Access a range of impact investments using the world's most popular crowdfunding platform.
Wefunder is one of the most popular crowdfunding platforms in the world. While it doesn't exclusively focus on impact investments, the platform offers several impact investment opportunities that span renewable energy, affordable housing, and other areas. As a result, impact investors should keep it on their radar.
Let's take a closer look at who's behind Wefunder, how the platform works, and whether you should use it to invest.
Who's behind Wefunder?
Nick Tommarello and Greg Belote founded Wefunder to invest in their friends and help them dream bigger, become the best versions of themselves, and reach their ambition. After the JOBS Act opened the door to equity crowdfunding, the two sought to build the Robinhood for pre-IPO startups, where anyone could angel invest.
As of 2020, Wefunder has become the largest funding portal for crowdsourced investing, measured by the number of investments, investment volume, and investor returns. But beyond its commercial success, Public Benefit Corporation aims to fix capitalism by democratizing access to private investments.
How Wefunder works
Wefunder's platform provides access to hundreds of startup opportunities, including many impact investments. For example, you can invest in tech-enabled community solar platforms, edible and compostable cups, or containerized affordable housing projects. However, not all projects on the platform are impact-focused.
These offers come in many forms, including:
- Convertible Notes
- Revenue Shares
- Common Stock
- Preferred Stock
- Common Units
- Promissory Notes
When you find an opportunity you like, you can create an account, input how much you'd like to invest (there's a $100 minimum), and begin the process. Depending on the deal, you may indicate interest with a "reservation" or invest on the spot. There may also be rewards for different investment levels (e.g., $1,000 or $5,000).
The following steps depend on the investment. For example, if you made a debt investment, you would receive repayments based on the agreed-upon schedule. However, equity investors don't typically see any returns until the company goes public or is acquired, which can take a very long time (e.g., five or ten years or even more).
Why invest with Wefunder?
Wefunder is the largest crowdfunding platform in the United States, with hundreds of different opportunities – including many impact investments. In addition, the company itself is a Public Benefit Corporation seeking to democratize finance. And it publishes an impact report each year detailing these efforts.
Of course, you should remember that Wefunder opportunities are private investments with greater risk than publicly-traded securities. For example, equity-only investments may not offer any financial return for years, and even debt securities have higher credit risk than most publicly-traded bonds. As a result, investors should exercise caution.
That said, Wefunder is an excellent way to diversify an impact portfolio with impact startups. These companies may have more growth potential than publicly-traded securities, while their valuation may not depend on overall market conditions. There are also many types of securities to choose from to find your need.
The bottom line
Wefunder is the largest crowdfunding platform in the United States, offering a variety of impact investments. In addition, the Public Benefit Corporation is working to democratize access to private investments and help startups achieve their goals. As a result, it's a valuable platform for investors looking to expand their portfolios.
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Dec 08, 2022
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- Invest in high-impact startups with as little as $100.
- Browse hundreds of different opportunities.