KingsCrowd, a Ratings and Analytics Firm for Private Securities Market, Releases New Regulation CF Report

KingsCrowd, the online private market’s data-driven ratings and analytics platform, announced on Tuesday (April 27, 2021) the publication and availability of the KingsCrowd Regulation Crowdfunding 2018-2020 Intelligence Report.

The KingsCrowd Regulation Crowdfunding 2018-2020 Intelligence Report reportedly covers more than 150 Regulation Crowdfunding (Reg CF) market statistics, key insights, and analytics. These items are presented in an “easy-to-read” visual format. Readers get an extensive overview of the Reg CF market as of last year, along with a preview of what is set to be a “record-shattering” 2021, according to a release.

In 2020, startups secured over $210 million via equity crowdfunding. This total represents year-over-year growth of about 110% from 2019’s total funding and notably marks the fourth year early-stage firms have been able to acquire investment capital from the public under the JOBS Act’s Regulation Crowdfunding rules.

KingsCrowd Founder and CEO Chris Lustrino, stated:

“The release of this first edition of our Regulation Crowdfunding Intelligence Report couldn’t come at a better time. On March 15, the U.S. Securities and Exchange increased the maximum raise amount under Regulation Crowdfunding rules from $1.07 million to $5 million. This marks a watershed moment for our industry and makes Regulation Crowdfunding a viable alternative to traditional venture capital and. KingsCrowd’s Regulation Crowdfunding 2018-2020 Intelligence Report was written for anyone interested in the Reg CF market and looking to update themselves on this fast-growing space quickly.”

A few takeaways from the report:

  • For the year 2020, “more than $210 million was invested in Reg CF raise campaigns.”
  • The average valuation of companies raising funds in 2020 “was $11.35 million, a 24% increase from 2018’s average valuation and up slightly from 2019’s $11.19 million figure.”
  • Second half 2020 data “shows 291 out of 964 start-up companies raised capital exhibited mixed-gender founding teams while 27% of all entities that raised funds through Reg CF included minority founders.”

KingsCrowd says that it’s at the “intersection between early-stage companies seeking growth capital and startup investors.” By offering “institutional-grade” data and analysis that stakeholders can “trust,” KingsCrowd allows anyone to “invest like a venture capitalist.”

KingsCrowd’s Merlin™ Ratings Platform analyzes over 150 data points to offer key insights, analytics, and ratings “to help investors navigate the startup investing market and vet the best deals worth adding to their investment portfolio.”

In late January 2021, Wefunder, a leading securities crowdfunding platform, highlighted Q4 performance in the Reg CF crowdfunding sector. According to the numbers generated by Kingscrowd, Wefunder dominated this sector of online capital formation.

Now crowdfunding encompasses other exemptions, including Reg A+ and Reg D (506c). Each of these exemptions is unique in its own way (Reg D is only available for accredited investors, for example), and many platforms offer securities under all three exemptions, including Wefunder but the bulk of the platform’s securities offerings are from issuers raising capital under Reg CF.

The numbers show Wefunder topping its nearest competitor under Reg CF by almost $10 million:

Wefunder – $29 million
StartEngine – $19.8 million
Republic – $9.9 million
All others – $12.6 million

As covered in March 2020, KingsCrowd closed on a $1 million crowdfunding round on the NetCapital marketplace.  NetCapital lists private securities under both Reg CF and Reg D. The KingsCrowd offering leveraged both exemptions in a side-by-side offering. KingsCrowd said it raised $902,952 under Reg CF and $97,048.80 under Reg D 506 (c). 555,556 units were sold. Kingscrowd is a ValueSetters, Inc. (OTC:VSTR) portfolio company.

You may download a copy of the KingsCrowd’s Regulation Crowdfunding 2018-2020 Intelligence Report here.


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