KingsCrowd Education

Is Common Stock the Ideal Security-Type for Equity Crowdfunding?

Common Stock essentially represents ownership in a company. Investors receive common stock in exchange for their investment, and through the ownership of common shares, they become part owners of the company. The percentage of ownership stake is in proportion to the number of common shares owned and sometimes bring with

How Safe are SAFEs?

SAFE refers to a “Simple Agreement for Future Equity.” Under the agreement between the founders and investors, investors receive a future stake in the company if the triggering event takes place. The triggering event can be a future round of funding, or a merger or acquisition.SAFEs are another common security

Pros and Cons of Raising Crowdfunding through Convertible Notes

As with any business, early-stage companies have the option to either raise funds through equity or debt. While both the mechanisms have their own set of pros and cons, convertible notes offer a hybrid solution to match the needs of early-stage investing.In a way, they work as short-term loans to

Is Preferred Equity the “Preferred” Structure of Equity Crowdfunding?

For investors participating in equity crowdfunding markets, preferred equity is one share-class structure you have the opportunity to invest in, most often seen on SeedInvest.Preferred Equity provides an ownership stake to investors, like common equity, however, it has certain advantages over traditional common stock. For this reason, many angel investors

Due Diligence Is The Key To Startup Investing Success

Equity Crowdfunding is a high-risk, high-return area of investment. This is for a very simple reason: it involves investing in early-stage startups that do not have a history of performance, financial results, or even marketable products. The probability of failure is outsized in comparison to public companies, but the gains

How Much Should You Diversify Equity Crowdfunding Investments?

Investing in startups via equity crowdfunding is an inherently risky business. Yet with great risk comes great reward.  We've all heard stories of investors that got in early on today's biggest corporate names. The newest, and easiest way for practically anyone to get in on early-stage companies is equity crowdfunding. The best way to

What Is Pre-Seed Funding?

Pre-seed round of funding, or pre-seed money, is the capital that a business needs to get itself started. The business or startup is mostly in the idea stage when it receives the pre-seed round of funding.What is Pre-Seed Round of Funding?The pre-seed round is, generally, the first capital a startup

What is A Seed Round Of Funding?

Seed Funding is the amount of capital received by a startup to support its cash requirements until it is able to generate operating cash flow of its own. It is also an early-stage round of funding and is used for preliminary operations.What is a Seed Round of Funding?In the days