Investors make money with StartEngine by investing in startups. After an investment is made in a startup, the investor holds private equity in that company. The value of the investment will either increase or decrease based on how the company performs. Investors receive cash or stock if and when a positive liquidity event occurs.
How They Make Money
StartEngine charges a 7% fee of the total capital that is raised for Regulation Crowdfunding offerings. In addition, 2% in equity along with $10,000 in deferred revenue that StartEngine collects when the offering is completed.
What are the Investment Risks
Investing in private equity means that the securities are not publicly traded. This means that they are subject to holding period requirements and should only be invested in by investors who do not need a liquid investment. Investments in private companies are highly speculative and come with a high degree of risk. This risk can include the loss of the investment.