What Is Reg CF Crowdfunding?

What Is Reg CF Crowdfunding?

March 18, 2022 by investor

What Is Reg CF Crowdfunding?

Reg CF refers to the SEC regulation for equity crowdfunding.

This form of crowdfunding offers the investor an equity stake in the company.

By contrast, rewards platforms provide the product to those who provide funding.

In equity crowdfunding, the investor must hold the stock for at least twelve months.

Anyone eighteen years of age or older can invest.

By contrast, angel and venture capital fundraises use Reg D which is only for accredited investors.

Equity crowdfunding offers access to shares in companies for a relatively small investment amount.

This gives the investor the ability to invest in more companies.

You must complete a Form C for regulatory purposes before launching a campaign.

Most Reg CF campaigns cost anywhere between $10K and $50K for marketing.

It requires a budget for social media ad spend which is typically around 10%-15% of the fundraise.

You can run the raise on a licensed equity crowdfunding portal or on your own website. 

You can raise up to $5M.

Consider equity crowdfunding for your fundraise as it gives you access to a new investor base.

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Hall T Martin is the director of Investor Connect, which is a 501(c)(3) nonprofit dedicated to the education of investors for early-stage funding. All opinions expressed by Hall and podcast guests are solely their own opinions and do not reflect the opinion of Investor Connect. This podcast is for informational purposes only and should not be relied upon for the basis of investment decisions.