FAQ

Building a campaign

How do I get started?

Hit that green button in the upper right corner and Sign Up to become involved in the community. Once you start to build out your profile, we make it easy for you to fill out the campaign application form allowing you to get your campaign off the ground.

Does it cost money to create a basic profile?

It's free to sign up, build your user profile, and search other offerings to see how other's design their campaign pages.

Can I create a profile and not raise funds or commit to investing?

Absolutely! We suggest creating a basic profile to understand how the process works on both sides and to start collecting followers before starting to fundraise.

Are there legal issues I need to be aware of when making a profile?

When you build a crowdfunding campaign, the biggest thing to watch out for is making any false promises. As a new company, you can't predict the future, so promising explicit revenue targets and specific growth numbers can be misleading. You are liable for every statement that is not true. Since you're dealing with investors now, you also cannot withhold relevant information that could affect their decision to invest (e.g. a pending lawsuit). For more information on the Crowdfunding Rules for Issuers, please visit THIS SITE.

Are there eligibility requirements for my company to create a campaign?

Before you can issue an offering on Wunderfund.co, you have to apply and tell us about your team and your company. We look for a complete business plan, pitch deck, financial information and other relevant historical information that we review for preliminary due diligence. Only companies that get through this preliminary due diligence criteria will be permitted to raise funding. Passing this process is not meant to be construed as investment advice or endorsement by Wunderfund.co.

Do you run background, criminal, and credit checks?

Yes, as per government guidelines, we will run a background check and credit check on all issuers.

How much fundraising can be raised for each campaign?

The range at which any company can raise on our website is anywhere from $25,000 to $1.07 million.

Are the company's confidential documents secure? Can anyone see those?

According to Regulation Crowdfunding Rule 303(a), you are required to make publicly available all the information provided with the offering; without requiring registration or the establishment of an account. Therefore, offering information about your company will be shared to any Wunderfund.co users in order for the investment community to make informed investment decisions.

Fundraising

When am I ready to start funding on Wunderfund.co?

We fund companies at all stages but we recommend that if you fundraise on Wunderfund.co, you have some proof points that can convince investors you can "get stuff done" and are not just in the idea stage. While there are no requirements, we recommend at least one experienced investor that supports your company. It also helps to have at least a working prototype, and ideally, a few paying customers. But before then, create a free profile, and start collecting followers!

Can I edit anything in my campaign after it is launched?

Yes, your campaign is updateable after it is launched. However, any change made after your campaign is launched requires notification to any investor already committed to funding your campaign that they must re-commit their investment to your campaign. This means an update could lose you investors, so make sure you are 100% satisfied with your initial profile.

How many investors can participate in a round?

This depends on the minimum investment size, which you can set when you build your campaign. For example, if you set a minimum investment size of $1,000 on a target goal of $100,000, it's possible 100 investors could participate in the round. It's common for investors to make larger investment sizes than the minimum, which would affect the maximum number of investors.

Will all the investors have voting rights?

Voting rights will be determined by the offering and will be disclosed to investors before a commitment has been made. Generally, minor investors, such as those investors using the Crowdfunding exception, are not granted voting rights by the issuer.

Does Wunderfund accredit investors?

At this time, we do not provide this service. In the future, we plan to do so.

What rights will investors who invest through Wunderfund.co have?

Your offering will set the investors rights in the terms of the offering and investor agreement. We have a standard template available, which you can choose to review with your own legal counsel.

How is my company's valuation determined?

You will set the valuation of your company as the entrepreneur of the campaign. We offer due diligence if needed to determine your company's valuation for an extra cost.

How does Wunderfund.co make money?

The portal is designed to help entrepreneurs raise funds for their startups. If you reach your target goal, you pay a 6-8% sliding fee based on the total amount (the greater the raise, the lesser the fee). This covers the cost of structuring a proper offering for investors, providing legal templates, managing e-signatures, overseeing escrow services, and ensuring you're fully compliant with SEC regulations. To launch the campaign, we charge a $500 non-refundable fee, which is credited back if you reach your funding goal.

Promoting

At what points am I allowed to promote my campaign?

You can begin promoting your campaign only after it is enabled on Wunderfund.co. Before then, you can publicly share your personal profile, and ask others to "follow" you. However, you cannot legally say that you are in fundraising mode or share any details about your planned offering until it has officially launched. Per legal guidelines, you are not allowed to say, "we plan to begin fundraising on July 4th for a total raise of $500K." You must also avoid saying things like, "Once we file with the SEC..." They frown upon that.

What legal considerations should I be concerned about when advertising?

You may not, directly or indirectly, advertise the terms of an offering except for notices that direct investors to Wunderfund.co and includes no more than the following information:

  • A statement that you are conducting an offering pursuant to Section 4(a)(6) of the Securities Act;

  • Identify Wunderfund.co and provide a link directing the potential investor to our website;

  • Basic details of the offering; and

  • Factual information about your legal identity and business location, limited to your name, address, phone number and Web site, the email address of a representative and a brief description of your business.

You may communicate with investors and potential investors about the terms of the offering through communication channels provided by Wunderfund.co, provided that you identify yourself as the issuer in all communications. Persons acting on your behalf must identify their affiliation with the issuer in all communications on Wunderfund.co.

How can I communicate with investors?

You may communicate with investors and potential investors about the terms of the offering through each campaign's comments channels provided by Wunderfund.co, provided that you identify yourself as the issuer in all communications. Persons answering questions and promoting on an issuer's behalf must identify their affiliation with them in all communications on Wunderfund.co. Failure to identify yourself as the issuer or an identity that has a financial relationship with the issuer will exempt the issuer from our platform.

Post-campaign

How do I close my campaign?

Once the deadline hits, the campaign will automatically close and not accept any more investors. If the funding goal was reached, investors will be notified and it will take about 5 days for the funds to go through.

What happens if my campaign doesn't reach its funding goal?

None of the money invested goes through and it goes right back to the investor. You are allowed to start a new campaign a month after the closing date of the original offering. Use this 30-day buffer to gain more followers, improve your numbers, and do anything that might boost your investments for the new campaign.

How do I engage with all of my investors once the campaign is closed?

It's up to you to keep your investors updated with regular communications about your company's progress. At a minimum, we encourage quarterly financial updates via email or newsletter be sent to your investors. This way, they can provide input, advice, or connections that might be helpful for you.

Is it possible to extend my deadline if the fundraising goal has not been met?

Yes. However, this is a material change that requires all of your investors to reconfirm their investment, so note that you might lose some investors. Sill, it's a better option than not reaching your funding goal.

How often should I provide updates after the campaign is closed?

You are required by the SEC to file an ongoing report at least once a year at the minimum, but we encourage you to provide quarterly financial updates via email or newsletter to your investors.

Glossary

Common stock

Common stock is a security that represents ownership in a corporation. Holders of common stock exercise control by electing a board of directors and voting on corporate policy. Common stockholders are on the bottom of the priority ladder for ownership structure; in the event of liquidation, common shareholders have rights to a company's assets only after bondholders, preferred shareholders and other debtholders are paid in full.

Fund

A fund is a legal entity that manages money from investors seeking private equity stakes in startup and small- and medium-size enterprises with strong growth potential. Investors in the fund own units in the fund; the fund itself owns equity of private companies.

JOBS Act - Title III

Title III allows individuals to make investments in small companies without being accredited investors. The company is allowed to receive up to $1 million over any 12-month period. Investors may not purchase more than $2,000 in offerings or a certain percentage of his or her annual income or net worth as long as it is under $100,000 during a 12-month period.

Liquidation preference

A term used in venture capital contracts to specify which investors get paid first and how much they get paid in the event of a liquidation event such as the sale of the company. Liquidation preference protects investors by making sure they get their initial investments back before other parties. If the company is sold at a profit, liquidation preference can also help investors be first in line to claim part of the profits. It is common for venture funds to be repaid before holders of common stock and before the company's original owners and employees.

Preferred stock

A preferred stock is a class of ownership in a corporation that has a higher claim on its assets and earnings than common stock. Preferred shares generally have a dividend that must be paid out before dividends to common shareholders, and the shares usually do not carry voting rights.

Preferred stock combines features of debt, in that it pays fixed dividends, and equity, in that it has the potential to appreciate in price. The details of each preferred stock depend on the entrepreneur.

Pro rata rights

Pro-rata rights help ensure that as an early investor in a company you have the option to maintain your equity stake as the company raises more capital. In other words, if a company you acquired 10% of has a valuation of $10M decides to raise $10M at a $40M valuation a few years later, with pro-rata rights, you have the right to invest another $1M and keep your 10% because you were an early investor. If you didn't have pro-rata rights, it would be first-come, first-serve and the bigger check wouldn't be taken into account.

Seed round

Seed Round funding involves an investor making an early stage investment in a company in return for a share of the company. This can be an investment made by a family member or friend, an angel investor, and even through crowdfunding.

Transfer Agent

A transfer agent keeps track of the individuals who will own securities in your company. If you successfully raise capital, you may want need the capability to manage the investor list. A transfer agent can manage investor relations, keep track of the shares and amounts your investors own, and help you manage your payments due to investors for debt offerings. If you don't have one, we recommend using Transfer Online. Note: Transfer Online includes a $99 setup fee, and depending on the transfer agent you may use, they too may have setup fees of their own.

Valuation

Valuation is the process of determining the current worth of an asset or a company; there are many techniques used to determine value. An analyst placing a value on a company looks at the company's management, the composition of its capital structure, the prospect of future earnings and market value of assets.

Bitnami