SeedInvest Raises $1M To Help Angels Invest Online–Privately

Courtesy of SeedInvest SeedInvest CEO Ryan Feit, right, with SeedInvest adviser Sherwood “Woodie” Neiss during a trip to Washington to meet with bankers and regulators, believes his crowdfunding platform can help streamline investing.

Courtesy of SeedInvest
SeedInvest CEO Ryan Feit, right, with SeedInvest adviser Sherwood “Woodie” Neiss during a trip to Washington to meet with bankers and regulators, believes his crowdfunding platform can help streamline investing.

A crowdfunding platform called SeedInvest is betting that investors want a little privacy as they review and back promising startups online.
The site recently rolled out SeedInvest Groups, a feature that lets managers of angel groups invite members to review deals and fund companies without doing so in the view of industry onlookers.

Privacy features like this could help curb the “herd mentality” that often plagues investing, suggests Ryan Feit, the chief executive of SeedInvest.

Investors and entrepreneurs discussed this issue at the Premoney.co conference in San Francisco this week. Serial entrepreneur Elad Gil observed that equity crowdfunding sites, along with accelerators and affiliated seed funds, give inexperienced investors lots of information. But they can lead investors to pile on, and inadvertently drive up startup valuations, when the investors sense buzz and see big-name backers around a particular company.

Mr. Feit says that the private setting enables professional lead investors to negotiate and establish terms and valuations appropriately. That way, he said, when a company opens the round up to a broader group of investors later, “they don’t have to negotiate with 100 people who all want something different, and could drive up terms, out of misguided enthusiasm.’”

Another angel-friendly facet of SeedInvest’s approach: It doesn’t charge investors to use the site and service, but takes a small percentage of funds from startups raising money on the platform.

Competing platforms like FundersClub Management LLC and AngelList (in partnership with SecondMarket) ask investors to pay administrative fees and/or carried interest on their deals.

SeedInvest conducts its own due diligence, and it has partnered with broker-dealer North Capital Private Securities Corp. to complete deals.

The Star Angel Network–a New York-based angel group that educates celebrities about startup investing and encourages them to back and advise entrepreneurs–recently used SeedInvest to fund a mobile entertainment company called Lisnr.

The executive director of Star Angel Network, Erica Minnihan, said the new SeedInvest Group features on the site helped “streamline the investment process, so that it took about one minute and a few clicks. It also provides a very convenient way for [managers] to share information on a deal with [their] membership.”

Star Angel Network also used SeedInvest to privately share investor documents, deal memos and Webcast management presentations with members, she said.

One of SeedInvest’s backers, Tom Chisholm, an angel investor and the founder of Viecore Inc. (acquired by Nuance Communications Inc. NUAN -1.23% in 2007), said he expects the company to be one of the top players in the nascent crowdfunding industry because of its connections to “investors who do a meaningful volume of deals and have a high rate of success with these.”

He believes crowdfunding will see a proliferation of equity investing sites but will eventually consolidate down to half-a-dozen leaders in the field.

Write to Lora Kolodny at lora.kolodny@dowjones.com. Follow her on Twitter at @lorakolodny

Source: WSJ – By Lora Kolodny
Link: http://blogs.wsj.com/venturecapital/2013/06/28/seedinvest-raises-1m-to-help-angels-invest-online-privately/

HEADLINE NEWS

U.S. News & World ReportNo Cash for Hate, Say Mainstream Crowdfunding FirmsU.S. News & World ReportThe block on mainstream crowdfunding is just the latest blow to far-right activists operating online. In the last 24 hours, neo-Nazi website the Daily Stormer had its domain regi [...]

LITTLE GUIDANCE FROM IRS ON TAXING CROWDFUNDING CONTRIBUTIONSBloomberg BNAWe've all heard the stories of crowdfunding appeals that go viral. Whether it's a musician raising money to produce an album, an inventor with a great idea, or a family in distress that needs help, cro [...]

VCCircleNew trends in crowdfunding that make it a potent fund-raising toolVCCircleOver the years, crowdfunding has become popular among entrepreneurs mainly because it's a great way to test the waters before you actually launch the product or service. You understand your idea [...]

FortuneIndiegogo's Difficult Path to Offering Equity CrowdfundingFortuneIndiegogo founder Slava Rubin discusses how Indiegogo's equity crowdfunding service has been performing since its launch in 2016. Photograph by Indiegogo. E-mail; Tweet; Facebook; Linkedin. Share icons. [...]

Telegraph.co.ukSkiTelegraph.co.ukBut now, to supplement her fast food income and to be more certain of joining her older sister Katie, a fixture on the Park and Pipe team, Summerhayes has launched a crowdfunding campaign with PledgeSports to raise some money towards her travel and ... [...]

Crain's Cleveland Business'Smaller' gifts can go long way for Clinic's crowdfunding platformCrain's Cleveland BusinessFor an institution accustomed to securing multimillion-dollar donations, Cleveland Clinic's latest fundraising effort has some relatively [...]

NewshubWoman born without vagina crowdfunding surgeryNewshubThe family of a woman born without a vagina has started a crowdfunding campaign to receive reconstructive surgery. Kaylee Moats, from Arizona, lives with Mayer Rokitansky Küster Hauser syndrome (MRKH) meaning she has no cervi [...]

ForbesWhat Works In Equity Crowdfunding -- Insights From ResearchForbesAs we have recently celebrated the fourth anniversary of the signing of the JOBS Act into law, it is a good time to take stock of the effect that the legislature had on equity crowdfunding in the United States. It [...]

Global Crowdfunding Market 2017-2021PR Newswire (press release)Global Crowdfunding Market 2017-2021, has been prepared based on an in-depth market analysis with inputs from industry experts. The report covers the market landscape and its growth prospects over the coming years. The rep [...]

AOL UKShould you forget the stock market and focus on crowdfunding?AOL UKIn recent years, the popularity of crowdfunding has soared. For example, in 2016 the amount raised through crowdfunding surpassed venture capital funding for the first time in its history. By 2025, it is estimate [...]

CFB Finance

Marketwired

  • Crowdfunding
  • Crowdfund
  • Peer to Peer Lending
  • FinTech
  • Reg A+
  • Reg CF
  • Crowdfunding USA

Press Release

Live Crowdfunding .tv

What's Next Step in Regulation A+ JOBS ACTS Title IIII :L Interview : Steve Cinelli with Brian Korn Securities and Crowdfunding/Peer-to-Peer Lending Lawyer, Watch more video library | Conference | Interview | Campaign Showcase | Research | Education |