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Equity Crowdfunding is a solution for some companies, but certainly not all. Most of my clients are not interested in it due to the high costs and complexities. But for some companies it is a viable solution to acquire capital to grow your business.

The following article was authored by a consulting firm called MediaShares. It is intended for companies that would like to raise capital online using equity crowdfunding from accredited and non-accredited investors under SEC rules Regulation CF and Regulation A.

Entrepreneurs and Angel Networks: A Love-Hate Relationship.

You know where I’m going with this if you’ve raised raise capital from an Angel Group.

The claim is that it’s a one-to-many pitch for founders who needs more than family and friend cash – yet have few other options.

There are Angel Groups on every street corner of every city in every state of the union. The good news there is no shortage.

But it is not easy. In fact, it can be a tortuous process. Why?

Here is a link to an interesting report by Pitchbook showing the impact of the reset underway on startups – by sector.

Key takeaways:

1. Deal value and deal count were DOWN across the board – except for Crypto/Blockchain which held serve year over year.

2. Deal valuations were flat or UP across the board – except for Agtech. Climate Tech and Health Tech had the best valuation improvements year over year.

Of course, this is looking in the rear view mirror and does not predict 2023 impacts.

But as reported before, seed and “A” stage startups have been insulated the most from the reset. I anticipate this to continue into the new year and throughout. Having said that, we will need to be aggressive getting and holding investor attention during our campaigns.

Good Thing

On the one hand it is considered a good thing. Think Steve Jobs, Michael Dell, Charles Schwab or Michael Bloomberg. All were founders, entrepreneurs, risk takers and innovators. And they were obsessed with control and getting their way. All of that is helpful to move the needle of success for a startup, and subsequently scaling it. Shareholders love it.

On the other hand……..

Your Business Model is much more than the revenue stream(s).

I shared the following blog as a LinkedIn post a few years ago and it got many thousands of views. It’s worth sharing again.