Equity crowdfunding in the United States is a blank slate. Withequity crowdfunding's recentlegalization in the United States, many companies smell anopportunity to develop technical and financial innovations to helpthe industry mature.
|Equity crowdfunding is much like crowdfunding, which has beenpopularized in the United States through sites such as Kickstarterand Indiegogo. The difference is that instead of individualssupporting campaigns through donations, numerous investors arepurchasing small stakes in startups or small businesses. Critics ofcrowdfunding worry that the industry will be rife with Ponzischemes or that having too many investors will hurt startups'prospects for future funding.
|Proponents of equity crowdfunding, however, point to its successin countries such as Australia and Germany. Forexample, Seedmatch,an equity crowdfunding platform in Germany, allowsinvestors to enter long-term investment contracts where they getequity. Australia, where equity crowdfunding has been legal forseven years, already has a platform for “secondary” salesof unlisted issued securities.
|Currently, equity crowdfunding in the United States lacks theorganizations and support infrastructure, such as investorverification systems and clearing houses, needed for a thrivingequity crowdfunding ecosystem. Read the entire NerdWallet.com blog post.
Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
- Exclusive discounts on ALM and CU Times events.
- Access to other award-winning ALM websites including Law.com and GlobeSt.com.
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
