Crowdfunding Used To Bolster Stalled Startups

Crowdfunding is now becoming a means to bolster stalled startups.

TaskRabbit, once a darling of Silicon Valley, was not finding customer traction and needed more money to keep going.

So, in addition to doing a “down round,” TR opted to raise funds using crowdfunding.

The offer to DreamFunded investors valued each share at less than a third of their value from a previous fundraising round in 2012.

So, crowdfunding continues to offer investors more risk, whether at the startup or retrenchment phase of a company’s growth.


About JeffKoeppel

I am a corporate/securities attorney in the Washington, DC area. Prior to joining the firm, I was a Senior Attorney Advisor in the Division of Corporation Finance at the U.S. Securities and Exchange Commission. I am a member of the Bars of the States of Maryland, New York and the District of Columbia. You can also follow this blog on LinkedIn at:
This entry was posted in accredited investor, checkbook, Crowd Fund Act, Crowd Fund Act of 2012, Crowd Funding At the Margins, SEC, Small Business, technology and tagged , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

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