The founder of OurCrowd, Jon Medved, is a serial entrepreneur and venture capitalism. His company, Israel Seed, has raised over $252 million for capital ventures and has contributed investment capital in over 100 start-up companies in Israel. Co-founder, Steven Blumgart, was formerly the Glencore International senior management team member where he was responsible for their aluminum business portfolio.
OurCrowd is a crowdfunding platform which is equity-based and works with only accredited investors. Venture capital was originally based in the raising of capital funding for Israeli start-ups but has since diversified to a global marketplace. Minimum investments by accredited investors begin at $10,000 per deal and membership is available for only for vetted investors and offered only to those who meet the highest due diligence standards. This platform offers pre-negotiated term sheets and money will be invested by OurCrowd and its affiliated network of mentors. This company is one of the only companies that is a leading provider and offers only accredited investors.
This platform is different from other forms of venture capital raising as traditional Venture Funds have dropped and most don’t want to invest in beginning stage ventures. These formats require large investments, have high level commitment, and carry huge management and carry fees. Equity crowdfunding allows investors more control over how and where to put up their investment, lowers the associated fees, and allows them to choose interests they are truly interested in rather than what is traditionally available.
OurCrowd manages the process by sourcing, vetting, and organizing campaigns which they then present to investors. Investors are able to put up as little as $10,000 and pay substantially lower fees and associated costs in comparison with Venture investments. The platform uses specialized software to make investing a painless and simplified process and ensures all due diligence has been met. This further simplifies the process for investors and entrepreneurs as OurCrowd’s attention to detail means less risk is involved. The company invests in various projects and isn’t willing to take unnecessary risks in those regards so all those niggling little details have been paid proper attention from the onset.
This platform will not register as a crowdfunding portal under the JOBS act as it is exempt by the act’s regulations. This company uses only a restricted and exclusive group of investors which are accredited and does not open its campaigns for investment by the public which offer it exclusion from the private company funding regulations set out under the current act.
Registering for OurCrowd is open to journalists, founders, or accredited investors only and once all required criterion are met, OurCrowd will grant access to log in to their site. This then allows investors to browse through companies which are available to receive investments, view all required details surrounding the potential investment, and make decisions appropriately. At times, additional criteria must be met to invest in particular business ventures in regards to accreditation.
Available information surrounding potential investments can include presentations, deal terms videos, backgrounds, analysis, and much more. It is also possible to meet or call with the company’s management team or participate in a webinar. Making an investment is quite easy and only requires that you type in the amount to be investment and click a button. OurCrowd will then allocate based on a first-come first-served and pro-rata calculation and sent the required documentation to finalize the deal in addition to payment transfer instructions.
Deal documentation is intended to protect all parties involved and will require certification that you meet various regulations in your country such as income or asset qualifications and any experience criteria which may be required. American investors must have their accreditation certified by a licensed professional to verify all US qualifications have been met.
This platform opens up the playing field for those who were just not willing to invest amounts upwards of $1 million for traditional venture investments, allows companies to diversify and spread their overall investment around between various businesses and puts them less at risk of immense loses should the company flop. While returns on massive investments have the potential to rake in larger overall returns, the overall loss should the unthinkable occur is much more easily managed for smaller accredited investors. The risk of losing money is still there just like any other investment and all investors are advised to use prudence when putting up their money towards any investment and to ensure they will not be crippled by any loss incurred.
Fees for investing in OurCrowd are based on numerous factors which are explained in their fee schedule and a sample investment is included to help visualize how it all works. Suffice it to say that the fees involved are substantially lower than traditional venture investment and the handy comparison chart breaks down just how much of a difference there is between the two investment types.
As for the businesses available for investment, they are extremely diverse and can range from advanced new medical technology to unique ideas like social bike sharing to promote environmental responsibility and budget friendly transportation resources. Investment options available allow true portfolio diversification and can allow you to access a broad range of categories.
Additionally, great thinkers are able to expand or begin their business ventures to create world-changing products much more quickly than they would trying to raise funds using traditional methods. This is great news for society in addition to investors and entrepreneurs because it allows concept products to find their way to the real world quickly enough to make a difference and meet the needs of society as a whole. These investors don’t just invest in a new company; they’re investing in expansion of the labor force because small business is the main provider of jobs across the country; they’re investing in expansion of the economy and helping it to stabilize; and they’re investing in the ability to change the lives of people around the globe one investment at a time.
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