What is Equity Crowdfunding?
Equity crowdfunding and investing in the shares of start-up and early-stage companies can be satisfying and financially rewarding, but it is also very risky and the investor needs to be able to afford a total loss of the capital invested. Click here for our full risk warning.
Equity Crowdfunding is where the crowd can invest into businesses in order to receive shares. It allows businesses to get the help they need to grow as well as allowing investors a chance to make money and become involved in a growing business. Equity Crowdfunding has allowed many start-ups and SME’s to raise the finance they need that may not have been available to them through traditional forms of finance.
People invest in an opportunity in exchange for equity. Money is exchanged for shares, or a small stake in the business, project or venture. As with other types of shares, apart from community shares, if it is successful the value goes up. If not, the value goes down.