Equity crowdfunding is not a fit for every type of company. For companies that are a fit, we do everything in our power to minimize any potential downside to working with us. If an issuer fails to raise the minimum raise amount that is agreed upon before the campaign, Equivesto won't charge our success fee. The only money that will be spent by the issuer is on any lawyer and accountant fees that they paid before the campaign and the non-refundable application fee that was paid to Equivesto. Review our pricing model here.
After an issuer has gone through the due diligence process and run a campaign, they are most likely eligible to run another campaign without having to pay additional due diligence fees to Equivesto. This is the case even if the first campaign attempt was unsuccessful.
Before running a campaign, it is important for issuers to understand the implications and reporting requirements of having a successful campaign. While they are not onerous, it is important to remember that successful companies will have many more shareholders, which require some time and effort to keep updated. Furthermore, successful companies are required to prepare Annual financial statements to shareholders and host an Annual shareholders meeting (can be done by webinar).
Learn more about what happens after a raise here.