Have you ever wished you could invest in a start-up without having to worry about the tumultuous nature of these types of businesses?
Perhaps you’ve been wanting to get into the start-up investing game but just don’t know where to start.
Or maybe you’re sick of being turned away by countless crowdfunding investment platforms because you are among the many non-accredited investors out there.
If so, Wefunder might be the crowdfunding platform for you. We’ll tell you everything you need to know in our comprehensive Wefunder review. Ready? Let’s get started!
What is Wefunder?
Wefunder is like a combination between crowdfunding and venture capital, allowing investors to benefit from the best of both worlds.
It’s a great opportunity for both accredited and non-accredited investors to invest in businesses and for business owners to raise money for start-up companies.
Simply put, Wefunder connects start-ups to lead investors and vice versa. With an extremely low minimum investment and equally marginal fees, this platform is a great option as you’re searching for alternative investment choices.
According to the creators, Wefunder was built “by founders for founders.” It offers fundraising opportunities for start-ups and provides everyone, from the non-accredited to the accredited investor, the opportunity to access a market that was previously not accessible for most people.
You can download the mobile app on either Android or iOS devices.
How Many Investors Does Wefunder Have?
At the time of writing this article, the Wefunder platform has nearly a million investors!
How Does Wefunder Work?
There are a few ways you can use Wefunder to meet your financial goals and help build private equity.
One is in start-up investing. You only need around $100 to start investing in your favorite start-up, though there are, of course, perks to investing more.
For example, some start-ups offer 10 to 40% discounts on related units or even access to beta testing programs.
When you choose to become a lead investor on Wefunder, you can choose to invest your money in all kinds of companies raising money for their projects. From education to robotics and even film, there are all kinds of options to choose from. You can filter your search to sort companies by their age, percentage of funding, and other attributes as well.
To invest, simply click on the company’s details and type in the amount you want to invest (the minimum investment for that start-up will be listed). You can then flag the listing to watch for updates.
Although Wefunder doesn’t list maximum investment amounts, to adhere to SE guidelines, you won’t be able to invest more than 5% of your annual income or net worth if you are a non-accredited investor with a net worth lower than $107,000.
Most investing experts advise making several small investments in a few different start-ups versus one massive one in a single start-up.
On each Wefunder start-up’s page, you’ll find out how much has been raised so far and be able to invest any percentage of the company you’d like.
It’s different from investing in public companies because there’s a great deal of growth potential. Although investing in a public company comes with less risk, there’s not as much room for exponential growth. It takes time to see results, but the results you can see have the potential to be much bigger.
That said, using Wefunder is different from going out and investing in start-ups on your own because very few are approved on the crowdfunding platform. There’s less risk because of this – the start-ups go through a stringent vetting process.
In addition to investment opportunities, Wefunder also has fundraising opportunities and educational resources you can tap into as well.
To get started with Wefunder, the only cost you’ll have to plan for is the cost of the minimum investment. There are fees once you make that minimum investment (these are maintenance fees charged by the investment platform itself), but you don’t have to pay anything until you invest.
The average minimum investment varies but starts at around $100.
Can You Make Money from Wefunder?
The amount of money you can earn on Wefunder varies depending on the type of investment contract the company is offering.
That said, you can expect reasonable returns. The amount of time it will take you to get that money varies, of course, depending on the success of the start-up you’ve invested in.
Is Wefunder Safe to Use?
Wefunder is safe to use. Although start-up companies are required to disclose their information to the public as part of the investment process, you, as the investor, will have your information totally protected and secured at all times.
Customer Service at Wefunder
Wefunder has a poor rating with the Better Business Bureau – bad news when you’re trying to determine a company’s credibility and attention to customer satisfaction.
Take this with a grain of fault, though. Although the company has had nearly two dozen complaints in the last year, all of these have been satisfactorily closed and resolved.
Some of that poor rating also has to do with factors outside of the company’s control, like the time in business and type of business. Even advertising issues can throw off the rating.
Therefore, it’s important that you take the information in this Wefunder review carefully – as well as the information you read from customer reviews – to find out whether it’s the right platform for you to invest your money in.
Wefunder Pros and Cons
Below are some of the biggest pros and cons of Wefunder for both non-accredited and accredited investors to consider.
Pro: Low Company-Wide Initial Investment
Although the minimum investment varies depending on what kind of start-up you’re investing in, for the most part, the minimum investment is low. It’s much lower, in fact, than what’s required for comparable platforms. This is a major draw for new investors!
Pro: Available to All Kinds of Investors
You don’t have to be an accredited investor to work with Wefunder, which is one of the platform’s major draws. This makes it a great way for public and private companies and investors alike to start investing soon – regardless of how much their net worth might be.
Pro: Investment Rewards Available
With Wefunder, you can receive special “bonuses” for doing certain things. For example, if a company that you invite launches a campaign on the Wefunder site, you can receive $1,000 as an investor.
Pro: International Investing Opportunities
Anyone in the United States can sign up for an account and start investing with Wefunder but what’s truly unique about this platform is that it opens up opportunities for international investing as well.
When you’re looking for opportunities, it’s easy to find what you’re looking for with the helpful search features on the site and app.
Con: Not For Short-Term Investing
If you are going to need the returns you’ll receive from your investing endeavors soon – as in, within the next few years or so – Wefunder probably isn’t for you. Wefunder suggests maintaining an investment timeline of seven years or so.
Con: Startup Investing is Riskier Than Other Types of Investing
Investing in start-up businesses can be risky, particularly compared to other types of investments (like real estate). It’s just so uncertain whether a business is going to succeed or fail in its early days.
The good news about this is that start-ups tend to be binary in their returns. Although investing with Wefunder can be even riskier than investing in the stock market, you’re going to see results pretty quickly – either the start-up you have invested in will be successful, or it won’t.
As you’re looking for the right investment platform to help you meet your needs, know that you have other options to choose from.
Wefunder is one of the best – with one of the lowest minimum investments – but it’s certainly not the only option. Plus, it may not be the best investment platform for everyone.
Two other competitors are Republic and SeedInvest. SeedInvest has a minimum investment that varies depending on the investment but is typically no more than $1,000. Republic has an average minimum investment of just $10 (and 0% fees, too).
SeedInvest’s fees are closer to what’s charged by Wefunder, usually around 2% or up to $300 per investment.
The ease of use and purpose of all three are similar. However, Republic is the only investment platform that allows investors to make investment choices and get investment advice in other areas besides start-ups, like real estate, cryptocurrency, and video games.
Is Wefunder Legit?
As you may have gathered by reading this Wefunder review, this is a crowdfunding platform that can really change the way you think about investing in start-ups. If you want to expand your investment portfolio and explore new ways to build your net worth, this equity crowdfunding platform could be the way to go.
And it’s totally legit. With low investment minimums and plenty of satisfied user reviews, it is an investment platform that’s great for accredited and non-accredited investors.
Just be aware – as is the case with most investment platforms, it’s not designed for the totally risk-averse. When you take the time to do any start-up investing, there’s going to be some element of risk. Keep those risks in mind as you weigh whether Wefunder might be the right choice for you, and get started today!