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Wefunder (YC W13): Invest in Startups

wefunder.com

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Re: Wefunder (YC W13): Invest in Startups

#11

Post by niggler »

jgj wrote: post #4
mkeung wrote: post #2

When I click "certify as an investor" I automatically get directed to sign up for early access, with Facebook. I am hesitant to enter my information, because I don't know what the certification process is like. It would be great if you could add this information somewhere? I highly doubt I qualify so it would be for nothing.

Income for 2011-2013, net worth >< 1,000,000 and agreeing that you understand the risk of investing in startups, plus a signature

I haven't tried it yet, but based on your statement:

The requirement is `or`, not `and`: you are still considered an accredited investor if your net worth exceeds 1M and you have 0 income for the past two years. You are also still considered an accredited investor if you have 0 net worth yet have income exceeding 200K/300K

The normal way a form is laid out is that it asks you how you are considered an accredited investor (circle one oval) and give the relevant information.

Re: Wefunder (YC W13): Invest in Startups

#12

Post by HockeyPlayer »

Lots of new people in this space lately: AngelList via SecondMarket, FundersClub, MicroVentures.

I have an investment in a seed fund run by a prominent angel, so I have some insight into recent valuations. I get the feeling that these online investors are getting inferior terms. For example, convertible debt usually comes with a conversion discount and a cap, but the deals I've seen on FundersClub have been missing one or both.

Re: Wefunder (YC W13): Invest in Startups

#14

Post by sochanger »

jwb119 wrote: post #9

How are you guys avoiding having to register as a broker dealer before the JOBS act goes into place? (I'm assuming you're applying for Funding Portal status afterwards)

Great question. There are a few reasons we are able to do this now, mainly that we are not being compensated in any way. That being said we do have a relationship with a broker dealer to give us flexibility moving forward.

Re: Wefunder (YC W13): Invest in Startups

#16

Post by niggler »

dicletian wrote: post #7

"All the small investors (often So your company must create and manage a new investment vehicle for each startup to raise money on Wefunder? I assume so, otherwise the investors in one holding will incur the liability of the fund being sued by the investors/investment of another. According to your FAQ, you are not charging any fees yet and have raised about $500k to support your operations. On top of operating the pa…

"What happens if your company runs out of money to properly steward the funds you raise?"

That's a very important question.

They can't even accept money from non-accredited investments until early 2014 (SEC period after JOBS act goes into effect is supposed to end in early 2014). I think they have time to sort that out.

Re: Wefunder (YC W13): Invest in Startups

#17

Post by rdl »

This looks great -- nice to see more options for individuals to invest. I don't think you should ever be convincing someone to invest in startups, but I was actually looking for a way to invest in microryza, and they used your system.

Re: Wefunder (YC W13): Invest in Startups

#18

Post by rdl »

niggler wrote: post #11
jgj wrote: post #4

Earlier quoted context omitted.

Income for 2011-2013, net worth >< 1,000,000 and agreeing that you understand the risk of investing in startups, plus a signature

I haven't tried it yet, but based on your statement: The requirement is `or`, not `and`: you are still considered an accredited investor if your net worth exceeds 1M and you have 0 income for the past two years. You are also still considered an accredited investor if you have 0 net worth yet have income exceeding 200K/300K The normal way a form is laid out is that it asks you how you are considered an accredited inve…

Their documentation was actually ambiguous until you submitted, too (I used to qualify on income but not assets, now I qualify on assets but not income; I wasn't sure if I'd go through, but did).

IMO, I'd probably err on requiring more as an investment market like this, just to avoid the odds of an early lawsuit or other dispute -- $200k/yr AND HNW AND previous investment experience would be totally reasonable. But that obviously makes it harder to recruit people.

Re: Wefunder (YC W13): Invest in Startups

#19

Post by redblacktree »

HockeyPlayer wrote: post #12

Lots of new people in this space lately: AngelList via SecondMarket, FundersClub, MicroVentures. I have an investment in a seed fund run by a prominent angel, so I have some insight into recent valuations. I get the feeling that these online investors are getting inferior terms. For example, convertible debt usually comes with a conversion discount and a cap, but the deals I've seen on FundersClub have been missing o…

As a founder, more startup-friendly terms sound good to me.

Re: Wefunder (YC W13): Invest in Startups

#20

Post by pg_bot »

Seed investing is not something for amateurs, in fact frankly I don't think investing in public companies is for amateurs. I would tell ordinary people to invest in index funds and don't invest in startups at all. You should not be investing in startups because you think it is going to change your life. You shouldn't be doing it unless you're rich enough that your life wouldn't be changed by making lots of money. - Paul Graham
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