Equity Crowdfunding
Definition
Equity crowdfunding sells actual shares (or share-equivalents) to many small investors through regulated online platforms, under frameworks like US Regulation Crowdfunding.
How it comes up in fundraising
Startups with consumer audiences sometimes raise community rounds this way, turning users into shareholders.
Frequently asked questions
How much can be raised through equity crowdfunding?
Up to $5M per 12 months under US Regulation Crowdfunding, with escalating disclosure requirements.
Does equity crowdfunding complicate the cap table?
Modern platforms pool investors into a single entity, keeping one line on the cap table; older direct-share models created real mess.
Related terms
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