Editor’s note: This article was updated on Sept. 10, 2020, to highlight three new startups to invest in on StartEngine.
Television ads are running these days where Mr. Wonderful, otherwise known as Kevin O’Leary of Shark Tank fame, tells viewers that if you’re considering startups to invest in, StartEngine is the place to go.
He’s not wrong. It’s one of the best equity crowdfunding portals in the country. In the four years since its founding, StartEngine has become one of the country’s leading equity crowdfunding platforms, raising more than $200 million from more than 275,000 investors to help more than 375 companies grow.
Well, it looks like it’s about to get even better for equity crowdfunding platforms such as StartEngine. That’s because the Securities and Exchange Commission has upgraded the “accredited investor” definition to broaden the qualifications while also making it easier for more people to access private investments.
I won’t get into all the nuts and bolts of the changes. Suffice to say it ought to be very good for StartEngine, current investors in StartEngine equity crowdfunding campaigns, and future investors who get involved in private investing due to these changes.
- Ola Brew
Currently, it has 96 investment opportunities on its platform. But these three, I believe, are some of the best startups to invest in here.
StartEngine Startups to Invest In: Ola Brew
When it comes to equity crowdfunding, I’m a sucker for food and beverage campaigns. It’s so much easier to get behind something local at heart, but anyone from anywhere can understand the basics behind the business model. In other words, you don’t have to live in Hawaii or even have a desire to go to Hawaii to consider investing in Ola Brew.
So, what is Ola Brew?
It’s a maker of beers, hard ciders, and hard seltzers. Located on the Big Island of Kailua-Kona in Hawaii, it got its start in December 2017, at a 14,000-square-foot brewing facility with a production capacity of 22,000 barrels per year. That has since increased to 40,000.
Due to the growth in the hard seltzer market, Ola Brew is focusing most of its attention in this area. In 2019, the company had $3.5 million in net revenue. The hard seltzers were launched in September 2019. In four months, it sold over $550,000 in hard seltzer products.
That’s why it’s pushing onto the mainland. In June, it launched its Ola Hard Seltzers in Amazon’s (NASDAQ:AMZN) Whole Foods.
In Ola Brew’s latest campaign, Ola Brew has raised $513,000 from 464 investors. That’s an average of $1,105 per investor despite a $225 minimum. Based on the current raise, the company’s got a valuation of $19.5 million.
If it succeeds in California, that number will seem far too small down the road.
If nothing else, the people behind this Miramar, Florida, company have designed a cool logo. It’s awesome.
I have to admit that I’m not much of a boater. Well, if you count my Sperry Topsider deck shoes, that’s a whole different kettle of fish. But these guys look deadly serious about changing the outboard engine market for the better.
Chief Executive Officer Alberto Araujo and Chief Operating Officer Omar Jimenez have created a proprietary inline four-cylinder outboard engine that delivers 50% more horsepower with half the weight.
Have you ever driven a fast go-cart? One of the reasons it’s so fast is it weighs next to nothing. Put a decent amount of power on that, and you’re going to go like stink. It’s simple physics.
Now, the worldwide market for marine outboard engines is expected to be $17 billion by 2025.
I like to say that the best startups to invest in are those that either make or save you time and money. The Alfadan improves a boater’s fuel economy by 15% while reducing the maintenance costs by 50%. Boating isn’t the cheapest of leisure activities, so every little bit helps.
To date, Alfadan has raised $758,000 of its $1.07 million maximum offering allowed under equity crowdfunding regulations. At a minimum investment of $250, the average investment is $613 per investor.
Perhaps the most exciting aspect of the Alfadan is that it is outsourcing almost all of the manufacturing processes to others, with the final assembly at its yet to be determined facility.
It’s going to be tough. Evinrude recently decided to exit the outboard engine market. But if you’re a boater and can afford to lose your investment, Alfadan looks intriguing.
If you want to get in on Tapville, you better decide in a hurry. Its campaign ends on Sep. 28. To date, it has raised $276,000 (average of $521 per investor) selling common shares at $1 per share and a minimum of 200 shares.
Tapville provides bars and restaurants with the self-service technology and advanced data analytics necessary for locations to generate significant revenue from its self-pour technology.
To date, Tapville’s technology’s been used by two affiliate locations owned by the company’s CEO, Joseph Tota. Since 2016, the two locations have generated more than $5 million in revenue utilizing the technology.
In addition to the technology, Tapville has developed brick-and-mortar, kiosk, and mobile kiosk prototypes that franchisees buy and operate.
Years ago, I can remember having some drinks on the streets of the French Quarter in New Orleans. This seems like a more advanced version.
Franchising is a cutthroat business. It won’t be easy growing from two locations to the hundreds necessary for economies of scale. But I do like the concept.
On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities.
Investing through equity and real estate crowdfunding or asset tokenization requires a high degree of risk tolerance. Despite what individual companies may promise, there’s always the chance of losing a portion, or the entirety, of your investment. These risks include:
1) Greater chance of failure
2) Risk of fraudulent activity
3) Lack of liquidity
4) Economic downturns
5) Dearth of investor education
Read more: Private Investing Risks