How It Works
On StartEngine, you craft your investment pitch into a web page, raise capital from hundreds or even thousands of investors online, and fund the next phase of your growth with a bigger and stronger community behind you.
Choose Your Path
You have two paths to choose from when raising capital on StartEngine:
Raise up to $1.07M each year, every year through our funding portal, StartEngine Capital LLC
Launch at potentially no upfront cost
Launch in 4-6 weeks
Raise up to $50M each year, every year through our broker-dealer, StartEngine Primary LLC
Launching costs $50,000-$75,000
Launch in 6 months*
*The timing to launch a Regulation A+ offering can vary widely, but generally speaking, it will take 30 days to compile the necessary documents, another 30 days to complete and submit disclosure to the SEC, and 90-120 days to get qualified by the SEC. More on this below.
Steps:
Regardless of which regulation you choose, you will take the following steps in order to raise capital on StartEngine:
Apply
StartEngine reviews every company application internally to determine whether they meet our compliance requirements. If it’s a good match, we move forward! You can apply here.
Craft Your Story
Tell your story in your own words. Build and design your campaign page to attract investors. Our creative team will help you! Check out Knightscope’s and Terracycle’s pages for inspiration.
Set your own terms
Unlike venture capital and angel funding, on StartEngine you're in control and set your terms, from the type of security and its price to your company's overall valuation. You know what you're worth, and we respect that.
Prepare Your Legal Documents
We request corporate documents like Articles of Incorporation and Board Resolutions to approve your fundraise.
Review Your Financials
For a Regulation A+ offering, you will need a full financial audit, but for Regulation Crowdfunding, you have 2 options:
Save on upfront cost and self-certify your financials to raise up to $107K. To raise more than that amount, you will need an independent review from a CPA.
Don’t worry — if you start with self-certified financials, you can always commission the financial review during your offering in order to raise more than 107K.
What is required to launch?
Under both regulations, you will need to disclose basic legal documents, such as Articles of Incorporation and Board Resolution, as well as information about the business and its key executives.
The business owner can personally sign off on the legal and financial paperwork if the total raise is under $107,000. To raise more than $107K, you will need to work with an outside CPA to verify your financials for the past two years (or since the business started).
You will need both legal counsel and independent auditors. The Form 1-A (the legal document for your raise) is a big undertaking, so launching for free is not an option. You will need a full financial audit.
How long will it take to reach the maximum raise?
Once your raise goes live, it’s time to market your offering to your community! Tell your friends, family, customers, and users that you’re raising capital and encourage them to invest in your business. We market your raise to our audience too as your campaign reaches different funding milestones.
The duration of campaigns can vary significantly, but as a general rule of thumb:
Offerings are required to be live for at least 21 days. Generally speaking, companies raise for anywhere between 60-90 days, but they can continue raising for up to one year.
Under Regulation A, companies generally raise for anywhere between 6 months to a year, but they can continue raising for up to three years.
What happens after the raise is over?
After you successfully raise capital through equity crowdfunding, you have a few ongoing requirements to your new investors:
Businesses are required to maintain their public disclosures and file an annual report with the SEC for as long as your new investors remain on your cap table.
You have to send two reports a year to your new investors: annual reports with audited financials, and semiannual reports with unaudited financials.
Interested in raising capital on StartEngine?
Read this article on Regulation Crowdfunding and another on Regulation A to learn more about each regulation.
