CrowdCheck Blog

Startup and early stage companies frequently change their product, selling strategy, or business plan to adapt, when their prior actions are not leading to profits or a scalable business.  These "pivots" may revamp the company into something very different than what was originally presented to investors.  Investors must bear in mind that these changes happen, but consider whether the entrepreneur gave sufficient warning about the possibility of a change in plans.

Startup and early stage companies frequently change their product, selling strategy, or business plan to adapt, when their prior actions are not leading to profits or a scalable business.  These "pivots" may revamp the company into something very different than what was originally presented to investors.  Investors must bear in mind that these changes happen, but consider whether the entrepreneur gave sufficient warning about the possibility of a change in plans.

Financial statements prepared on the basis of some assumed events and transactions that have not yet occurred are referred to as “pro forma” financial statements.  These statements have not been audited and are not prepared in accordance with generally accepted accounting principles.  It is important that the investor understand the assumptions underpinning a pro forma financial statement and question the basis for those assumptions. Investors should ask whether any third party has investigated…

Financial statements prepared on the basis of some assumed events and transactions that have not yet occurred are referred to as “pro forma” financial statements.  These statements have not been audited and are not prepared in accordance with generally accepted accounting principles.  It is important that the investor understand the assumptions underpinning a pro forma financial statement and question the basis for those assumptions. Investors should ask whether any third party has investigated…

Preferred stock combines elements of equity and debt securities. The holder of preferred shares may receive a set dividend from the company according to the terms of the preferred shares. If the company fails, preferred shareholders receive a portion of the liquidation after debt holders are made whole. Preferred shareholders typically do not have voting power in shareholder elections.

Preferred stock combines elements of equity and debt securities. The holder of preferred shares may receive a set dividend from the company according to the terms of the preferred shares. If the company fails, preferred shareholders receive a portion of the liquidation after debt holders are made whole. Preferred shareholders typically do not have voting power in shareholder elections.

The sale of securities to the public after registering with the Securities and Exchange Commission. The CROWDFUND Act makes an exception to the registration requirements for a public offering. Crowdfunding offerings to the public under the CROWDFUND Act do not have to be registered with the SEC, but must follow specific rules.

The sale of securities to the public after registering with the Securities and Exchange Commission. The CROWDFUND Act makes an exception to the registration requirements for a public offering. Crowdfunding offerings to the public under the CROWDFUND Act do not have to be registered with the SEC, but must follow specific rules.

The sale of newly issued debt or equity securities to a single buyer or limited number of buyers without a public offering.

The sale of newly issued debt or equity securities to a single buyer or limited number of buyers without a public offering.