By Ron Miller Partner at StartEngine, CrowdFundBeat Guest Post.
This week StartEngine announced that partner issuer Elio Motors has raised nearly $16 million in funding via Regulation A+ equity crowdfunding, making it the most successful such raise to date. This amount substantially surpasses the $12.6 million needed to finance the engineering and testing of the company’s E-Series prototype. Elio has attracted attention from investors and the media alike as it strives to alter the course of transportation with its innovative 3-wheeled vehicle. The funding round will close on February 1st, so the opportunity to invest in this progressive company at a ground floor level is still open – but closes soon.
A dual revolution is underway, both in the worlds of transportation and entrepreneurship. Elio Motors, by choosing to finance the development of its low-cost, versatile vehicle through an equity crowdfunding offering, is at the forefront of both these trends. In addition to keeping the company on course to launch a new era in personal automotive transportation, the tremendous reception for Elio’s raise proves that there is public demand for the type of opportunities crowdfunding can provide.
The success of Elio’s offering puts the company on track to reach its development goals, including a scheduled 2016 production launch of its E-Series vehicles. It also validates the concept of Regulation A+ equity crowdfunding, which stems from the passage of the JOBS Act in 2012. The SEC’s issuance of final rules for raises under Reg A+ in June of 2015 opened the gates for offerings such as Elio’s to reach the public.
By allowing non-accredited investors the chance to invest in opportunities that previously were restricted to venture capitalists and private equity firms, Reg A+ promised to democratize the funding process; the fact that the Elio Motors offering was able to exceed its funding goal provides proof that the measure can and does work.
The headway achieved by Elio demonstrates that StartEngine has the capability to help entrepreneurs truly realize their dreams. This will inspire thousands of entrepreneurs to follow the path that Elio Motors has blazed on the StartEngine platform. The company’s vehicle, with an expected base price of $6,800 and the capacity to get up to 84 MPG, represents a new paradigm for the transportation industry; one that the company hopes will help wean the country off its oil dependence as well as provide low-cost transportation.
Elio plans to produce the namesake vehicle in a former GM plant in Shreveport, Louisiana. It estimates more than 1,500 workers will be employed at the plant, with an additional 1,500 jobs being created in service, sales and supplier positions once full production begins. The company reports an enthusiastic reaction from fans of the car, with almost 50,000 people to date putting down their deposits for a place in line to purchase the car.
Following in Elio’s footsteps, XTI Aircraft, another firm with an innovative new approach to transportation, will begin raising funds on the StartEngine platform in the next few weeks. XTI is developing a vertical takeoff and landing aircraft for civilian use that has attracted substantial interest from aviation enthusiasts since it was first unveiled to the public.