Am I ready to fundraise on Wefunder?
Before raising from the public, we recommend that you reach out to some potential investors you already know, and get them to make a commitment. Why would a stranger invest in you if the people who know you best won't?
We made this easy to do. After you create a profile on Wefunder, you can use our software to individually invite people you already know to make a non-binding, refundable commitment to invest in your company. We'll hold their commitment in an escrow account. Since it's refundable anytime, no sale of a security has occurred.
It's important that you invite only people you have a pre-existing relationship with, or you are violating the law. For this use case, Wefunder Inc. only supports Regulation D, Rule 506(b), which prohibits advertising.
If you can raise $10,000 or more from people you already know, it is much more likely you can raise money on Wefunder successfully.
If you can raise $10,000 or more, you have three options.
Decide to close a Regulation D round. We'll verify that all investors who made a commitment are accredited investors. Only accredited investors will sign an investment contract and execute an investment contract.1 We charge a flat $2,000 per offering.
Start a Regulation Crowdfunding round. If you can raise $10,000 in commitments, a dedicated account manager will help you file your Form C. After the Form C is filed, you can advertise to the public and accept funds from an unlimited number of unaccredited investors. We'll invite all the investors who made a commitment to invest in your company under Regulation Crowdfunding, and waive all fees for these investors.
Refund the non-binding commitments. There are no fees if you decide not to go through with an offering. All potential investors will receive a refund. (Wefunder will also automatically refund commitments that are 30 days old if no decision is made.)
1. It's legal to accept up to 35 unaccredited investors under Regulation D, Rule 506(b). However, there are prohibitive and costly state laws that vary in all 50 states, which make it very rarely a good idea to do. Wefunder Inc. will only close a Regulation D round with unaccredited investors if a letter is provided from your law firm that attests that state laws have been followed. Otherwise, you must file for a Regulation Crowdfunding round.