A Platform Analysis Breakdown - KingsCrowd

July 9, 2019

A Platform Analysis Breakdown

Back in April, I took a look at some data points on some of the numerous crowdfunding platforms that exist for companies to list their offerings. One of the high level takeaways from that analysis was that StartEngine and Wefunder were at the head of the pack in terms of the number of offerings listed, capturing nearly 70% of the market in my sample. So I thought it’d be fun to dig a little deeper into those two platforms with a little game of “Greater Than, Less Than, or Equal To” (hat tip to MorningBrew for the idea). The game is simple – I’ll give you a statistic, measured for each platform based on data in my dataset, and you determine if one is greater than, less than, or equal to the other. Then I’ll go into a little more detail on each. 

Understand the rules? Good, great, grand, wonderful…let’s get started

Greater Than, Less Than, Equal To
Number of Offerings Wefunder StartEngine
Average Offering Minimum Wefunder StartEngine
Average Amount Raise Wefunder StartEngine
Offerings Raised Over $1M Wefunder StartEngine
Average Success Rate Wefunder StartEngine
Average Investors per Offering Wefunder StartEngine
Most Investors for Single Offering Wefunder StartEngine
Average Investment per Investor Wefunder StartEngine
Average Valuation Wefunder StartEngine
# of Tech Offerings Wefunder StartEngine
# of Infrastructure Offerings Wefunder StartEngine
# of Food and Drink Offerings Wefunder StartEngine

OK, you have your answers? You didn’t cheat and peak down below, right?

Number of Offerings Wefunder Less Than (227 to 406) StartEngine
It probably makes most sense to start with the number of offerings. And if you recall the article from April, this makes sense, as StartEngine made up 42% of the sample and Wefunder accounted for 27%. The number of offerings surely has an impact on what we’ll see below too.
Average Offering Minimum Wefunder Greater Than ($127,970 to $10,444) StartEngine
Wefunder takes top billing when it comes to the average offering minimum. This is driven by occupying 99 of the top 100 highest offering minimum spots, with 6 of those offerings asking for over $500,000. On the flip side, StartEngine occupies 99 of the 100 lowest offering minimums ($10K)
Average Amount Raise Wefunder Greater Than ($198,450 to $75,770) StartEngine
It makes sense then, that with the larger minimums that we saw above, Wefunder offerings raise more money, on average, than their StartEngine counterparts. Except…
Offerings Raised Over $1M Wefunder Equal To (9) StartEngine
That’s right, in our sample the two platforms both had 9 offerings cross the $1M threshold. 
Average Success Rate Wefunder Greater Than (59% to 58%) StartEngine
Despite the larger dollar amounts, the two platforms are nearly equal when it comes to success rate of offerings on the platforms. And that’s really what these firms are focused on, right?
Average Investors per Offering Wefunder Greater Than (237 to 116) StartEngine
Wefunder is often bring a larger number of investor to offerings than StartEngine. Though with the larger minimum targets, it makes sense that they would need more people to get the offering across the finish line.
Most Investors for Single Offering Wefunder Greater Than (4,503 to 3,824) StartEngine
Wefunder’s largest offering, by participation is LegionM. StartEngine’s largest offering is JetToken
Average Investment per Investor Wefunder Greater Than ($1,071 to $751) StartEngine
This one could have gone either way, as on one hand, Wefunder is raising more money per offering. But on the other hand, this amount is spread out across more investors. At the end of the day, the higher raises outweigh the investors.
Average Valuation Wefunder Greater Than ($12.8M to $10.4M) StartEngine
Last but not least, Wefunder checks in with a higher average valuation per offering, falling slightly ahead of the overall average valuation of the sample (~$11M), while StartEngine falls slightly below.
# of Tech Offerings Wefunder Less Than (28 to 84) StartEngine
StartEngine triples up on Wefunder when it comes to Technology offerings. Wefunder’s Tech offering number more closely resembles the number of StartEngine’s Consumer (29) and Medical, Health, and Well-Being (27) offerings.
# of Infrastructure Offerings Wefunder Less Than (3 to 11) StartEngine
StartEngine owns nearly a 4 to 1 advantage here. Wefunder’s 3 offerings is on par with StartEngine’s 3 Media and Publishing Offerings.
# of Food and Drink Offerings Wefunder Greater Than (60 to 30) StartEngine
The edge here goes to Wefunder, who doubles up StartEngine when it comes to Food and Drink offerings. StartEngine’s 30 offerings is more in line with Wefunder’s 28 Software offerings.

How’d you do? Be honest.

10 – 12 Correct: Consider yourself a KingsCrowd “Top Deal”

7 – 9 Correct: Is that a “Deal to Watch” I see?

4 – 6 Correct: Not quite there yet, but let’s call you an “Underweight Deal”

0 – 3 Correct: Looks like you’re on the FINRA banned platform list

Despite the name of the above exercise literally being “Greater Than, Less Than, or Equal To”, the takeaway here shouldn’t be that one platform is “Greater Than” or “Less Than” the other, but rather just the simple fact that they’re different. And different, well, it’s ok to be different.


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About: Chris Lustrino

A Boston College Eagle for life, on a mission to democratize startup investing for all people at KingsCrowd, with a passion for Fintech, investing, social impact, doing well and doing good, and an avid runner, cyclist and writer.

View Chris Lustrino's articles

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