article thumbnail

7 Equity Crowdfunding Risks Feared By Many Investors

Startup Professionals Musings

Startup investors have no insight to management or governance. Startups are not required to have a formal Board of Directors, and can’t afford to implement many of the financial and operational controls required of public companies. Crowdfunding stock owners cannot sell their stock, or buy more, increasing risk to all parties.

Equity 180
article thumbnail

On the Road to Recap:

abovethecrowd.com

The reason these terms can produce returns by themselves is that they set the stage for a rejiggering of the capitalization table at some point in the future. The reason we are all in this mess is because of the excessive amounts of capital that have poured into the VC-backed startup market. This is uncharted territory.

IPO 40