MicroVentures Overview and Investment Process

MicroVentures is a platform that connects startups with investors, offering a unique way to invest in private companies. It was founded in 2010 by Rett Ross and Brian Nakamura.

The platform allows anyone to invest in startups, with a minimum investment requirement of $100. This makes it accessible to a wide range of investors, from individuals to institutional investors.

MicroVentures has invested in over 300 companies, including popular startups like Uber and Postmates.

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MicroVentures was founded by Bill Clark in Austin, Texas, in 2009. Clark's experience as a credit-risk manager with GMAC Inc., PayPal, and Dell Financial Services (DFS) likely informed his decision to start the company.

Clark decided to found MicroVentures after witnessing the contraction in small-business credit opportunities following the 2008 financial crisis. This marked the beginning of a new era for the company.

MicroVentures completed FINRA's application process in 2010, clearing the way for its growth and development.

MicroVentures was founded by Bill Clark in Austin, Texas, in 2009. Clark had a background in credit-risk management, having worked with companies like GMAC Inc., PayPal, and Dell Financial Services (DFS).

Bill Clark's experience in credit-risk management likely influenced his decision to start MicroVentures. He witnessed a contraction in small-business credit opportunities following the 2008 financial crisis.

After witnessing this contraction, Clark decided to found MicroVentures, which would later complete FINRA's application process in 2010.

In 2012, Tim Sullivan joined MicroVentures as CEO and helped scale the company, leading to a significant increase in deal volume.

Deal volume rose to over $1 million per month by January 2013.

By September 2013, MicroVentures had doubled in size and completed a successful round of fundraising on its own platform.

The company also partnered with the LAUNCH Festival to develop the first mobile crowdfunding app in March 2013.

This app allowed investors to show interest in backing entrepreneurs at fundraising events.

MicroVentures plans to eventually offer real-time investing in startups through mobile.

By February 2015, the company had introduced a 500 Startups Fund and had 25,000 global investors who had deployed over $60 million to approximately 100 companies.

MicroVentures has a rigorous investment process that involves thorough due diligence. They look at prospective early-stage companies across various industries, including technology, consumer products, healthcare, media, and telecommunications.

To be selected for listing, companies must meet specific criteria, such as suitable risk and likelihood of profitability. Less than 0.5% of companies that apply are accepted.

Once a company is listed, MicroVentures posts the results of their due diligence for investors to review. This transparency helps investors make informed decisions.

The average company listed on MicroVentures raises $250,000, while some outliers have raised over $1 million. This wide range is a testament to the diverse needs of startups.

MicroVentures takes a 10% fee from each successful raise, with 5% coming from the issuer and 5% from investors. They also take a 10% carry on successful investments.

MicroVentures has a history of successful primary offerings. In April 2011, the company completed funding for its first three companies, raising a total of $150,000.

One of the notable companies that received funding through MicroVentures was Republic Project, a cloud-based platform that helped advertisers manage digital-media campaigns. Republic Project sold to Digital Generation for a total of $14.5 million in October 2013.

Graphicly also benefited from MicroVentures, raising $300,000 in April 2013. In total, Graphicly has raised $1 million through two separate rounds on MicroVentures.

MicroVentures started strong with its first three companies, raising a total of $150,000 in April 2011.

The first project was Republic Project, a cloud-based platform that helped advertisers manage digital-media campaigns. Republic Project sold to Digital Generation for $14.5 million in October 2013, providing the first liquidity event for investors in an equity crowdfunded company.

Graphicly raised $300,000 on MicroVentures in April 2013, and went on to raise a total of $1 million over two separate rounds.

Yelp was another company that received funding from MicroVentures, raising $100,000 for private shares in November 2011 at a price of $6 to $7 per share.

Secondary Offerings can be a powerful way for companies to raise capital, as seen with MicroVentures' $500,000 fund raised in July 2011 to invest in Facebook.

MicroVentures offered shares of Twitter on its platform beginning in February 2012, and the demand was astonishing, exceeding 300 times the number of shares available.

This highlights the potential for secondary offerings to tap into existing interest in a company, as investors were eager to get in on Twitter's action even before its IPO.

MicroVentures has a team of experts who perform due diligence on start-ups before making them available on the platform. They vet the companies to ensure they have potential for long-term success.

There are two types of investment opportunities on MicroVentures: Equity Crowdfunding and Secondary Trading. Equity Crowdfunding is available to all investors, regardless of accreditation status.

You can start investing in Equity Crowdfunding with just $100. This platform lists start-ups that have undergone a Due-Diligence check by MicroVentures.

Only accredited investors can participate in Secondary Trading, which involves buying and selling shares of mature start-ups. The minimum capital requirement for Secondary Trading is $50,000.

MicroVentures generates revenue by charging fees from companies looking to raise funds on its platform. This includes upfront fees, closing charges, and fees from accredited investors who buy Regulation D offerings.

MicroVentures offers a unique platform for investing in startups, allowing you to diversify your portfolio with as little as $100.

One of the biggest advantages of MicroVentures is the low minimum investment requirement, which makes it accessible to a wider range of investors.

The platform features a curated selection of startups, with over 200 deals available to invest in.

This means you can spread your risk and potentially earn higher returns by investing in a variety of startups.

However, some investors may find the lack of control over investment decisions to be a drawback.

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The platform's due diligence process ensures that only high-quality startups make it to the investment list.

This process includes thorough background checks, financial analysis, and industry research.

Despite this, some investors may still be hesitant to invest in startups without direct control over the decision-making process.

MicroVentures offers a relatively low minimum investment requirement compared to other investment platforms.

This makes it easier for new investors to get started and begin building their portfolio.

However, it's worth noting that investing in startups always carries some level of risk.

The platform's curated selection and due diligence process can help mitigate this risk, but it's still essential to be aware of the potential risks involved.

MicroVentures has a transparent fee structure, with a 5% fee on successful investments.

This fee is relatively low compared to other investment platforms, making it a more attractive option for investors.

However, some investors may find the fee to be a drawback, especially if they're not familiar with the startup industry.

The platform's focus on startup investing can be a major advantage for those looking to diversify their portfolio.

By investing in startups, you can potentially earn higher returns than traditional investments, such as stocks or bonds.

However, it's essential to be aware of the potential risks involved in startup investing.

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MicroVenture Marketplace Inc. has launched a fund that provides investors with access to startups backed by 500 Startups Management Co. LLC, a California-based business accelerator and seed fund.

The fund allows investors to participate for as little as $10,000, offering a low minimum investment requirement.

This fund fills a need for investors looking for more diversification and international exposure, as stated by MicroVenture Marketplace's Founder and CEO Bill Clark.

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MicroVenture Marketplace has launched a fund that gives investors access to startups backed by 500 Startups Management Co. LLC.

This fund allows investors to participate with as little as $10,000. Investors can choose from 100 companies that have already received over $60 million in funding.

The 500 Startups firm was founded in 2010 by Dave McClure and operates with a strategy that makes many small bets to minimize risk and maximize returns.

MicroVenture Marketplace, which operates offices in Austin and San Francisco, is a crowdfunding group founded in 2009 by Bill Clark.

Access to the 500 Startups portfolio fills a need for investors looking for more diversification and international exposure, according to Clark.