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Wefunder

We're like Kickstarter for investing. Help us fund 20,000 more founders.

San Francisco
Technology Y Combinator PBC and B Corps Crowdfunding

Wefunder

We're like Kickstarter for investing. Help us fund 20,000 more founders.

I started Wefunder because I wanted to invest in my friends - to help them dream bigger, be the best versions of themselves, and reach their ambition. Seven years later, we do that for the rest of America. So much raw talent is being wasted. The purpose of my life is to fix that, to help tens of thousands "take their shot".
Nick Tommarello CEO @ Wefunder
Last Funded November 2019!

$10,061,353
total funds raised

842
total investors

  • About
  • Updates 13
  • Grapevine 47

Why you may want to support us...

1 $110 million in investments
2 $4M revenue run rate. Profitable since March 2019. $350,000 revenue in August 2019. Expenses ~$240,000/month.
3 2X year over year growth in revenue and investment volume
4 44% market share. Largest funding portal by investment volume and investors. About as large as our top three competitors combined.
5 $2.2 billion of follow-on financing into startups first listed on Wefunder.  40%+ IRR from 2013-16 vintage years.
6 We're the first funding portal. We helped change the law in 2012 and launched the first day Regulation Crowdfunding was legal.
7 Helped Congress pass JOBS Act in 2012; invited to watch President Obama sign into law.
8 Helped House pass JOBS Act 3.0 406-4. Now in Senate. This is expected to turbo-charge our growth.

Our Team

And Our Major Accomplishments
Nick Tommarello
CEO
Designer, engineer, MBA, holder of Series 65, alumni of Y Combinator and Techstars. Also enjoys rock climbing, bungy jumping, and climbing mountains.
Greg Belote
CTO
Master's from MIT. Alumni of Y Combinator and Techstars. Codes in VIM with 8 windows open. Built embedded robot operating system as a hobby.
Jonny Price
Head of Fundraising
Former head of Kiva US and member of the community advisory council of the Federal Reserve.
Suzanna Rush
Head of Operations
Kieran Ryan
Fundraising Team
Jacqueline Hoang
Community Team
Gadi Borovich
Head of Venture Partners
Benjamin Nguyen
Software Engineer
Youree Choi
Storyteller & Illustrator
Margarita Quijano
Fundraising Team
Jake Suggs
Account Manager
Kati Conley
Operations
Justin Renfro
Fundraising Team
Mike Norman
Founder (indefinite sabbatical)
MBA from MIT. Former national kickboxing champion. Holds Series 7. Alumni of Y Combinator. Loves interviewing founders and telling their story.

Why people love us

I've worked closely with Nick Tommarello for five years. I’ve been an investor, a co-worker, a mentor, and a friend. Nick has a simple and powerful vision for Wefunder: To give regular businesses the same access to capital that high-tech startups enjoy. From the very beginning, Nick said he was going to build a company to help every deserving business that needs capital start or grow. I watched as he and his team went to Washington to help convince Congress to enact the Crowdfunding Bill. And I’ve watched as they’ve built a remarkably fast and simple system that turns a concept of crowd funding into a reality of new growth for businesses.
Bill Warner
Founder of Avid - Investor in Wefunder

Some of our investors

we've raised $10,661,353 from 850+ investors since our founding
Y Combinator
Y Combinator
Seed funded 1500+ startups (including AirBnB) with total valuation over $85 billion. 70 startups valued over $100m.
Shen Tong
Shen Tong
Serial entrepreneur, angel investor, writer/poet, social activist, foodie, film buff
Paul English
Paul English
KAYAK CTO & Cofounder @englishpaulm
General Catalyst
General Catalyst
Venture capital firm in Boston and Palo Alto
Andrew Ellis
Andrew Ellis
Founded SignNow (Khosla funded) & sold it to Barracuda (May 2013), hedge fund background, USC Business.
Eugene Zhang
Eugene Zhang
Founding partner of TEEC Angel Fund since 2010. Experiences at JEDA, Juniper, Cisco, SUN. Two time entrepreneur.
Bill Warner
Bill Warner
Founded Avid and Wildfire. Working to supercharge Mass tech scene.
Lynn Walder
Lynn Walder
Capitalism with a Conscience; Opportunity guided by Accountability; Crowdfunding builds Communities
Amish Shah
Amish Shah
Founding Partner, Sierra Maya Ventures early stage seed/angel fund for startups.
along with   841 other investors

In the news

San Francisco
technology y combinator pbc and b corps crowdfunding

The Story of Wefunder

We've spent seven years bending the world to our will. In 2012, we helped Congress pass the JOBS Act. On May 16th 2016, it finally happened. Wefunder has been the largest funding portal ever since.
Jan 2012

Lobbied Congress to legalize equity crowdfunding

We thought it wrong that it was illegal to invest in our friends. So we launched a petition to Congress to change the law. We were invited to DC by Senator Brown, Senator Bennet, Senator Merkeley, and Rep. McHenry, and helped teach them how startups raise money. We were mentioned in the Senate and the Congressional Record several times.

Wefunder a few hours after launch; January 2012
Senator Brown & Rep. McHenry at Wefunder Forum
After a full day of meetings with Congress
Apr 2012

Invited to watch president obama sign

Congress passed Regulation Crowdfunding as part of the JOBS Act, and we were invited to the Rose Garden to watch President Obama sign it into law. The only hitch: the SEC had to write 600+ pages of rules before it could take effect. Little did we know that would take 4 years.

Mike Norman and Senator Brown at the signing ceremony
Jan 2013

Y COMBINATOR

We packed our bags and headed to California to attend Y Combinator, the Harvard of startup accelerators. We drank a lot of red bull and coded all night long. We also became friends with some of the most talented startup founders in the world. It helped us understand how to work with high-quality startups with lots of other financing options.

Right after our YC interview
This is how we survived for 3 months
Apr 2013

Launched 'rich person crowdfunding'

It became evident the SEC was not going to roll out Regulation Crowdfunding anytime soon. So we decided to use current law to help wealthy accredited investors around the world invest in promising tech startups. On March 25th, we launched our first company: Zenefits. At a $9 million valuation. Last we checked, it was worth $4.5 billion.

The first startups we funded in 2013

Apr 2014

Talks with sec

The rich person crowdfunding gig was fun, but it's not what we wanted to do long-term. We never took our eye off the SEC and their rule-making on Regulation Crowdfunding. We offered nearly 20 pages of detailed comments on their proposed rules and flew to Washington DC to meet the SEC in person.

Just before our friendly chat
Oct 2015

sec posts final rules for reg crowdfunding

The SEC released 685 pages of rules. Wefunder was mentioned 72 times. Overall the rules were good, but there are a couple of flaws that Congress needs to fix to protect investors. Senator Bennet wrote a letter to the SEC with our concerns, and Congressman McHenry introduced the Fix Crowdfunding Act.

Mar 2016

Amtrak across America

For three years, we focused on funding tech startups in Silicon Valley. With Regulation Crowdfunding coming, it was time to expand. Our vision was always to help fund a cross-section of the economy in "real America". So our entire company hopped on a train and met hundreds of business owners across America, 12 cities in 2 weeks, coast to coast.

From SF to Boston via Amtrak
May 16 2016

regulation CROWDFUNDING GOES LIVE!

On May 16th, the law changed: startups can raise up to $1 million per year from their friends and supporters, who can invest as little as $100 each. Companies can be funded as they were 80+ years ago: by their friends, neighbors, and local communities. Not some conglomerate bank headquartered on Wall Street that treats you like a FICO score.
Why small businesses need Wefunder
Tom Lix, CEO of Cleveland Whiskey
Sep 2018

Launched XX: a community of founders

With the XX, we've recuited a community of all-star founders (who have built startups worth over $4.2 Billion) to scout out, invest in, and help startups succeed. 42% of our pre-seed investments have later been accepted by Y Combinator. We expect this to be the primary way new companies are recruited to use Wefunder.

Dec 2019

Wefunder is the largest funding portal

Over the first couple years of Regulation Crowdfunding, Wefunder is the largest funding portal by number of investments, investment volume, and investor returns.

In 2019, reforms are expected to fix Regulation Crowdfunding, greatly expanding the market. JOBS Act 3.0 has passed the House 406-4. Additionally, the Commision of the SEC has directed the staff to independently revise the regulations in the near-term.

Results: May 2016 to May 2017
$20,102,092
Total Reg CF Commitments
$17,343,621
Equity Commitments
$2,758,471
Debt Commitments
103
Total Reg CF Offerings
$1,000,000+
Reg CF Revenue
23,025
# Reg CF Investments

Stats & Traction

Annual charts

On May 2016, Regulation Crowdfunding rolled out. Our business changed from serving only the wealthy to allowing anyone to invest as little as $100. We spent much of 2018 on more automation and operational improvements to handle the dramatic increase in investments. In 2019, our growth re-accelerated.


Q1 2019 is Our Best Quarter Ever


Our market share is increasing

Over 2019, we've done about as much Reg CF funding volume as our three closest competitors. This is despite Wefunder having a team of 12. Many of our other competitors have over 40 people.


Source: Crowditz

Economics

On average, each company raises ~$300k. We earn 9% cash fee for each dollar of funding volume. So we earn, on average, ~$27,275 per company funded. Our direct costs to launch each company is under $500. Our cost of acquisition is under $200.

We've been profitable since March 2019. Our monthly expenses have been about $240,000 over 2019. At a 9% average fee, we need to exceed $2.5M in Reg CF investment volume per month to be profitable. We've easily done that over 2019.

$303,053
Avg. Funding per Company
7.5%
Cash Transaction Fee Paid by Company
1.5%
Avg. Cash Transaction Fee Paid by Investors
$27,275
Revenue per Company Funded
$500
Direct Costs per Company
$200
Acquisition Cost per Company
$359,445
Revenue, August 2019
$241,824
Avg. Monthly Expenses,
2019
$2.5M
Reg CF Investment Volume to breakeven at 9% fee

Our Growth Driver: Companies

We're a double-sided marketplace. But we focus on acquiring companies, not investors. Each company we launch brings their friends, customers, and supporters to Wefunder - 58% of their total. 22% of these investors then invest in other companies.

$303,053
Average funding per company funded since May 16th 2016
334
Average Investors per company funded since May 16th 2016
58%
194 of 334 investors are new to Wefunder, referred by the company
22%
22% of these 194 new investors make another investment in a different company on Wefunder
$99,370
These 42 new investors invest a combined $99,370 in other companies within a year

Lifetime Value per Company

The value per company funded is at least $29,920 in the first year. The lifetime value may be 5X higher if we include referrals, follow-on financings, future value of equity or carry, the LTV of each investor the company signs up, & other services we can cross-sell. Here are two examples.

Barrow's: $154,000+

Barrow's raised $301,688 in 2016.

Barrow's signed up 224 new investors to invest in their round. They have since invested $1,082,069 in other companies on Wefunder.

The founder referred two companies - Vaute and Avua - that raised $336,854 on Wefunder.

At our current fee, the value of adding Barrow's Intense to date would be $154,000.

LegionM: $1M+

Using Reg CF, LegionM raised $1M in 2016 and another $1M in 2018. LegionM also raised another $5M+ using Reg A+

LegionM signed up 19,119 new investors to invest in their rounds, who since invested over $3,440,017 in other companies on Wefunder.

Reg A+ is free until we decide to be a broker/dealer. Otherwise, LegionM's value would be over $1M.

Cost of Company Acquisition

Our average cost per company is ~$200, all of which was paid to our scout program. We did not have any other marketing, direct sales, or advertising expenses.



As a long-term strategy, we expect referrals from the XX to be the primary way we acquire companies to fund. The XX is a team of very experienced founders who personally invest in and mentor early-stage founders on our platform. The best of those will eventually use Wefunder to crowdfund from their users and customers.

2013-2016 Investor Returns

Results as of December 2018, assuming an investor chose to invest $25,000 in each company that was funded on Wefunder from 2013-2016.

41%
Unrealized net IRR2
Vs. 15% IRR for Top 25% of venture capital firms3
$2,975,000
Total if invested $25K in each startup on Wefunder
$9,569,549
Current unrealized value as of Dec 2018
3.3X
Return multiple
81%
Startups still active
(96 of 119)
40%
Startups who went on to raise a Series A over $3M
$2.2 Billion
Follow-on financing
after our investment
11 @ $100M
11 startups now valued at over $100 million
Company Follow-on Funding
after We Invested		 Last Status Return Multiple Value of
$25K Investment
Zenefits $581,500,000 $500M Series C by Fidelity 206.1X $5,152,500
Ginkgo Bioworks $429,000,000 $270M Series D by General Atlantic 4.37X $109,250
Rappi $339,000,000 $200M by DST Global 12.34X $308,500
Checkr $149,000,000 $100M Series C by T. Rowe Price 34.31X $857,750
uBiome $105,000,000 $83M Series C by OS Fund
GrubMarket $62,000,000 $32M Series C by GGV Capital 3.15X $78,750
ShipBob $61,500,000 $40M Series C by Menlo Ventures 7.31X $182,750
Equipmentshare $56,500,000 $26M Series B by Insight Venture Partners
Ironclad $30,750,000 $22.75M Series B 2.9X $72,500
Goldbely $30,000,000 $20M Series B by Enlightened Hospitality Investments
Unbabel $29,500,000 $23M Series B by Scale Venture 1.45X $36,250
Guesty $22,750,000 $19.8 Series B by TLV Partners 2.56X $64,000
Casetext $19,000,000 $12M Series B by Union Square 2.4X $60,000
Eight (Formerly Luna) $19,000,000 $14M Series B by Khosla Ventures 1X $25,000
Flirtey $16,000,000 $16M Series A by Qualcomm and Menlo Ventures 1.11X $27,750
Paperspace $15,778,000 $13M Series A by Battery Ventures 1.63X $40,750
Astranis $13,500,000 $13.5M Series A by Andreessen Horowitz 1.87X $46,750
Skymind $11,900,000 $8.9M By Translink Capital & others 1.81X $45,250
Regalii $11,900,000 $7.9M by Kapor Capital 1.68X $42,000
Aptible $11,800,000 $11.8M Series A by Maverick Ventures 1.08X $27,000
Freight Farms $11,000,000 $7.3M Series B by Spark Capital 1.75X $43,750
Bonfire $11,000,000 Acquired by GTY Technology Holdings for $108M 1X $25,000
SimpleLegal $10,000,000 $10M Series A by Emergence Capital 2.49X $62,250
Eden $10,000,000 $10M Series A by S28 Capital 1.23X $30,750
Mux $9,000,000 $9M Series A by Accel 1.33X $33,250
ROSS Intelligence $8,700,000 $8.7M Series A by iNovia Capital 1.53X $38,250
Labdoor $7,740,000 $3.4M Series A by Floodgate 1X $25,000
Jopwell $7,500,000 $7.5M Series A by Cue Ball 1X $25,000
Gecko Robotics $7,000,000 $7M Series A by Founders Fund 2.58X $64,500
Virtuix $7,000,000 $7M on SeedInvest in 2016 1X $25,000
ZenProspect $7,000,000 $7M Series A by Nexus Venture Partners 1X $25,000
LivBlends $6,900,000 $6.9M by Alumni Ventures 1X $25,000
Privy $6,350,000 $4.25M Series A by Accomplice 2.68X $67,000
Senic $6,300,000 $4M by Birchmere Ventures 1X $25,000
Zenysis $5,800,000 $5.8M Series A by Tencent Holdings 1.65X $41,250
Second Measure $5,400,000 $5.4M seed round 1X $25,000
Terrafugia $5,350,000 Acquired by Geely for Stock 1X $25,000
Next Caller $5,000,000 $5M Series A by Crystal Towers 1.9X $47,500
Cleanly $5,000,000 $5M Series A by AddVenture 1.24X $31,000
Shinesty $4,460,000 $3.38M Series A 1X $25,000
Gravitational $4,200,000 $4.2M seed round 1X $25,000
AlphaFlow $4,100,000 Seed Round $4.1M 1X $25,000
Plate iQ $4,000,000 $4M Series A by Eileses Capital 1X $25,000
Circle Medical $3,500,000 $3.5M by A. Capital Ventures 1X $25,000
Wevorce $3,100,000 $3.1M Series A by TechStars 1X $25,000
OncoSynergy $3,000,000 $3M Series A by Connecticut Innovations 1.44X $36,000
Final $3,000,000 Acquired by Goldman Sachs 1X $25,000
Dealflicks $2,900,000 Failed 0X $0
Flaviar $2,250,000 $2.25M Series A by Speedinvest II International 2.08X $52,000
MTailor $2,000,000 $2M by Khosla Ventures 1X $25,000
Chai $2,000,000 $2M seed round 1X $25,000
Transcend Lighting $2,000,000 $2M Seed Round by Rose Capital 1X $25,000
Scope AR $2,000,000 $2M by New Stack Ventures 1X $25,000
Lawn Love $1,900,000 Alive 1X $25,000
One Month $1,900,000 $1.9M by Arena Ventures 1X $25,000
Instavest $1,700,000 $1.7M seed round 1X $25,000
RealCrowd $1,600,000 $1.6M seed round 1X $25,000
PAKIBLE $1,500,000 $1.5M seed 1X $25,000
Naytev $1,300,000 Alive 1X $25,000
Roomstorm $1,300,000 $1.3M seed round 1X $25,000
Asseta $1,000,000 $1M by Flight Ventures 1.54X $38,500
StatusPage.io $0 Acquired by Atlassian for Cash 2.87X $71,750
7 Cups of Tea $0 Alive 1.62X $40,500
Geekatoo $0 Acquired by HelloTech 1.28X $32,000
Interviewed $0 Acquired by Indeed for Cash 1.21X $30,250
BitAccess $0 Alive 1X $25,000
GBatteries $0 $1.2M grant by Canada 1X $25,000
MotionSavvy $0 Alive 1X $25,000
Ravti $0 Alive 1X $25,000
Roost $0 Alive 1X $25,000
Two Tap $0 Alive 1X $25,000
CapLinked $0 Alive 1X $25,000
Chronos $0 Alive 1X $25,000
Depict $0 Alive 1X $25,000
Experiment $0 Alive 1X $25,000
Give Me Tap! $0 Alive 1X $25,000
Italist $0 Alive 1X $25,000
Meadow $0 $2.1M seed round 1X $25,000
Olset $0 Acquired by Deem Inc. 1X $25,000
OwnLocal $0 Alive 1X $25,000
Parknav $0 Alive 1X $25,000
Toymail $0 Alive 1X $25,000
Underground Cellar $0 Alive 1X $25,000
VOIQ $0 Alive 1X $25,000
Mashgin $0 Alive 1X $25,000
Nextravel $0 Alive 1X $25,000
Smarking $0 $3M seed round led by Khosla 1X $25,000
Vertical $0 Alive 1X $25,000
Worklife $0 Acquired by Cisco Systems Inc. 1X $25,000
Appcanary $0 Acquired by Github 1X $25,000
Her $0 Alive 1X $25,000
The Ticket Fairy $0 Alive 1X $25,000
Lynks $0 Alive 1X $25,000
TrendMD $0 Alive 1X $25,000
Unima $0 Alive 1X $25,000
Nomiku $0 Alive 1X $25,000
Outbound $0 Acquired by Zendesk 0.84X $21,000
Bikanta $0 Failed 0X $0
Watchsend $0 Failed 0.78X $19,500
Camperoo $0 Failed 0X $0
Gone $0 Failed 0X $0
Bluesmart $0 Failed 0X $0
CoolChip $0 Failed 0X $0
Emberlight $0 Failed 0X $0
Kash $0 Failed 0X $0
Automate Ads $0 Failed 0X $0
MadeSolid $0 Failed 0X $0
SourceEasy $0 Failed 0X $0
Stayful $0 Failed 0X $0
Swapbox $0 Failed 0X $0
Valet Anywhere $0 Failed 0X $0
Whale Path $0 Failed 0X $0
Beep $0 Failed 0X $0
Doblet $0 Failed 0X $0
Fixed $0 Failed 0X $0
Magnises $0 Failed 0X $0
Traction $0 Failed 0X $0
Tsumobi $0 Failed 0X $0
Vive $0 Failed 0X $0
1.Assuming all startups funded by Wefunder Advisors were in the portfolio of one fund with equal $25K investments, comparison data by Cambridge Associates.
2.Net IRR after fees and carry. Marked as of Dec 2018, to latest valuation paid by an investor. Unaudited. Unrealized. Learn about IRR
3.Source: Cambridge Associates. Note that unrealized IRR often goes down over time. The final realized return will likely be lower.
4.Past performance is not indicative of future returns. Read Other Disclosures

2016-2017 Regulation Crowdfunding

Company Date Closed Amount Raised on Wefunder Last Status
Everipedia Dec 2016 $129,878 $30M Series A by Digital Galaxy
Beta Bionics Aug 2016 $1,000,000 $12.5M by Eli Lilly, Novo Nordis, & others
Meow Wolf Jul 2017 $1,069,939 $7.5M follow-on-financing
Discotech Oct 2016 $126,788 $1.2M by Wavemaker Partners
Snapwire May 2017 $184,752 Raised $800k seed by angels
fun-gi Feb 2017 $238,222 Alive
Chareau May 2017 $390,782 Won Double Gold Medal at the 2017 SF World Spirits Competition
That Christmas Movie Oct 2017 $308,900 Alive
CrowdMed Apr 2017 $403,471 Alive
Epec - James F.C. Hyde Sorgho Whiskey Oct 2017 $222,459 Alive
Rentus.com Aug 2017 $130,038 Alive
PlantSnap Sep 2017 $118,150 #8 paid iPhone app on app store in April 2018
EVELO Jan 2017 $729,723 Alive
Powur May 2017 $1,036,889 Alive
BioClonetics Immunotherapeutics Sep 2017 $386,766 Alive
Balance Sep 2017 $1,078,200 Launched the public beta of Balance Manager
Hopsters Feb 2017 $1,070,000 Opened 2nd location in Seaport on Jan 4
WhiteClouds Jul 2017 $1,070,000 Alive
Minds Jun 2017 $1,036,095 Over 1 million users and over 105,000 monthly active users
Hops and Grain Aug 2016 $1,000,000 Alive
Legion M Aug 2016 $999,999 "Bad Samaritan" is opening 5/4!
LiquidPiston Apr 2017 $999,999 Entering UAV market with rotary engine for drones
Scrap Connection / Tradefox Nov 2017 $993,499 Alive
Neurohacker Collective Nov 2017 $808,454 Alive
Cleveland Whiskey Oct 2016 $711,787 Annual sales increased in 2017 by 63%
Daplie Apr 2017 $500,000 Alive
Boardwalk Hospitality Nov 2017 $500,000 Opened location on Venice Beach
Ola Brew Co. May 2017 $496,140 Alive
The Speakeasy Aug 2016 $459,551 Alive
Monkey Rum Feb 2017 $425,058 Recruited former chief growth officer for Pabst as CEO
Force for Good Fund Nov 2016 $401,401 Alive
Digitally Imported Dec 2017 $396,113 Alive
Voyage Media Jun 2017 $375,983 Alive
VetPronto Nov 2016 $362,718 Acquired by Vetted
VAUTE Nov 2017 $341,406 Upcoming documentary about Vaute from Shopify
TAXA Biotechnologies Aug 2016 $309,807 Failed
Edge Dec 2016 $304,708 Alive
Barrow's Intense Dec 2016 $301,688 Partnership with Vermont-based Mad RiverDistillers
Happy Tax Dec 2017 $284,800 Alive
The Speakeasy Aug 2017 $270,788 Alive
Mobodexter Dec 2016 $266,641 Alive
Haint Blue Brewing Company Dec 2016 $266,429 Alive
MaestroConference Dec 2016 $264,069 Alive
This Is Ground Oct 2016 $252,336 Alive
Happy Tax May 2017 $242,205 Alive
Recoup Fitness Oct 2017 $238,824 On Season 2 premiere of "Entrepreneur Elevator Pitch"
South Austin Brewery Feb 2017 $210,680 Alive
Palmia Jul 2017 $204,565 New distributor, now in Good Eggs & Mollie Stone
FAFCO Aug 2017 $204,529 Alive
Bloomery Jan 2017 $197,000 Successfully lobbied West Virginia to change the law
Ridgemont Outfitters Oct 2017 $195,272 Alive
ShapeScale Dec 2016 $190,889 Alive
My Trail Sep 2016 $189,675 New retail location at The Outlets in Silverthorne
N1CE Nov 2016 $177,232 Alive
Urban Juncture Nov 2017 $176,829 Bernard Lloyd earned 2018 Governor’s Difference Makers Award
Magic Instruments Dec 2016 $175,348 Alive
Ohos Nov 2016 $169,611 Alive
Legion M Sep 2017 $167,941 Alive
Red Bay Coffee Company Oct 2016 $160,269 Two operations in Oakland and expanding into Richmond
ZipZap Jul 2017 $134,933 Alive
MySwimPro Sep 2017 $131,530 Official training partner of the Global Swim Series
Vera Roasting Company Apr 2017 $128,165 Alive
Native American Natural Foods Dec 2017 $123,152 Alive
Tampon Tribe Apr 2017 $119,119 876% net subscriber gain in 2017
Payroll4Free.com Jan 2018 $113,471 Alive
Oodles Corporation Aug 2017 $107,000 Alive
SlingFin Dec 2016 $105,891 Alive
N1CE Jul 2016 $101,386 Alive
QMedic Sep 2016 $100,000 Named one of the "best entrepreneurial companies in America" by Entrepreneur Magazine
Vodi Jun 2017 $90,391 Partnership with Viettel Group
Ganaz Inc. Nov 2017 $89,420 Accepted to Techstars Seattle
Eliot’s Adult Nut Butters Nov 2017 $89,037 Alive
ComicBlitz May 2017 $87,810 Alive
Motoroso Apr 2017 $87,200 Alive
Rumor Nov 2016 $84,670 Alive
VooDoo Spirits Sep 2016 $84,312 Alive
MobileSpike Mar 2017 $83,147 Alive
My Trail May 2017 $80,820 Alive
BLAZnTECH Dec 2017 $68,706 Alive
Spotlight:Girls Dec 2016 $62,500 Grant from RSF Social Finance
Bogobrush Oct 2016 $57,500 Alive
Veditz Oct 2016 $54,620 Failed
Maison Marcel Dec 2017 $48,025 Alive
Kibin Nov 2016 $27,602 Alive

Investor Q&A

Expand all
What does your company do?
"Kickstarter for investing" was legalized on May 16th, 2016: now, anyone can invest $100 in a startup. Since then, we have become the largest funding portal by investment volume and investor returns. We started this journey in 2012, when we helped pass the JOBS Act that made this all possible, and were invited by Congress to watch it signed into law.
Where will your company be in 5 years?
Our goal is to fund 20,000 more startups by 2029, while outperforming the S&P 500.  Entrepreneurship has been dying over the 30 years, falling from 10.6% to 3.6% among those under 30.  We must fix that: everyone deserves a shot at the American Dream.  If we succeed, we will increase the GDP of the United States
Why did you choose this idea?
I started Wefunder because I wanted to invest in my friends - to help them dream bigger, be the best versions of themselves, and reach their ambition. Seven years later, we do that for the rest of America. So much raw talent is being wasted. The purpose of my life is to fix that, to help tens of thousands "take their shot".
How do you earn money?
We have two main revenue streams: transaction fees on investing volume and carried interest. For companies that raise with Regulation Crowdfunding, we earn on average 9% of investing volume. We charge the company 7.5% of their total fundraise. We also charge the investor 2% of their investment (min: $8, max: $100), which averages out to around 1.5%. We also have have venture capital funds that charge 2% management fees and 20% carried interest.
What is the value of your current carried interest stake?
We have carried interest stakes in most companies funded via Regulation D.  Our IRR is over 40% from 2013 to 2016: https://wefunder.com/results However, we discounted our fees in the beginning.  For instance, Zenefits was the first company we listed on Wefunder, and as such, we charged 0% carry. If we had invested $150k at 20% carry, the value of our carried interest would have been $1,260,000 18 months after we funded them.
How do you convince high-quality companies to work with you?
Our past portfolio speaks for itself on our previous success in Reg D. We must continue to attract high-quality companies for Regulation Crowdfunding. First, it's important to define "high quality". It does not mean that companies are like Zenefits, offering investors a 4000%+ return in two years. To us, high-quality means deserving businesses with legitimate founders who can grow profitable companies. A donut shop that offers a return to their investors qualifies. It also typically means businesses who also can raise with Regulation D from professional investors. That is, they have other financing options. Our biggest strength is that we've spent years immersed in the Y Combinator startup culture, so we intimately understand how founders who have leverage against investors (as their startups are highly sought-after) think. When we take this understanding to the "real world" outside of San Francisco, we expect to blow away the competition. Customer service: save founders timeAn obvious truism is that successful founders with other financing options don't want to waste a lot of time. So we do nearly all the grunt work for them. We schedule an hour interview, ask for some disclosures and assets, and then hand them a fully-fleshed out fundraising profile and "Form C" SEC filing for their review and approval. Our customer service is key. Companies with other options won't pay an obscene amountAnother obvious point is that high-quality companies don't need to pay to get funded. Our competitors - typically the ones with a broker/dealer finance background - who charge over 10% of the round will not get the best companies. We currently charge the company 7.5%. In our experience, companies can justify this cost in return for the marketing value of having their customers be investors. We will continue to drive down company costs as long as possible and take more of our compensation in the same form as our investors, so our goals and interests are aligned. (We also charge $0 for a "Form C" instead of the up to $5000 of some of our competitors). Companies care about "signaling"Finally, working with credible companies is a virtuous cycle. High-quality companies want to be funded alongside other high-quality companies. Think about the difference between Y Combinator and Techstars. Most credible startups apply to Y Combinator first, and only go to Techstars if YC rejects them. It's much more prestigious to be in YC. We understand follow-on financing Another great benefit of being immersed in Silicon Valley for years is that we intimately understand the issues around follow-on financing when the venture capitalists come aboard. So we pioneered new crowdfunding securities to ensure that companies don't shoot themselves in the foot if they are successful. Our competitors don't do this to the same extent.
Why are your fees lower than your competitors?
Our costs are lower than our competitors', and we want to pass on the savings so we can fund more higher-quality companies. We're a "full stack" software and nearly entirely vertically integrated. We outsource almost nothing. This was an intentional decision as we knew we had to drive down costs to make thousands of investors cost effective. We wanted to control the user experience. We spent four years writing software to automate nearly everything. For instance, we wrote our own electronic contract signing software, ACH payment transfer software, investor management software, accounting software, SEC filing software, and are now working on tax filing software. We've partnered with a bank for on-demand escrow accounts at nominal cost and CPAs to offer independent reviews to our clients at nearly 20% of the market rate. We've also worked with our lawyers at Wilson Sonsini on legal structures that limit some franchise taxes and other unnecessary costs. Finally, we operate as an exempt reporting investment advisor and funding portal, limiting compliance costs that broker/dealers are burdened with.
How are you different than AngelList?
AngelList was our primary competitor before May 16th, 2016, when Regulation Crowdfunding was implemented. After May 16th, we moved in a different direction. AngelList is a beautiful web site for accredited investors who know the "inside baseball" game in Silicon Valley. It's perfectly designed for professionals. It's also the "operating system" for startups, with a number of useful services. We are different in a few ways: 1) We let everyone invest, not just the wealthy. This allows startups to raise money from their most passionate fans, not just a few rich people. 2) We fund a dramatically more diverse swath of the economy, from breweries to tech startups. 3) We're focused foremost on spreading the Silicon Valley ethos to the rest of the country. We want to lift up others who don't have opportunity.
Who are your competitors?
Our direct competitors include StartEngine, SeedInvest, Republic. The results speak for themselves. We're larger than all of them combined by investment volume. Our biggest strength is that - as founders ourselves - we know what is takes to find and work with high-quality companies. Check out our investor returns: https://wefunder.com/results. We've already proven that we can attract high-growth, high-profile companies to crowdfund from accredited investors (i.e., Zenefits), and now we're doing it again for Regulation Crowdfunding (i.e., Beta Bionics). Another strength is that none of us are finance types. We ourselves are startup founders & startup investors creating this for others just like us. We deeply care about the product we are building. We see the world differently. Our product isn't about just taking a cut, it's about relationships, community, paying it forward, and helping startups succeed. Wall Street doesn't do that. As technologists and designers, we also have an edge on execution. We've created software that dramatically reduces costs and is simple and easy to use for founders and investors alike.
How big can you be?
If you ask this question, you don't understand our ambition. We're talking about turbo-charging the entire economy. We want to accelerate GDP growth by making us a nation of owners in the true engine of our economy: small businesses and startups. We want to explode the number of new businesses. Our ambition is not to be a VC. We're aiming to create a new type of stock market that can allocate more capital to all sorts of worthy businesses, be it a local community-supported coffee shop or the next Uber. We want to create and dominate the emerging private/public hybrid stock market for new businesses, where it's accepted that these are riskier, longer-term investments (i.e., not the NASDAQ). We believe the "wisdom of the crowd" is superior to the judgement of a few gatekeepers like bankers and venture capitalists. Markets beat top-down decision making. We also want to single-handedly increase the percentage of under 30 year olds that own stakes in private businesses from the current 3.6%, back over 10%, like it was in 1989. Entrepreneurship is dying in this country, outside of tech hubs like SF and NYC. We aim to revitalize capitalism for young people.
How will a new venture stock market work? Why is this needed?
Our long-term vision is to create a new type of stock market for risky and early-stage companies, for long-term investments subject to investment limitations. We believe that informed investors can allocate capital more efficiently across our society than a few bankers or venture capitalists. Markets beat gatekeepers. Unlike the NASDAQ, since it's expected by the public that these investments are far more risky (and as such are subject to investment limits), the burden of regulations are far, far less than that required by a company going public. Companies that refuse to go public until forced to do so (i.e., Uber) as a result of the burden of regulations imposed after Enron may consider a private/public hybrid stock market with a lighter regulatory regime. The features of this stock market should include: Acceptance of risk with every purchase. Investors should affirm that they may lose all their money and afford to bear this risk with every purchase. Investment limitations. Investors should not invest more than the 5%-10% limit of net worth or income imposed by Regulation A+ or Regulation Crowdfunding. Proxy voting power to one person with fiduciary responsibility. Minor shareholders should appoint one representative - who may be on the board of directors -to advocate for their interests. The company only needs to deal with one person with sophisticated knowledge of their business, and the voting power of small investors is aggregated to increase their leverage. No daily price ticker; limited resale. The short-term focus to manage quarterly earnings is often detrimental to long term vision. We envision a stock market where companies can opt to allow resale on a secondary market only once per quarter or year. The benefits to our society include: More capital goes to where it is needed most. Capital will be allocated more efficiently to a wider range of businesses. We expect an explosion of entrepreneurship. There are enough people in our society who want to support riskier ideas. We can start reversing the disparity of wealth. In the 1990's, it was a badge of honor for companies to go public, and they did it as soon as possible. Now they delay it as long as possible. This means ownership in the fastest growing companies are no longer available to people who are not rich. This is wrong.
What is your Cost of User Acquisition? How will you scale it out?
We expect word of mouth to always drive our growth, and for our CAC to remain nominal. We are not like a bank advertising to give out business loans. Wefunder is a social network, where people fund companies they love. Each founder drives their entire network to Wefunder to invest in them. These investors later refer us companies. More impactfully, each founder we fund tells their founder friends to use Wefunder. Network effects have continually driven us more companies than we can handle, without us trying. We have little experience running paid ad campaigns because we’ve never had too. Equity crowdfunding has the same network effect dynamics as product crowdfunding. There will be a major player (a Kickstarter), and perhaps a secondary player (an Indiegogo). Everyone else will go out of business because they can’t get good companies. In terms of deal flow, we are somewhat analogous to a VC, where signaling and prestige is a factor. Much like how YC gets first dibs and the other incubators get the leftovers, crowdfunded companies also want to list on the biggest and best portal, the one that is proven to not only deliver the most funds, but has the most prestige. Companies want to be funded alongside other good companies. This is a virtuous cycle. Our biggest challenge right now is how to accelerate scaling this out "on the ground" across the entire country. For us, the answer revolves around working with local communities. We’re building a platform where other investors and groups can endorse and curate companies... in the geographies or industries they care about. The long-term idea is that Wefunder becomes the monopoly, and these communities compete within our ecosystem based on their reputation.
What are the most important parts of your user experience?
We've made it dead easy to invest in a company - it takes 30 seconds to fully execute an investment and transfer the funds. Consider it a "one click Amazon-style checkout" for investing. We've also created some beautiful software that lets founders highly customize how they wish to present their company to investors... and helps them generate and file a "Form C" with the SEC at a fraction of the complexity and cost of our competitors. Next, we want to execute better on our long-term vision. The investment is meant to be the start of our product experience. We want to help people "feel behind the curtain" -- that they are making a difference in the world, that they can find ways to help their portfolio companies, be it by spreading the word about product launches, providing introductions to new hires or partners, or giving detailed product feedback.
Why is your team awesome? Why you?
We've been relentlessly pursuing our vision for seven years. We don't let anything stop us, starting before Congress even passed a law. We helped Congress write the sections of the JOBS Act that will enable all Americans to invest, were mentioned by name in the Congressional Letter of Intent, and were invited to watch President Obama sign it into law. When we first started, we did not appreciate what we were getting ourselves into. Now we do. We were already proven product designers and software engineers... with MBAs. But we also needed to learn securities laws inside out, obtain our Series 65 and Series 7 licenses, and learn what it takes for investors to attract high-quality startups. But, most importantly, after 7 years, we have results. With a team of 12, we've built the largest funding portal, with above 40% market share in Regulation Crowdfunding in 2019. In comparison, our closest competitors - despite being larger than almost all of them combined - have teams of 35-50 people.
Why did you pick this idea to spend your life on?
Initially, we built this for ourselves. We wanted to make investments in our friends (back before we were accredited). One of Nick's best friends is angel investor Bill Warner, who founded a public company and sold another for about the same amount. He's inspired all of us: Bill spends practically all of his time helping founders. We wanted to be like him and help and invest in our startup friends. But we didn't have $50k to invest in each company... we had more like $500. Plus, it was effectively illegal for us to do so. We thought that was stupid. We’ve always wanted to invest in founders we believed in. Not primarily for the financial returns, but to give back, to help, and to live vicariously through their experience. It made no sense to us that only the wealthy had the privilege to act on these emotions prior to the passage of the JOBS act. People are people; the dollar amounts are just smaller. As we built Wefunder, we also learned that we could help our country by revitalizing entrepreneurship. It became evident to us how many deserving businesses can't get the capital they need to start or grow; the banks got way more risk-adverse after 2008, and venture capitalists pour money into a small sliver of the economy. We believe we can help fix that. The people who care should be allowed to allocate capital to businesses that need it.
What's the most surprising thing you've learned?
We've spoken to thousands of investors on Wefunder. We were surprised to the extent that they were motivated by the same things as us. We don't want to lose money, but we're not investing in startups solely for the financial returns. We want to support things we believe in. We consider our startup investing to be socially good lottery tickets. We were surprised that even accredited investors with a finance background feel the same way. We were also surprised that unaccredited investors pick the same exact startups on Wefunder as accredited investors. There is no correlation between income and the startups chosen.
What is your biggest risk?
While we can build a profitable business under present law, our vision will not be fully reached unless Congress and the SEC further improve securities regulations. We've worked with the Deputy Majority Whip, Congressmen McHenry, to help draft the Fix Crowdfunding Act that would greatly increase the potential of Regulation Crowdfunding. We've also been in touch with the offices of Senator Bennet, Senator Merkeley, and Senator Daines to support it in the Senate. In 2019, Congress and the SEC are expected to reform equity crowdfunding to make it more appealing for startups and investors, greatly increasing our growth potential. The House of Representatives passed JOBS Act 3.0 406-4 (it's now in the Senate) which includes important amendments to Reg Crowdfunding. Concurrently, the SEC is revising the regulations in the near term. As the largest funding portal, Wefunder is best positioned to take advantage of these reforms.
How will regulatory reforms help you grow faster?
Our growth is dependent on the number of high-quality companies willing to use Regulation Crowdfunding. There are three reforms which will make Reg CF far more appealing to a greater number of companies. Specifically: 1) Single Purpose Vehicles (SPV's). Right now, a startup that uses Wefunder will end with hundreds of direct shareholders. The way this should work is to have investors invest in a simple-purpose fund, which then makes an investment into the startup, so the startup has one shareholder on their cap table. SPV's are legalized for Reg CF as part of Jobs Act 3.0, which passed the House of Representatives 404-4. 2) Reform the 12g limit. Right now, a company with more than 500 unaccredited investors and more than $25M in assets would be subject to burdensome requirements akin to going public. JOBS Act 3.0 also addresses this. 3) Legalize Testing the Waters. Right now, a company would have to do a lot compliance and accounting work before they are allowed to list on Wefunder and ask investors if they are even interested in investing. A company should be able to fill out a profile in a day and start collecting commitments from investors. We expect the S.E.C to issue this reform as part of their three-year Reg CF look back in 2019.

Wefunder is conducting a Regulation D offering via Wefunder Advisors LLC. CRD Number: #167803.




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