Small investors are so hot to trot.
Wefunder, a leading crowdfunding platform in the U.S., has doubled its own personal fundraising campaign to $2 million from $1 million. The new goal seems like a shoo-in since the company blew past its original $1 million faster than Usain Bolt on an Olympic track.
Founder Nicholas Tommarello says the startup wanted to let more investors in and that they will use the funds to hire “a couple more engineers and have more working capital to invest in future growth.”
In an email exchange, Tommarello seemed pretty laid back about the astonishing success. “This is not new — we’ve raised about $6.5 million from our own users since 2012 via self-crowdfunding. We believe strongly in eating our own dog food — in having our customers also be our investors. I don’t believe any of our competitors are financed this way.”
Does the heavy demand signal something big looming for “Reg Crowdfunding” funding — the new regulation completed in May that would empower small businesses to raise money on crowdfunding platforms? It is part of the JOBS Act legislation passed in 2012. But it took four years for the SEC to draft the rules for implementation.
“As for the $2 million raise, I think it signals more about Wefunder than the sector,” Tommarello writes. “Our investors appreciate that we have about three-quarters market share during the first year of Regulation Crowdfunding, and are optimistic that we’ll grow the market in 2017.”
So far Wefunder has raised more than $15 million in Reg CF offerings in 66 different transactions. Three of the companies on the Wefunder platform have raised $1 million each.