{"id":2862,"date":"2022-04-08T05:51:40","date_gmt":"2022-04-08T04:51:40","guid":{"rendered":"https:\/\/uk.legalvision.com.au\/?p=2862"},"modified":"2026-01-30T11:41:25","modified_gmt":"2026-01-30T11:41:25","slug":"equity-crowdfunding","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/corporations\/equity-crowdfunding\/","title":{"rendered":"What is Equity Crowdfunding?"},"content":{"rendered":"

Are you a business owner looking for ways to raise capital to finance the next stage in your business’ development? Suppose you are familiar with the general principles of debt and equity financing, but you are particularly curious about equity crowdfunding. This article will provide an overview of equity crowdfunding and then consider the risks associated with crowdfunding and how the equity crowdfunding process tends to work.\u00a0<\/span><\/p>\n

What is Equity Crowdfunding?<\/span><\/h2>\n

Equity crowdfunding, also called “investment-based crowdfunding”, is a way for businesses to raise money by offering shares to platform investors. <\/span><\/p>\n

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This is not a loan, such as what you might get from a bank. Nor is it “loan-based” crowdfunding. Instead, you are effectively selling ownership of your business to the platform’s investors.\u00a0<\/span><\/p>\n<\/div>\n

Equity crowdfunding is an alternative form of equity financing, different from selling shares directly to angel investors or venture capital<\/a> and private equity funds.\u00a0<\/span><\/p>\n

There are three key parties involved in equity crowdfunding. These include the:<\/span><\/p>\n