New Way to "Cash-in" on Startups?

By Matthew Milner, on Wednesday, September 8, 2021

Here’s a riddle for you:

What do drones, tequila, and renewable energy have in common?

And here’s the answer:

They’re all made by startups that you can invest in today.

But I’m not writing today to tell you about drones or energy startups. Instead, I’m here to tell you about the company that gives you investment access to these startups.

Essentially, this company is aiming to become the E*Trade of the startup world…

And now you have the opportunity to invest in it…

55% Annual Returns

There are many good reasons to invest in startups — from the excitement of being involved with something at the ground floor, to the boost it gives the economy.

But perhaps the best reason of all is the profit potential.

According to Cambridge Analytics (an advisor to institutions like The Rockefeller Foundation, Harvard University, and the Bill Gates Family Office), investing in startups has returned 55% per year over 25 years.

That trounces the returns from the stock market, which returned just 8% per year during the same period.

Here’s how to put the difference between 8% and 55% into perspective:

At 8% per year, a $5,000 investment would turn into $10,000 in ten years…

But at 55% per year, that same $5,000 would turn into $400,000.

And that leads to our next riddle:

How can you get access to these investments?

Funding Platforms Have Already Raised $500 Million+

You can’t invest in startups on stock-trading websites like E*Trade or Schwab. And you can’t get access to them from your stockbroker.

Instead, you find them on a new type of website called a Funding Platform.

These platforms connect investors like you to startup investments — and in the last few years, they’ve helped these startups raise more than $500 million.

One of the most popular platforms is called StartEngine…

StartEngine’s Progress

StartEngine was founded in 2014 by two long-time entrepreneurs:

Ron Miller, a recipient of the “Inc. 500” award who’s built and sold five startups…

And Howard Marks, the founder of Acclaim Games (acquired by Disney), and former Chairman of video game leader Activision (NASDAQ: ATVI).

In exchange for connecting investors like you to startup deals, StartEngine makes money in a few different ways, including:

Commissions — It charges 7% to 12% of the funds it helps raise.

Equity — It charges an additional 2% of funds raised in equity, so if these companies are successful in the future, StartEngine takes part in the upside.

Service Fees — It charges fees to startups to launch and manage their campaign.

In 2020, StartEngine earned $12.5 million. That’s not bad for a young company. But its recent initiatives indicate that it’s just getting started…

StartEngine’s Future

StartEngine is positioning itself to become the “go-to” platform for all things related to early-stage funding.

For example:

It created a “Secondary Market” that enables investors to buy and sell startup shares before the startup is acquired or goes public. This means you could potentially turn your private shares into cash at any time.

And it recently signed on Kevin O’Leary (also known as “Mr. Wonderful,” from the hit TV show Shark Tank) as an advisor and spokesperson.

If StartEngine can succeed with its new initiatives, it’s got a shot at becoming the E*Trade of the startup world…

But to get there, it needs more capital to grow, which is where you come in…

An Investment in StartEngine

StartEngine is currently raising up to $55 million.

And given its mission, it’s raising that capital from investors like you, with a minimum investment of $500.

2,750 investors have already committed a total of nearly $5 million.

There’s just one big thing potential investors need to keep in mind:

The valuation for this round is nearly $800 million. For a company doing $12.5 million in annual revenues, that’s high…

To make 10x your money — that’s our target return for any early-stage investment — StartEngine would need to be acquired or go public for at least $8 billion.

But if the company can achieve its goals, that’s not out of the question. After all, E*Trade was acquired last year for about $13 billion.

To learn more about StartEngine and its funding round, click here »

Happy Investing

Please note: Crowdability has no relationship with StartEngine, or with any of the companies or platforms we write about. Crowdability is an independent provider of education, information, and research on startups and alternative investments.

Best Regards,
Matthew Milner
Matthew Milner


If you enjoyed this article, subscribe to updates:

Sign-up today and you'll receive our daily insights on early-stage investing, as well as our FREE "Equity Crowdfunding Action Kit" – where you'll learn:

  • The Ins & Outs of Equity Crowdfunding
  • A step-by-step path to get started
  • Tips from dozens of Venture Capitalists
subscribe to updates

Thank you for subscribing!

Tags: Startups StartEngine

Share This:
comments powered by Disqus