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StartEngine vs Republic.co 2022: Best Startup Investment?

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StartEngine Review Header

StartEngine Review 2021: Best Startup Investing Platform?

  • Minimum Investment
  • Accessibility
  • Transparency
  • Investment Fees
  • Offering Selection
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Republic.co Review 2022: Best Startup Investing Platform?

  • Minimum Investment
  • Accessibility
  • Transparency
  • Investment Fees
  • Offering Selection
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If you are looking to invest in Startups, but aren’t sure where to start, StartEngine and Republic.co offer a variety of opportunities for beginner investors to get involved with the Startup world. In this blog post, we will compare StartEngine vs. Republic to determine which platform is right for you.

The core difference between the platforms is that StartEngine offers equity crowdfunding through SEC Regulation CF and A+, while Republic offers convertible debt-based investments in the form of a Crowd SAFE.

Both platforms allow investors to sign up for free and charge no commissions on transactions; however, one of these platforms will likely be better suited to your needs than the other based on what type of investor you are!

StartEngine vs Republic.co: Summary

  • StartEngine has a minimum investment of $100 to get started.
  • On the other hand, Republic’s minimum investment is much lower at just $20 depending on the company.
  • StartEngine offers a secondary market for investors to sell their ownership stakes early if they would like.
  • Republic does not currently offer a secondary market though they have plans for one in the future.
  • StartEngine offers investor education, including webinars and events with startup founders to help you learn about investing
  • There is no such educational platform provided by Republic.
  • Both platforms have a similar fee structure where the startup pays the majority (or all) of the fees

 

StartEngine Logo

What is StartEngine?

Founded in 2014, StartEngine is an equity crowdfunding platform for startups to raise capital from investors. The platform is regulated by the SEC, which means Startups can raise up to $50 million in equity crowdfunding campaigns.

StartEngine also allows Startups to run Regulation CF and Regulation A+ offerings through their platform. As a result, Startups have access to capital from a larger range of investors than they would on other platforms.

This is because both accredited and non-accredited investors are able to participate in deals.

How Does StartEngine Work?

Investors can create a free account on StartEngine and browse the current Startups that are available for investment.

Each Startup has a profile page with key information about their business, including how much funding they have raised from investors to date, financial data, and other key investors.

Startup founders can also add in additional content like videos or infographics to help you learn more about their company before reaching out.

If an investor is interested in a particular company, they can submit their investment amount and StartEngine will provide them with the option to pay either in cash or through an electronic check.

The platform provides investors with the opportunity to buy shares in Startups in a variety of ways, including:

Equity Crowdfunding (Reg CF and A+)

Secondary Market. StartEngine allows investors who have purchased equity stakes on its platform to sell their shares if they would like. This is not currently an option for Republic’s investments though it does plan to add this in the future.

StartEngine Features

On the StartEngine platform, investors have access to a number of unique features.

StartEngine Secondary

StartEngine Secondary

In the past, startup investors were only able to see a return on their investment in the case of a liquidity event. Typically, this is either an acquisition or IPO and can take up to 5-10 years, during which point investors are not able to sell their shares.

StartEngine Secondary is a secondary market for investors to sell their startup investments early. As a result, it’s no longer necessary to wait 5+ years to sell out of your investment. Instead, you are able to sell to other StartEngine users that either missed the chance to invest in a company or want to add to their position.

This unique feature is included with StartEngine investments and allows investors the opportunity to buy or sell shares in companies they are invested in at any time after they have made an initial investment.

StartEngine Fees

On the StartEngine platform, most of the fees fall on the startup. There is a 7% servicing fee when Startups raise their capital, which is paid directly to StartEngine.

Startup companies also need to pay a 2% equity fee to StartEngine after a successful fundraise. This gives StartEngine direct ownership in the company.

For investors, there are only two potential fees to watch out for: a 3.5% processing fee, and a commission for selling shares on StartEngine Secondary.

For more information on when these fees may apply, read our full article on StartEngine’s Fees Explained.

StartEngine Pros

  • Invest with as little as $100
  • Open to all investors
  • More than 150 active investment opportunities
  • Very informative fundraising campaign pages
  • Buy transactions have no fees on StartEngine Secondary

StartEngine Cons

  • Investors may pay some fees when they sell their shares on StartEngine Secondary
  • Limited Startups available for investment on StartEngine Secondary
  • Startups have to pay a StartEngine Service fee when raising capital through the platform.
  • Startups need to give up some equity in order to use StartEngine’s services, which can be costly for raising small amounts of money

Republic.co Logo

What is Republic.co?

Republic is a platform built for the future of finance. The platform is meant to give everyone a fair chance at participating in economic opportunity and growth, regardless of wealth and social status – and that’s an important mission.

Republic believes that we need more transparency around financial information so people can make better decisions about where they put their money – whether it’s $25 or $25,000.

As a result, the platform makes startup investing accessible to everyone. Republic allows anyone to invest as little as $20 in startups and have the potential for high returns if those Startups are successful.

Republic’s platform is built on the belief that no matter who you are, where you live, or how much money you make, every person deserves access to economic opportunity – even startup investing.

How Does Republic.co Work?

On the Republic platform, investors can browse through Republic Startups, which are companies that have raised funding and/or graduated from Republic’s startup accelerator program.

Once you decide on an investment opportunity for a specific company:

-You can invest as little as $20 in it with no fees or charges associated with the transaction (since Republic uses crowdfunding to issue securities rather than traditional methods).

-You will get shares in that Republic Startup.

-As the Republic Startups grow and succeed, your investment could potentially increase exponentially. If you hold on to those shares for a certain amount of time (currently at least one year), you’ll potentially reap significant tax advantages.

If the Republic startup has an IPO, Republic will distribute any profits from that IPO to you in the form of a cash payment.

To get a closer look at the interworkings of Republic, check out our article on How Republic Works.

Republic Successful Startups

Republic Autopilot

Picking and choosing individual startups to invest in is a time-consuming process that requires a lot of research. Republic Autopilot takes the guesswork out of startup investing by automatically diversifying your Republic portfolio for you according to risk profiles that are based on each user’s unique circumstances and preferences.

For example, if you want to invest in startups like Uber or Airbnb – but only want small-cap companies with high growth potential, Republic Autopilot will automatically invest in companies that fit those criteria.

By diversifying your investments across different sectors and geographies (and risk profiles), Republic can make sure you’re not exposed to too much risk – but still have the potential for high returns if the startup succeeds.

While Republic doesn’t offer trading tools like other investment platforms, Republic Autopilot can make sure your money is spread across different startups and sectors.

This makes investing on Republic a smart and easy way to diversify your assets while getting exposure to promising companies that you believe in – all with just $20 at a time.

Republic.co Fees

One of the most attractive features of Republic is that investors pay no fees to use the platform. Instead, Republic takes a percentage fee upfront and a small percentage of the Republic Startup’s profits if they have an IPO.

The lack of fees is one reason Republic has grown in popularity over time and was even named the #27 best crowdfunding platform by Entrepreneur.

By not charging investors any fees, Republic is able to offer a wide variety of opportunities for everyone – no matter how much money they make or where they live.

To learn more about Republic’s fees, check out our full article on Republic’s fee structure.

Republic.co Pros

  • No fees for investors
  • $20 minimum investment
  • Access to Republic Startups and other companies on the platform
  • Potential for high returns if those startups are successful
  • Republic Autopilot automates the investing process

Republic.co Cons

  • Limited vetting of startups on Republic
  • No secondary market to resell shares of Republic Startups
  • Number of startups available for investment on Republic can be overwhelming

Republic.co vs StartEngine: Final Verdict

All in all, Republic.co and StartEngine are both unique platforms that have their own pros and cons for investors.

Republic is a good platform if you’re looking to invest in startups with as little money as possible, and access a diversified pool of startups.

While StartEngine has more features for investors who want the option to promote businesses they support or sell shares privately on its secondary market.

Both platforms are working hard to democratize the world of startup investing – and both have the potential to grow as more people discover them!

Happy investing!

Read our full Republic.co Review and our full StartEngine Review for a more in-depth look at both platforms.

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