Crowdfunding is about to take the world by storm. With the passage of the JOBSact last year, companies will soon be able to crowdfund early stage investment rounds up to $1 million dollars, from anyone with a pulse and an internet connection.
This will make it really easy for early stage investors to get into some great startups, as well as the person down the street who wants to try out investing in startups.
Crowdfunding will also create a huge market for fraud . Last month we reported on Baltimore startup Asurvest, which will provide insurance to those looking to crowdfund startups.
At SXSW we discovered Washington DC startup CrowdCheck. This company plans to do the due diligence for startups that want to be transparent and offer as much information as possible to potential investors. Startups that utilize CrowdCheck’s services will look more appealing to investors because all of the leg work will have been done already.
CrowdCheck will offer a “badge” or “seal” for startups that use their service. This seal will show that the startup has been through the CrowdCheck process and then link to their CrowdCheck portfolio which will have the information that investors want to know, and that most angel investors look for in traditional angel and seed rounds.
Crowdfunding investors will have a better piece of mind about the startups that use CrowdCheck and they will know they aren’t taking part in a fraudulent transaction.
The team behind CrowdCheck has both legal, and securities backgrounds that make them well versed in all kinds of investment deals. Startups that use CrowdCheck will not only have an advantage while crowdfunding, but should they decide to go for a more traditional angel or seed round, most of the paperwork will have already been done.
Check out our interview video below and for more information visit crowdcheck.com