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Know the risks
You'll probably never see this money again. Most startups don't make it. A Crowd SAFE pays only if the company later raises a priced round or is acquired. Invest in people because you believe in them.
Five statements
Before a first commitment, you acknowledge five statements. Each has its own checkbox. Each is required. Later commitments ask you to confirm them again in one line.
- I understand I will probably lose all of this money.
- I understand a Crowd SAFE pays only if the company later raises a priced round or is acquired. Neither may happen.
- I understand I cannot sell or transfer this for 12 months. A buyer may never appear after that.
- I understand I can cancel until 48 hours before the close. After that the commitment is final.
- I understand Fools does not review, rank, or endorse this company. Nothing here is advice.
What a Crowd SAFE is
A Crowd SAFE is not stock. It converts into stock if the company later raises a priced round. It pays out if the company is acquired. If neither happens, it may be worth nothing. It carries no interest, no repayment date, and no vote.
Read the full Crowd SAFE guide. The guide includes a conversion calculator.
You cannot sell it for 12 months
You generally cannot sell or transfer a Crowd SAFE for 12 months after you receive it. Within that time you may transfer it only to the company, to an accredited investor, to a family member, or in an offering registered with the SEC. After 12 months there may still be no buyer.
You can cancel until 48 hours before the close
You can cancel a commitment until 48 hours before the round's close. After that it is final. The cutoff date and time appear in the commit steps and in your portfolio.
Your limit
Federal rules cap your total Regulation Crowdfunding investment in 12 months. The cap counts offerings on other platforms too.
If your annual income or your net worth is under $124,000, your limit is 5% of the greater figure. That limit is at least $2,500. If both are at or above $124,000, your limit is 10% of the greater figure. That limit is at most $124,000. Your primary home does not count toward net worth. Fools asks for both numbers to state your limit before you choose an amount.
All or nothing
Each round sets a target and a deadline. Our licensed broker-dealer partner holds commitments until the deadline. If the round meets its target, the money moves to the company and the Crowd SAFE is issued. If the round misses its target, the commitments are returned.
Fools does not review, rank, or endorse
Nothing on Fools is advice. The screening room plays pitches newest first. You can also sort by closing soonest or alphabetical. Federal crowdfunding rules allow only objective, factual order. You see each founder's own pitch. After a round files its Form C, its offering statement is public on the SEC's EDGAR site.