SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

   Technology StocksEquity Crowdfunding


Previous 10 
To: Glenn Petersen who wrote (27)11/4/2020 10:32:22 PM
From: Thehammer
   of 37
 
Hi Glenn,

Thanks for posting this. I did receive the following from StartEngine who has been advocating for the changes.
They summarized as follows:

Increasing the maximum amount companies can raise from $1.07M to $5M.Amending the investment limits for investors by 1) removing investment limits for accredited investors and

2) using the greater of their annual income or net worth when calculating the investment limits for non-accredited investors.

Extending Reg CF's COVID-relief measures for an additional 18 months.


Permitting “test-the-waters” communications, which allows issuers to solicit interest from investors prior to filing the offering documents and can help issuers determine which exemption (Regulation Crowdfunding or A+) to use.
Permitting “demo day” communications that would not be deemed general solicitation or general advertising.
Permitting Special Purpose Vehicles in Regulation Crowdfunding offerings.

Also will note that Kevin O'leary of Shark Tank fame has taken a position and is a paid shill for StartEngine. Just recently started a secondary market for these securities although the only one trading currently is StartEngine. They plan to add more but there are quite a few operational hurdles to trading these securities.

Share RecommendKeepReplyMark as Last Read


From: Thehammer12/20/2020 6:26:51 PM
   of 37
 
It would be nice if we could get more people interested in this thread. I will respond to the questions posed and perhaps add a few closing thoughts:



If you are into equity crowdfunding, I will be glad if you can help me solve this misery.

· What made you venture into equity crowdfunding?


I was happenstance that I found the Start Engine website 3 years ago. I worked my entire career in Financial Services and was precluded from participating in any IPOs. In some regards this is better than IPO’s in that you are getting in before the company goes public. That also presents another set of risks including liquidity and potential loss of entire investment (that seems on par with many Biotech’s…)

One of the first investments that I made was into StartEngine itself. Founded by Howard Marks a cofounder of Activision and a recent investor / advisor is Mr. Wonderful of Shark Tank fame. I was in 2 years before him.

StartEngine has also started a secondary market for issues purchased on their platform but the only security trading thus far is StartEngine.

· On what basis did you choose your equity crowdfunding platform?

Most of my investments, have been on StartEngine but have done some others on WeFunder. There are several other platforms, but I have not investigated any others. I was extremely impressed with Howard Marks and I think he is the type to help drive the whole industry forward.

· How did you choose your investments?

Good question…I typically take a close look at the campaigns that have attracted the most capital AND those that happen to catch my eye. Also, if a company does well, they often come back for additional funding rounds and I often invest in subsequent tranches. My recent investmnets have included:

Knightscope – accompany that provides robotic security and associated software. A recent innovation was adding the ability to take temperatures. Many patents and robots already sold into multiple venues. Company has received quite a bit of positive press Knightscope | StartEngine

Hypersciences – company has a number of patents and working with mining / drilling leaders. They have patented a technology that drills up to 5 times faster than conventional means by utilizing supersonic “guns” to break apart the rock. Supposedly environmentally friending and aimed squarely at Geothermal energy. HyperSciences | StartEngine

Jet Token – “Jet Token is a private jet membership and booking platform for the ultra-modern age of aviation. For the first time, you will be able to use one app to book a private jet, a commercial airline ticket or both, all on the same itinerary.” Jet Token, Inc | StartEngine

Parallel Flight Technologies – “We’ve created patent-pending drone technology that will allow drones to carry heavy payloads for over two hours. This will make it ideal for use in fighting wildfires, search and rescue, and logistics missions. Our unmanned, autonomous aircraft open new possibilities for the safety of first responders and many other commercial applications.

Parallel Flight Technologies | StartEngine

Liquid Piston – “develops advanced rotary internal combustion engines based on the company’s patented thermodynamic cycle and novel rotary engine architecture. Our engines are compact, powerful, quiet, efficient, low-vibration, multi-fuel capable and scalable from 1HP to over 1000 HP. LiquidPiston | StartEngine

Many more – total over 40….





· Were you not scared that Startups have a high failure rate and you could lose every penny of your initial investment?

Yes, but I take a portfolio approach and spread the money around. It is seed money and I can afford to lose it all. However, I also invest in the Biotech market and use the same approach. Spread the money around. Many don’t pan out but a few home runs pay for the rest and then some.

· I know that Startup financials may not be transparent at times. Were you not scared as an investor that you had no in-depth auditing of what you were funding?

Yes, that is another concern, but I have also had lsuited companies that have had major accounting issues. There seems to be quite a few investors who are astute technically and financially and I tend to read the questions and answers. Some of the companies will also host calls and I usually ask a few questions.

· There is also a tenacity that estimated valuations on some startups might be wrong, meaning investments in them are priced at “estimated fair values.” These best-guess estimates may not reflect the actual amount that would be realized in a sale. How did you overcome this?

This is one of the main reasons that I would like to see the topic widely addressed here on SI. We have lots of experts and great minds if people are willing to weigh in. Personally [CH1] , I see this as a great opportunity, better in many respects than IPO. It is a good vehicle for investors but also good for people trying to raise capital in that investors are often clients and the corporation does not have to give up too much control to angel investors.

In the current market, I suspect that many listed securities are vastly overpriced.


· Did you prepare mentally, emotionally and financially to lose your entire investment in a particular funded startup?

I have invested for over 40 years and most of my investments are in DGI stocks. I have though had entire investmnets go belly up and again that is why I take a portfolio approach to investing. This is a very risky arena, but potentially a lucrative one as well. There is an obvious risk reward potential. I try to understand management especially if they have successfully launched other businesses and have a well-rounded team. Is it a concept that I believe makes sense? What is the market potential?

Other comments / concerns:

From the questions on the threads, it is apparent that many investors are unsophisticated. Since I have dealt with regulators in the past, there is potential for regulatory crackdown. The SEC though recently expanded the program and raised some investment limits.

I loved watching Shark Tank and this is an opportunity to be a mini-shark. It also could be lucrative if you invest in a company that eventually IPOs. I believe that Knightscope and StartEngine have the potential.








Share RecommendKeepReplyMark as Last Read


From: Thehammer12/21/2020 10:26:53 PM
   of 37
 
Howard Marks and Kevin O' Leary on raising capital in todays environment:


Share RecommendKeepReplyMark as Last Read


From: Thehammer12/22/2020 1:19:19 PM
   of 37
 
I threw a few bucks at this one.

Solar Roadways® | StartEngine

It was oversubscribed in over 24 hours. Company has been around for quite some time and has been making steady progress' From their overview:

Solar Roadways® is the first company to develop Solar Road Panels, which opens up a brand-new market for the solar industry: all walking and driving surfaces. Solar Road Panels are intelligent, modular, strong infrastructure panels which have solar cells to produce clean energy in places where it was previously impossible: parking lots, sidewalks, driveways, bike paths, roads, playgrounds, airports, etc. Solar Roadways®’ research and development has been funded by three U.S. Department of Transportation contracts. Our goal is to modernize the infrastructure with modular, intelligent panels while producing clean renewable energy for homes, businesses, and cities.


Was hoping to get some dialogue on CF investments. Not for traders since time frame is often 5 years. My feeling is that IPO initiation much of the money has already been made.

Share RecommendKeepReplyMark as Last Read


To: Thehammer who wrote (17)12/30/2020 11:13:24 PM
From: rebeccaaw
   of 37
 
Much obliged for the data you shared, I will get in touch with them now! fall guys

Share RecommendKeepReplyMark as Last ReadRead Replies (1)


To: rebeccaaw who wrote (32)12/30/2020 11:18:48 PM
From: Thehammer
   of 37
 
Thanks, I was hoping to get some discussion regarding non public investments via crowdfunding. I have used Start Engine and Wefunder but there are others. Seems that some viable startups prefer equity crowdfunding to more traditional means. Start Engine is interesting because they have started a secondary market but currently only trade their own shares.

Some of the startups are really good about keeping investors in the loop, others are terrible.

Let me know how you fare!

Share RecommendKeepReplyMark as Last Read


From: Thehammer1/31/2021 11:53:02 PM
   of 37
 
Some changes to Equity Crowding coming in march:

Federal Register :: Facilitating Capital Formation and Expanding Investment Opportunities by Improving Access to Capital in Private Markets

From StartEngine:

This means that beginning in March, companies can raise up to $5M via Regulation Crowdfunding and $75M via Regulation A+. These changes have big ramifications for StartEngine and equity crowdfunding as a whole. We hope that the higher maximum raise amounts will encourage more mature businesses to use equity crowdfunding for their funding needs.

And for investors, it means that the annual limits you can invest will also increase. Beginning in March, accredited investors will not have investment limits, and non-accredited investors will use the greater of their annual income or net worth when calculating their investment limits (today, this figure is calculated by the lesser of those two amounts).

Share RecommendKeepReplyMark as Last Read


From: Thehammer2/1/2021 10:08:38 AM
   of 37
 
I have been looking at small wind turbines via Flower Turbines as my next equity crowdfunding investment.

Flower Turbines | StartEngine

They are in their third round of capital raises via StartEngine. This one is a Reg A which has higher reporting requirements as well higher dollar maximums for amount raised. I have been investing relatively small dollar amounts for 3 years. My record is spotty as best. However, being startups, you will definitely get some failures. I have been investing in Biotech for over 30 years as well and you get a few big winners, some moderate winners and fair share of losses. I suspect the same will be true in the equity crowdfunding space.

These are investments for the long haul and illiquid. They are not for someone with a trading perspective. Probably 5 years minimum.

Flower turbines seems to be more for residential and small company energy enhancements in areas that are windy. Their design is harmless ( so they claim) to wildlife and the turbines turn at lower wind speeds than traditional turbines. So far sales are low and mainly in Europe. This fund raising effort is their third and is supposed to ramp up sales and marketing efforts.

Also some engineering efforts underway to address problems with mounting on non flat roofs.

Share RecommendKeepReplyMark as Last Read


From: Thehammer2/9/2021 2:03:38 PM
   of 37
 
WeFunder, the largest Equity Crowdfunding platform with 41% of the market (they claim) is raising equity. Minimum investment is 3K
Here is their "deck":

Wefunder1.png (d2qbf73089ujv4.cloudfront.net)

Share RecommendKeepReplyMark as Last Read


From: Thehammer3/2/2021 7:59:20 AM
   of 37
 
Nascar Partners With Comcast NBCUniversal SportsTech Accelerator To Streamline Logistics (forbes.com)

XIQ is one of the first companies that I put a little (and I do mean little) $$ into. With some companies, especially the smaller ones, you never hear anything after you invest. Karlos Walkes (CEO) has been exceptional in messaging developments and strategy. He responds to questions rapidly when I ask or comment in a very timely manner.

Share RecommendKeepReplyMark as Last Read
Previous 10