StartEngine, one of the largest securities crowdfunding platforms in the US, has filed a Form 1-A to pursue a Reg A+ offering aiming to raise up to $46 million. StartEngine had indicated earlier this year its intent to pursue another funding round after completing a funding round in 2021.
According to the offering document filed with the SEC, StartEngine will also allow certain existing shareholders to sell shares as part of the offering. The offering circular outlines the shareholders who may sell a portion of their shares.
StartEngine provides online capital formation for private firms using the full stack of securities exemptions including Reg CF, Reg A+, and Reg D.
As of December 31, 2021, StartEngine has hosted 64 Regulation A offerings, which have raised a total of $256 million including over $22 million in a campaign for one issuer and four offerings for StartEngine itself. As the funding cap was increased in 2021 (from$50 million to $75 million) StartEngine believes demand will rise for issuers utilizing this exemption.
As of December 31, 2021, 704 Reg CF offerings have raised over $254 million on StartEngine. Reg CF had its funding cap increased as well in 2021 – from $1.07 million to $5 million.
For the first 6 months of 2021 (Jan to June) StartEngine reports a $2 million net income in contrast to the year prior as top-line revenue more than doubled. The offering documents did not include full-year 2021 profit and loss.
An interesting note is that the company states that it is currently required to register its securities with the SEC under the Exchange Act and become a reporting public company. It is in the process of preparing the necessary registration forms, and obtaining financial statements audited in accordance with the Public Company Accounting Oversight Board.
Before the offering goes live on the site the offering must be qualified by the SEC.
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