Rule number one of investing has always been to invest in what you know. With the world of investing being as wide open as it’s ever been and so many opportunities now available, rule number two should be to invest in what you believe in.
These rules are similar to an extent, but you can know a lot about an industry or a sector, but not really be all that passionate about it. When you can put your money into something that you really, truly believe in, it’s exciting. You can feel like you’re a part of something bigger than yourself, making the world a better place, not just sending your money off to some corporate giant in the hopes of getting some nice returns.
One of the ways I discovered a crowdfunding site to do this is a site called Wefunder.com. Start-ups listed on the site are well-vetted and looking for a variety of funding to raise capital. Some are raising funds as seed capital, others have already gone through several rounds of capital raising. I’ve already pledged my money to a few early stage companies through this site and I’m continuously looking for more opportunities and so should you. Here’s why…
Invest in Any Industry
Wefunder allows you to find start-ups of all shapes and sizes looking to raise money. Some are brand new; others are a little more established. No matter what you are interested in and passionate about, you’ll likely find it here. Technology, check. Entertainment, got it. Food and Alcohol, double-check.
Are you into health and fitness, they have it. Maybe you want to make a social or environmental impact, they still have you covered. I could show a list a mile long off all the category types they have, but the point is if you have an interest in it, you’ll find it there.
Invest by Who’s in Charge
Not only can you find companies in all different industries, but Wefunder also gives you the ability to invest in early-stage companies based on the founders allowing you to invest in startups based on who matters to you. With options to invest in companies founded by women and\or a member of a minority, you can not only show your support but maybe inspire your children to strive for excellence as well.
Root for the Little Guy
As I mentioned earlier, the companies listed on Wefunder are all at different stages of development and looking for investors. Some are a brand new business that is literally a one-man show with no sales yet, while others are already well established with millions in revenue.
There is even an option to invest in start-ups relatively near you. Investing in a company that already has millions might not have the same impact as it would for someone just starting out, you can decide which one is right for you.
Perks and Updates
Many of these companies are very thankful for your investment and are willing to give you some perks in return. These mostly are along the lines of making you a walking advertisement in the form of a hat or t-shirt, but in some cases, they may even send you their product! Either way, you can proudly show off your swag so when the company makes it big, you can prove you played a small part in it.
You’ll also receive periodic updates from your investments. This could be as simple as a two-sentence post or as much as a twenty-minute video showing the updates on anything and everything. It’s fun watching an investment being built from scratch, you don’t get that with the stock market!
Money of Course
For as passionate you might be about something, investing is still about growing your money. Each company has different agreements as to how you’ll eventually make any of your investment back. Some are as simple as paying you back a multiplier of your investment, some offer equity in the company in the form of future shares if it ever has an initial public offering, others have more complicated payback methods like equity debt.
Before making any investment, make sure you understand the agreement type. Investing in startups is usually reserved for wealthy accredited investors (high net worth) with much more capital to invest. Now that you have access as an individual investor, you can get in on the action and potentially see types of large gains typically reserved for the big guns.
Wefunder is a site full of early-stage companies doing wonderful things that are looking to raise funds. Whatever your passion, you’ll find a way to invest in it here. When looking to invest, you shouldn’t lose sight of rule one though, as with any investment, make sure you understand what you are getting yourself into. If you are solely looking for a big payday, you might find it here, but you should be ready to lose anything you invest as well.
The site is relatively new, so there is no proven track record of having successful companies listed on the site. There is no guarantee the company you invest in will continue to exist, be profitable or ever be publicly traded. Even so, just having the opportunity to invest in something you believe in is a great feeling.
Have experience with angel investing, venture financing, VC funding, or just have general investment advice? I’d love to hear about your experiences in the comments!
Jeff is a fan of all things finance. When he's not out there changing the world with his blog, you can find him on a run, a Mets game, or just playing around with his kids