NextGen Crowdfunding: Title III, Reg CF Crowdfunding Exceeds $37 Million in Investments

NextGen Crowdfunding is out with some data on the status of Title III Regulation Crowdfunding or Reg CF. NextGen has a tracking application that follows all past and active Reg CF offers. According to their numbers, over $37 million has been raised since the securities exemption kicked in on May 16, 2016.  This total includes approximately $4 million in investor commitments for active campaigns that have reached their minimum funding goal. Total Reg CF offers stand at 142 individual campaigns with 113 having successfully closed. The average amount raised under Reg CF that have ended and met their funding goals was about $285,000.

Reg CF currently has a cap of $1,070,000. Until recently the cap was $1 million.  There are multiple campaigns that have raised the maximum amount, including:

  • ElliptiGO
  • Golf Board
  • Hops and Grain
  • Hopsters Brewery
  • HYLETE
  • Legion M Entertainment
  • LiquidPiston
  • Sondors Electric Car

“The first year of Title III data shows that investment crowdfunding is a viable option for many entrepreneurs, startups and small business owners,” said NextGen Crowdfunding CEO and Founder Aubrey Chernick. “Since launching a year ago with only a handful of campaigns, the industry has seen tremendous growth with commitments continuing to rise each quarter.”

Dr. Richard Swart, Chief Strategy Officer of NextGen, said there had been an uptick in activity in both March and April of this year.

“[This] suggests that platforms are getting better at helping companies launch. Costs for issuers are also declining, meaning that attorneys and accountants are figuring out more cost effective models to help these firms. These are very positive signs for any company looking to use Title III,” explained Swart.

Reg CF allows smaller companies to raise money online from anyone (not just accredited investors). Companies may list offers via FINRA approved crowdfunding portals or Broker-Dealers. This securities exemption, along with Title II (Reg D 506c) and Title IV (Reg A+) of the JOBS Act of 2o12, ushered in a new era of leveraging the internet to connect companies in need of growth funding with investors online.