To facilitate more local investment in the Western New York food system, we are publicizing offerings made by local food and farming businesses. We encourage interested residents in the region to consider investing in these businesses, and interested companies to consider raising capital through these tools. Below we explain briefly each tool.
Bulk Pre-Purchasing Deals – Through the website Credibles, you can find businesses that are “preselling” in bulk goods and services. Presales enable established businesses to get more cash on hand that can then be used for modest investment purposes. Participating businesses usually offer discounts to customers who do bulk pre-purchasing. Such deals are rarely considered “securities offerings” and therefore are relatively inexpensive and easy ways to raise capital. If you’re a business interested in learning more about pre-purchasing, Credibles provides a good explanation here.
Investment Crowdfunding – Thanks for the JOBS Act of 2012, investment crowdfunding is now legal. Any qualifying company can raise up to $5 million in a given year, and any investor can put up to $2,200 per year into such companies (more if you each more than $107,000 per year). Participating businesses can structure their deals as debt, stock, convertible notes, royalty agreements, and many other types of arrangements. The average successful company raised about $300,000 now. All deals must be transacted on a federally licensed portal (there are almost 100 today). If you’re interested in learning more about this option, whether as a business or an investor, check out our primer here.
Donation Crowdfunding – Any person can donate any amount to any business it wishes. Often these donation deals are structured with perks, where investors get a T-shirt, samples, or some other token gift. Because donations are not considered “securities,” they are not regulated like investments. There are literally hundreds of web sites promoting donation crowdfunding, though the most common are GoFundMe and Kickstarter. If you run a food and farming business in the region and have a donation crowdfunding offering, please let us know and we will publicize it on the home page.
Bulk Pre-Purchasing Deals – Through the website Credibles, you can find businesses that are “preselling” in bulk goods and services. Presales enable established businesses to get more cash on hand that can then be used for modest investment purposes. Participating businesses usually offer discounts to customers who do bulk pre-purchasing. Such deals are rarely considered “securities offerings” and therefore are relatively inexpensive and easy ways to raise capital. If you’re a business interested in learning more about pre-purchasing, Credibles provides a good explanation here.
Investment Crowdfunding – Thanks for the JOBS Act of 2012, investment crowdfunding is now legal. Any qualifying company can raise up to $5 million in a given year, and any investor can put up to $2,200 per year into such companies (more if you each more than $107,000 per year). Participating businesses can structure their deals as debt, stock, convertible notes, royalty agreements, and many other types of arrangements. The average successful company raised about $300,000 now. All deals must be transacted on a federally licensed portal (there are almost 100 today). If you’re interested in learning more about this option, whether as a business or an investor, check out our primer here.
Donation Crowdfunding – Any person can donate any amount to any business it wishes. Often these donation deals are structured with perks, where investors get a T-shirt, samples, or some other token gift. Because donations are not considered “securities,” they are not regulated like investments. There are literally hundreds of web sites promoting donation crowdfunding, though the most common are GoFundMe and Kickstarter. If you run a food and farming business in the region and have a donation crowdfunding offering, please let us know and we will publicize it on the home page.