Do some platforms bring better deals than others? Kingscrowd helps investors quickly assess the quality of a deal by rating it on a 1-5 scale. This proprietary rating system is based on hundreds of data points across five key categories: Market, Differentiation, Team, Performance, and Price.
- Any deal rated above 3 performs better than 50% of all deals.
- Any deal rated above 4 is in the top 25% of all deals.
To analyze platform quality, we examined the distribution of ratings for Reg CF and Reg A+ equity deals in 2024 using a box chart. Here’s what we found:
- Among the platforms with the highest number of deals in 2024, four had over 50% of their deals rated 3 or higher, while only about 25% of Netcapital deals reached this threshold.
- Dealmaker Securities facilitated the highest total fundraising online, yet its median rating is lower than three of its competitors. This may be due to the platform’s deals having frequent undisclosed valuations and high revenue multiples, which can result in lower ratings.
- Wefunder had the largest range of ratings, which aligns with its status as the platform with the highest number of deals. We rated 280 Wefunder deals in 2024, compared to 253 on StartEngine, 65 on Republic, 64 on Dealmaker, and 58 on Netcapital. Given its larger sample size, we might expect Wefunder’s median rating to be closer to the overall mean of 3. However, its median is actually the second highest among the five platforms, suggesting that despite its volume, Wefunder still attracts a high concentration of quality deals.
- Republic continues to lead in deal quality, maintaining its reputation for strong investment opportunities.
While platform rating distributions offer insights into overall deal quality, each investment should be evaluated individually. Despite some differences between platforms, all of them feature startups worth considering.
