Investor Profile: MicroVentures - Thesis, Cheque Size & How to Apply

MicroVentures is one of the oldest startup investing platforms in the United States. Founded in 2009, it operates as a FINRA-registered broker-dealer, a status that sets it apart from pure funding portals, because it can sell shares directly rather than routing every deal through a third-party intermediary. For founders asking how to get funding from MicroVentures, the route is a curated primary offering to its investor network, with the platform negotiating terms and publishing its own due diligence for investors to review.

The thesis is venture capital with open access. MicroVentures takes the deal flow, research and screening of traditional venture investing and combines it with the reach of equity crowdfunding. It funds startups across technology, consumer products and services, healthcare, media and entertainment, and telecommunications, and it is deliberately selective: it reports accepting less than 0.5% of companies that apply for listing, and publishes the results of its due diligence on each listed company.

Thesis, sectors and investment terms

There is no single MicroVentures fund size publicly disclosed, because the platform raises deal by deal rather than from a pooled fund. Historically, the average company listed on MicroVentures raised around $250,000, with outliers raising over $1 million, and reported platform fees on successful raises were 10% in total plus 10% carry, though founders should confirm current fees directly, as historic reporting may not reflect today's terms. Investment minimums vary by offering: Regulation Crowdfunding deals can start at around $100, while accredited-only deals typically start higher, and the platform reports more than 60,000 accredited investors on its network.

MicroVentures offers three main deal types. Primary offerings under Regulation Crowdfunding let companies raise up to $5 million from accredited and non-accredited investors alike. Regulation D 506(b) primary offerings generally back seed or Series A rounds at companies already generating significant revenue and growth, and are open to accredited investors only. Regulation D 506(b) secondary offerings typically invest $1 million to $5 million in late-stage, pre-IPO companies. The platform also runs a secondary marketplace where accredited investors can trade shares of previously listed companies, although liquidity there is thin.

Notable portfolio and partners

MicroVentures completed its first three company fundings in April 2011, raising $150,000 in total. Its first project, Republic Project, a cloud platform for managing digital media campaigns, sold to Digital Generation in October 2013 for $14.5 million, the first liquidity event for investors in an equity crowdfunded company. Later secondary offerings gave investors access to household names before they went public, including Facebook, Twitter, Yelp, Slack, Lyft and Uber, although those were secondary share sales, not primary funding rounds for those companies.

How to apply for funding

Founders begin by creating a company profile on microventures.com, setting out the business, the amount sought and the investment terms, and then go through the platform's due diligence process. Reported eligibility criteria for primary raises include being incorporated in the United States, having a working product or service, and having at least two full-time employees, with early customer feedback expected for Regulation Crowdfunding raises. If selected, the company works with MicroVentures on its listing and disclosures, and if the offering does not reach its full target, investor money is returned.