Prior to the advent of alternative investing platforms like Netcapital, those who wanted to invest early in a startup were largely limited to speculating on either initial public offerings or over-the-counter stocks. However, Netcapital bridged this opportunity gap, bringing everyday folks to compelling startup investments.
Now, you don’t have to wait around like everyone else on a potentially hot IPO. Because in this traditional method, being first isn’t technically true. And there have been enough times where a much-hyped public debut quickly crumbled that being front of the line isn’t necessarily a good thing.
This is one of the reasons why so many financial experts believe that Netcapital’s offerings of intriguing startup investments is a potential game changer. Finally, an average Joe investor with a higher-than-average conviction on a specific business has a platform to actualize that sentiment. By opening its doors to a broader, net-savvy audience, both private-equity issuing companies and speculators win.
Of course, as with any monetary opportunity, risks abound. For startup investments, prospective buyers must exercise due diligence. And I would argue they must do so with greater diligence than when approaching blue-chip stocks. Due to the “newness” factor, there may not be much information available. Further, you are typically gambling more on a narrative than an established track record.
But that’s the allure and the risk behind investing in startups. If this concept tickles your bones, check out these three opportunities on Netcapital:
- Dome Audio
- Infinovate LLC
- Watch Party
Invest in Startups on Netcapital: Dome Audio
Total Raised: $50,642
When I first heard about Dome Audio, it really caught my attention. Specializing in bone conduction headphones, these nifty devices are just like their standard counterpart, except for one obvious difference: they lack the often bulging cover of closed-ear headphones.
With Dome Audio’s alternative, we’re talking about an open-ear headphone. In traditional headphones or in-ear sets, soundwaves vibrate the ear drums, which in turn sends signals to the cochlea. With bone conduction technology, the soundwaves skip the ear drums and go straight for the cochlea.
Mainly, this innovation has two benefits. First, open-ear headphones are significantly safer than traditional sets. You can hear your environment because you don’t have a seal covering your ears. Second, Dome Audio is healthier for you. Long exposure to headphones and especially earphones, even at moderate volume, can damage your hearing over time.
Still, Dome Audio products aren’t without setbacks. Because these platforms don’t vibrate the ear drum, you lose sound quality. I’m not sure if there is a workaround to this scientific problem. However, you should try Dome Audio before buying its stock. Also, the company faces competition in a crowded and competitive sector.
However, this arena is begging for a player to establish dominance and that could be Dome Audio. To invest, shares are listed at 32 cents ($99.20 minimum investment) with an Aug. 31, 2020 deadline.
Total Raised: $15,010
Personally, I found Infinovate LLC as one of the more intriguing startup investments because it aligns with my interest: building investment analytics platforms that are intuitive, informative and comprehensive. All analysts and investors have access to price charts and financial data. However, incorporating this data into a single, cohesive unit, particularly for mutual funds is a daunting task.
Typically, small-time investors and independent analysts must rely on their own handiwork. And that means hours and hours of plugging data into spreadsheets, while attempting to extract useful information from that data. For professional financial advisors, those are hours that could be better spent guiding clients to success.
As Infinovate states on its Netcapital profile, “It takes an average of 8 hours to build a financial model from scratch in an excel spreadsheet.” With Infinovate, its platform consolidates data from 30,000 mutual funds into a clean, user-friendly format. As well, it provides predictive modeling to help guide better decisions.
Though a much-needed time saver, there are some risks to consider. First, the obvious: predictive modeling doesn’t necessarily mean that those predictions will be accurate. Second, Infinovate is vulnerable to increased competition. As well, the broader investing platform business is a crowded one, making it difficult to establish brand dominance.
Nevertheless, those who are serious about investing should consider Infinovate. Shares are priced at $10 a pop with a $100 minimum investment. Also, the deadline is Aug. 31, 2020.
Total Raised: $34,362
It’s the irony of the information age. Despite the seemingly endless number of entertainment options on TV thanks to streaming platforms, we can’t find something good to watch. According to Digitalsmiths, “Almost 2 in 3 adults feel frustrated either sometimes (54.1%) or always (11.8%) when trying to find something to watch on TV.”
This leads me to one of the quirkiest startup investments on Netcapital, Watch Party. As the company’s profile states, recommendations offered by a particular will have a vested interest in their recommendations. For instance, Netflix (NASDAQ:NFLX) will advertise Netflix shows. It’s the same for content under the Amazon (NASDAQ:AMZN) umbrella.
Thankfully, Watch Party breaks up this content cronyism by broadening the recommendation scope without regard to material interest. Further, the app allows you to see what your family and friends are watching. As well, you can make new friends through a shared passion of your favorite shows.
It sounds like a great concept, especially in this quarantined environment. However, the biggest risk factor (in my opinion) is that Watch Party could be rendered a gimmick. There’s no compelling reason why you need an app to find something you like – just look it up yourself.
Still, we live in a social media ecosystem. If you’re interested in Watch Party, shares are $2.14 a pop with a $2.14 minimum investment. The deadline is Sept. 30, 2020.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. As of this writing, he did not hold a position in any of the aforementioned securities.