StartEngine ‘Going on Offense’ – Announces Acquisition of SeedInvest from Circle

StartEngine has managed to weather the current market downturn better than most, boasting consistent growth that has allowed it to surpass over 1 million users.  The company indicates that it is now, “going on offense”, announcing that it will be acquiring rival platform SeedInvest.

Details of the Deal

Currently owned by Circle, SeedInvest has long been noted as a promising equity crowdfunding platform to support digital securities.  Meanwhile, rival StartEngine has also be establishing its own positive reputation, notably aligning itself with celebrity investor Kevin O'Leary in recent years.

While the finer details surrounding this deal are scant so far, StartEngine has shared that this acquisition will not see Circle sell off the entirety of its stake in SeedInvest.  Rather, Circle is expected to remain a minority owner in the platform moving forward.

With Circle remaining a minority owner of SeedInvest, StartEngine CEO Howard Marks highlighted an ancillary perk.

“The agreement is a boon for StartEngine’s cap table as well. Why? Well, under the terms of the offer, SeedInvest’s current parent company and one of the largest crypto platforms in the world, Circle, will become a minority shareholder of StartEngine. And as any founder will tell you, having the right backers can make all the difference.”

Beyond helping its cap table, Marks noted the following two point as major benefits coming from this deal.

• increased investment opportunities listed on StartEngine
• increased investor community

Essentially, a greater amount of people will have access to a greater amount of opportunities.  It should be noted that this deal has yet to be finalized, and will remain pending until approval is granted by FINRA.

Commentary

Upon announcing this deal, StartEngine CEO Howard Marks acknowledged the role SeedInvest has played in establishing the equity crowdfunding sector.  He elaborates upon this, along with highlighting some past accomplishments of the company, as StartEngine gears up to continue this ‘legacy'.

“SeedInvest is a genuine pioneer in equity crowdfunding. SeedInvest’s founder and CEO Ryan Feit was one of the signatories on the petition that kicked off online raises. They were also the first platform to apply the JOBS Act to Regulation D offerings – way ahead of the advent of Regulation A+ or even StartEngine itself.

Nowadays, they have an impressive roster of more than 250 successful funding rounds under their belt, many of which have topped 8 figures. Case in point: NowRX has fundraised over $40 million on SeedInvest to date. The platform’s investor base is among the best in the industry too. They have an investor community of over 700,000 users, who’ve collectively raised over $470 million in SeedInvest’s 10-year run.

Now, we’re preparing to inherit SeedInvest’s trailblazing legacy as we consolidate their community with our own.”

Past Rumblings

Notably, this is not the first time that there have been rumblings of Circle selling off SeedInvest.  Multiple years ago, Circle made the decision to pivot most of its attention towards Stablecoins, and its offering of USDC.  Before this however, Circle appeared set to acquire key players from various niches within the digital asset sector, building out a comprehensive portfolio.  Another example of this from this time was the acquisition and subsequent sale of Poloniex – an exchange near the peak of its popularity when acquired.

While it took a few years, Circle now appears successful in its attempt to offload a promising company that no longer aligns with its own vision.  Hopefully now, SeedInvest will grow into something larger alongside StartEngine, allowing for Circle to continue concentrating on the adoption of USDC at the same time.