 10am-12pm PT. Trade orders expire after each day’s market hours. If your order is not cleared in that window, then you will need to resubmit your trade order again. If you have trouble finding a buyer or seller for your order, try adjusting your asking price!
Why was only part of my order filled?
We were able to fill part of your order at your desired price, but there wasn’t enough demand to meet your entire offer before your order expired. Trade orders are filled based on a few criteria. In order of priority, those are the asking price, the time the order was submitted, and then finally the size of the order. Try submitting the rest of your order another day or adjusting your asking price to fill the rest of your original order.
Can I cancel my order and get a refund?
You can cancel your order at any time before the order is matched by Marketplace. After an order is matched, there is no possibility of a cancellation or a refund.
Note: if your order is partially filled, you will be unable to cancel the rest of our order. Your order will remain open until it expires at the end of the day. We are working to provide this ability in future updates. Thank you for your patience.
Note: if your order is partially filled, you will be unable to cancel the rest of our order. Your order will remain open until it expires at the end of the day. We are working to provide this ability in future updates. Thank you for your patience.
Who cannot trade on StartEngine Marketplace?
At this time, employees of StartEngine Crowdfunding and their households are ineligible to trade on StartEngine Marketplace as are “insiders”, as defined by the SEC. An “insider” is an individual that is a director, senior officer, entity, or individual that owns more than 10% of the publicly available shares. Similarly, at this time, employees of other companies trading on StartEngine Marketplace can’t trade on StartEngine.
Individuals must not be, nor have an immediate family member residing in the same household, employed by or associated with any of the following: a broker-dealer, stock exchange, the Financial Industry Regulatory Authority (FINRA) or other financial institution.
Individuals must not be, nor have an immediate family member residing in the same household, employed by or associated with any of the following: a broker-dealer, stock exchange, the Financial Industry Regulatory Authority (FINRA) or other financial institution.
Are there US state restrictions for trading on StartEngine Marketplace?
Each security may have slightly different state rules. Investors in most states will not have any issues trading on StartEngine Marketplace. However, some states have restrictions. Here is an example of what those restrictions look like for a specific security:
StartEngine shares are eligible to trade in all 50 states and both territories, with the following exceptions: investors in the states of Alabama, Kentucky, Montana, Pennsylvania, & Virginia are limited to 3 sell transactions per year across all securities eligible to trade (but investors are able to buy as much as they want).
If you have questions about the restrictions of a specific security, reach out to us at contact@startengine.com
StartEngine shares are eligible to trade in all 50 states and both territories, with the following exceptions: investors in the states of Alabama, Kentucky, Montana, Pennsylvania, & Virginia are limited to 3 sell transactions per year across all securities eligible to trade (but investors are able to buy as much as they want).
If you have questions about the restrictions of a specific security, reach out to us at contact@startengine.com
Are there market makers?
There are no market makers on StartEngine Marketplace. A market maker is a participant or a company that actively buys and sells securities (in a National Market System) on both sides of the market in order to provide liquidity while profiting from the difference in the buy (“bid”) and sell (“ask”) spread.
How does StartEngine Marketplace work for Regulation Crowdfunding Companies?
Securities purchased in a Regulation Crowdfunding transaction cannot be resold for one year. This means that investors cannot sell their shares that they purchased in a Regulation Crowdfunding offering on Marketplace for one full year from the time of the initial investment if a company has signed a quotation agreement and is in good standing.
Thus, StartEngine Marketplace is an option for Regulation Crowdfunding Companies 1 year after their offering and initial issuance of those securities, however, they must meet StartEngine’s listing requirements, which center around # of investors, valuation, total assets, and a sufficient number of available shares.
Thus, StartEngine Marketplace is an option for Regulation Crowdfunding Companies 1 year after their offering and initial issuance of those securities, however, they must meet StartEngine’s listing requirements, which center around # of investors, valuation, total assets, and a sufficient number of available shares.
How does StartEngine Marketplace work for Regulation A+ Companies?
Regulation A+ offerings do not have the same limitations as Regulation Crowdfunding offerings. StartEngine Marketplace will initially be available for Regulation A+ offerings and issuances (shares issued in the offering) immediately. If a company agrees to be quoted on Marketplace, they’ll be able to announce that their shares will become immediately tradable upon the close of their campaign.
Should I invest now or later? Should I buy this?
We cannot provide investment or financial advice. We are only able to help with issues related to the platform. If you have questions about investments or returns, please contact an investment professional for advice.
Our most popular questions about Investment Accounts
What is an Investment Account (and why do I need one)?
Your Investment Account is what will allow you to hold funds and trade on StartEngine Marketplace. We require all users to open an Investment Account (which is part of, but separate from, your StartEngine Account). All funds in your Investment Account will be held by StartEngine Primary, LLC.
How long does it take to open and fund my Investment Account?
Timing can vary, but for most users, the process to open an account can be under a few minutes; however, it can take up to 10 business days if your account requires more documentation to verify. Funding your account can take up to 10 business days.
Why do you require so much information?
We require personal information due to banking regulation.
We also require you to complete a suitability questionnaire to make sure your financial goals are in line with your investments.
We also require you to complete a suitability questionnaire to make sure your financial goals are in line with your investments.
Can I open an Investment Account as a Trust or an IRA account?
Yes! We offer individual, company, joint, trust, and IRA accounts now.
How do I transfer funds to my account?
Once you open your Investment account, you can transfer funds from your bank. The name on the account you are transferring funds from should match the name on your Investment Account.
Can I use my Investment Account to invest on StartEngine.com?
You can use your investment account to deposit funds and use it for investing! The total amount in account has to be equal to or more than what you are trying to invest in.
Why is my Investment Account pending?
If a red error shows in your Investment Account, please see if you can update your information within your account. If no error shows, or your account requires manual review, please reach out to contact@startengine.com
How do I withdraw funds from my account?
You can withdraw funds from your Investment Account at any time after a 10 day waiting period (from the time of your initial transfer). Your withdrawal cannot exceed the funds available and the funds pending use in your account. Under certain conditions, you may be required to provide additional information for security purposes.
How do I change the bank account associated with my Investment Account?
To manage your payment methods on your dashboard, please go to your “Banking” tab on your portfolio or click here:
- Click "edit."
- Click "remove" on the payment method of your choice.
- Click "add" to add a new payment method.

