Indiegogo, one of the largest US crowdfunding platforms by funds raised, announced in a blog post that it has teamed up with equity crowdfunding platform MicroVentures to offer everyone the option to invest in startups and growing companies.
Usually equity crowdfunding is available mostly to accredited professional investors and not the general public. The passing of the equity crowdfunding rules passed by the US Securities and Exchange Commision (SEC) as part of the 2012 JOBS Act, however, allow anyone the opportunity to invest in companies online in exchange for shares in the company.
“We were proud to be involved in helping craft the 2012 JOBS ACT and firmly believe access to capital shouldn’t be restricted to a small, select group of individuals,” noted Slava Rubin, Chief Business Officer of Indiegogo.
The partnership between Indiegogo and MicroVentures allows investors use their combined networks to buy shares in selected innovative startups.
Currently the two platforms offer equity investment in four companies: the developer of a Massively Multiplayer Online Role Playing Game (MMORPG), an athletic ball connected to mobile devices, a distillery and craft cocktail bar and a social marketplace for music collaboration.
Indiegogo is a reward-based crowdfunding platform in which financial backers get a gift or a discount for the product or service offered, instead of equity in the company offering it. It was launched in 2008. So far nearly 250 000 people have raised over $1 billion for various projects, products and causes.
MicroVentures launched in 2011 and is a FINRA-registered broker dealer. Among the more notable companies that have been funded through its platform are Twitter, Facebook and Yelp, before their IPOs. It is among the first equity crowdfunding platforms to offer mobile crowdfunding app that allows investors to show their interest in backing entrepreneurs at fundraising events. So far the platform has raised more than $100 million through investors and more than the 95% of investment opportunities are funded.