- 140+ partner brands (including Patagonia, Warby Parker) paying to promote their products through DoneGood
- Tripled user community since the start of 2018 to over 100,000 users
- 6X increase in sales to partner brands from Q2 2017 to Q2 2018
- Strategic partnerships with major organizations like 1% for the Planet
- Founded "Shop for Good Sunday," ethical alternative to Black Friday/Cyber Monday, a coordinated marketing campaign w/ 50 brands and prominent non-profit organizations
- Total Amount Raised: US $474,822
- Total Round Size: US $1,100,000
- Seed :
- Minimum Investment: US $500 per investor
- : Tiered Preferred Equity
- US $4,750,000 :
- Side by Side Offering
- Purchase Price: US $0.3720 before Sep 22, 2018
- Pricing Discount: 4.4% discount before Sep 22, 2018
- Pricing Schedule: See Full Schedule
There’s been a fundamental shift in our economy. More and more people want to know that the money they spend supports things they believe in. Demand for ethically-sourced, fair trade, sustainable goods is growing rapidly.
But it can be really hard for this growing group of consumers to find what they need, when they need it, from a brand they know is doing good for people and the planet.
DoneGood is the online shopping platform that makes it quick, easy and affordable for these consumers to find the ethical and sustainable products they want—and know they can feel good about every purchase.
Two ways to use DoneGood to find products that make the world better:
1. DoneGood Laptop Plugin: Download the free plugin instantly on your laptop—then just shop online like you normally would. When you search for products on Amazon or Google, or go to a big-name retailer’s website, the plugin automatically shows socially and environmentally responsible brands that have the kind of product you're looking for, right along the side of your screen.
2. The DoneGood shopping website: Easily find thousands of products from hundreds of mission-driven brands all in one place. Quickly find anything from a ski hat that reduces poverty to a toothbrush that fights climate change. Forbes called it the “the Amazon of social good.”
DoneGood users also get access to exclusive discounts on products from DoneGood’s partner brands.
So you can get higher quality products, save money, and make the world better—just by getting something you needed to buy anyway!
Over 140 paying partner brands that do good for people and the planet on the DoneGood platform.
- Includes big names like Patagonia and Warby Parker.
- Brands contact us every week asking to become a paying DoneGood partner.
- Brands report that DoneGood users convert to buyers at higher rates than their normal web visitors.
Nearly tripled user community across the DoneGood platform from January to June 30, 2018 to over 100,000
Cross-promotional partnerships with major organizations like 1% for the Planet, Rain Forest Alliance, B Lab, Free the Slaves.
Founded "Shop for Good Sunday," the alternative to Black Friday and Cyber Monday. A day to shop with social impact brands and use your holiday spending to make a positive impact in people's lives.
- DoneGood led this coordinated marketing campaign with over 50 companies and major non-profits.
- Resulted in 270 million organic online impressions.
Featured in major news outlets like the Washington Post, Forbes, CNBC, WIRED, Mashable, Fast Company, many more.
Incubated at Harvard’s Innovation Lab
Won cash awards at Harvard and MIT startup competitions
We’re proud of all those accomplishments—but we’re most proud of the impact our users and partner brands are making!
DoneGood users have made hundreds of thousands of dollars in purchases from brands committed to doing good for people and the planet. Each of those purchases helps to prove that businesses can be successful and do the right thing at the same time.
We started DoneGood because we believe that the dollars we all spend can be the world's most powerful force for change. Americans gave $390 billion to charity last year—but we spent spent $130 Trillion buying stuff. If even a fraction of that spending can also help reduce poverty, fight climate change, and otherwise do good for people and the planet, the impact is huge!
DoneGood is a Certified B Corporation and is a 2018 B Corp “Best for the World’” awardee.
Users of the DoneGood browser plugin and shopping site easily discover thousands of products from brands that are all doing good for people and the planet (paying workers a living wage, highly eco-friendly practices, free of child and trafficked labor, etc).
DoneGood earns a commission (usually 10%, as high as 20%) on products purchased through our platform.
Some brands also choose to pay an additional flat fee for featured placement in DoneGood's email newsletter and website.
Potential future revenue streams include:
- Licensing the DoneGood-approved seal for use on other retailer websites
- Allowing other sites to use commission-generating DoneGood links to our partner brands, and sharing revenue generated with host site (piloted)
- Fulfilling bulk purchases for non-profit organizations and businesses seeking sustainably-made goods (piloted)
- Monetizing aggregate data reports on the shopping preferences of conscious consumers
- Charging B2B companies to make offers to our set of partner brands (we consistently receive requests for this).
A Highly Engaged Community
DoneGood has built a highly loyal and engaged community of users and partner brands.
That loyalty is demonstrated by the high monthly engagement of the DoneGood browser plugin and the fact that our e-newsletter has a clickthrough rate three times higher than the industry average.
It's also demonstrated by our users and brand partners telling us!
Partner brand love:
- “DoneGood users buy at around five times the rate of our average site visitors. You’ve built a very valuable mission-aligned community. Since you first reached out, I’ve been on board with your mission and messaging—love it. DoneGood is our kind of partner!”
-Ted Barber, cofounder of Prosperity Candle, a fair trade candle company empowering women refugees with living wage jobs
- “You guys are the coolest. You’re growing to be real leaders in the movement! :)”
-Katie Martinez, Founder of Elegantees, a women’s fashion brand providig sustainable employment to women overcoming sex trafficking
“Before you existed, my thought process was: 'Ethical businesses are too hard to find so I’ll just swing by Walmart...' Thanks for existing so that I don’t have an existential crisis every time I buy something!”
“LOVE this! I've discovered small companies with great merchandise and ethical practices I wouldn't have found on my own.”
“The discounts are icing on the guilt-free cake.”
“You inspire us... You make it easy for each of us to make a small difference that adds up to a dramatic impact. Here's to many more years of doing good together."
*Disclaimer: The above individuals were not compensated in exchange for their testimonials. In addition, their testimonials should not be construed as and/or considered investment advice.
DoneGood previously raised a $700,000+ pre-seed round to achieve these goals:
- Launch nationally (achieved November 2016)
Launch online shop (achieved November 2017)
- Secure 100 paying partner brands (achieved April 2018)
- Reach estimated LTV ($3.60) that exceeds cost-to-acquire ($1.60, through paid marketing) (achieved May 2018)
Build a community of 100,000 users across the platform (achieved June 2018)
DoneGood has demonstrated product market fit, a loyal base of users and brands, partnerships w/ major brands and organizations, and is now the established leader in our space.
Now it’s time to go to the next level!
If you join the team as an investor in DoneGood, we can:
1. Grow the user base
- DoneGood has partnered with major NGOs (like 1% for the Planet and Free the Slaves) to create co-branded shops on the DoneGood website. These organizations agree to promote these shops to their audiences on an ongoing basis.
- When partner brands are added to the DoneGood platform, they announce to their (conscious) customer base that they have been selected to join the DoneGood community.
- These partnerships provide DoneGood free exposure to mission-aligned audiences.
Free growth fundamentals
- DoneGood has grown through widespread media coverage, influencer relations and word of mouth.
- With additional resources DoneGood can scale influencer relations, enhance SEO, and create an in-platform rewards program that incentivizes DoneGood users to share DoneGood with friends.
- DoneGood has demonstrated a low cost-to-acquire users (~$1.60) through online ads and paid campaigns with strategic partners.
- Our average cross-platform lifetime value of a user (LTV) is an estimated $3.60.
2. Grow revenue/LTV
Phase out freemium model:
- To get started, DoneGood did not initially charge brands to promote their products on our platform.
- 140 brands are now paying, but the majority of brands on the DoneGood platform are not yet paying.
- At current rate of growth, DoneGood will have over 300 partner brands on the platform with 100% of those brands paying for DoneGood’s services in 2019. This will substantially increase revenue.
Grow tech team; increase LTV/purchases per user with:
- Personalized product recommendations
- Automated upsells, cross-sells, retargeting (e.g., “abandoned cart” reminders)
- Loyalty program to reward repeat buyers
- Allowing users to track the social and environmental impact of the purchases they’ve made
- Product improvements to reduce friction/fewer clicks-to-purchase, other user experience improvements
Examples of brands featured on the DoneGood platform:
Starfish Project: A jewelry company that helps women escape sex trafficking in Asia by giving women jobs making jewelry, then providing them skills training to move to professional careers. Purchases also fund non-profit work that helps thousands more women.
Norton Point: Creates cool shades from 100% recovered ocean plastic. Every pair of sunglasses removes one pound of plastic from the ocean and funds other global cleanup efforts.
Krochet Kids: Three guys taught themselves to crochet so they could make their own ski hats. Then they volunteered in a refugee camp and taught people to crochet there. Now they’re employing 130 people in Uganda and Peru at 10x the average wages of the region.
Looptworks: Making lifetime-guaranteed bags out of Southwest airplane seat covers and other upcycled materials, keeping tons of high-quality material out of landfills, workers earn fair wages.
Mpowerd: Makers of cool inflatable lights for camping or decorations that are run on solar power. Purchases help provide light to the 1.5 billion people still living without access to electricity around the world.
Sseko: A stylish women’s fashion brand; women in Uganda spend two years working with Sseko earning good wages and the company then provides a scholarship so they can attend college.
Cullen, DoneGood's founder, moved to Washington, D.C. in 2007 to pursue a career in politics. He served as a senior communications advisor to members of Congress and in the Obama Administration so he could have a job where he fought for greater social and environmental justice every day.
But he realized his own consumer spending was too often working against him, supporting global systems that lock people in poverty and exploit the natural world. He wanted to know the money he spent supported things he believed in.
Yet finding businesses that he knew were doing good for workers and the environment was way too hard. It frustrated him. He talked to others and found he wasn't alone!
So he built a team of talented, mission-driven (and funny) professionals and started DoneGood.
Our team believes that the most important ideological shift of this century will be the movement away from the ideology that says a business’s only purpose should be to maximize profit at all costs. Consumer demand is what will accelerate that shift most rapidly. In a supply and demand economy, the more we demand products made in a way that makes a positive impact in peoples' lives, the more the market supplies them--and the better the world gets.
We believe consumer spending can be the world’s greatest force for change.
A good user experience must come first. We must make using DoneGood as easy and as quick as possible. Limited time to shop is the number one barrier to consumers buying ethically/buying from social impact brands like those DoneGood features. We must constantly reduce friction, reducing the number of clicks and amount of time it takes for users to find a product they love. This is our highest priority.
Partner brands are our paying customers. We must work to make them more successful by converting sales for them. The more we provide users a great experience, the more sales we'll make for partner brands.
The number one KPI for both our social impact and our business success is “dollars diverted”—consumer spending redirected from (usually far less ethical and sustainable companies) to brands on a mission to empower workers, protect the environment, and otherwise make the world better.
We are strong adherents to the principles of Conscious Capitalism. Our central focus must always be to make our product a true gift to the world and to create real value for all stakeholders, especially our users and partner brands.
Major expenditures are team salaries/benefits/payroll taxes, web hosting and IT costs, and paid marketing. Currently monthly burn rate is approximately $30k, not including paid marketing investments. Paid marketing investment fluctuates based on strategic decisions, while other expenses remain very consistent, although web hosting costs increase as user base grows. More details can be found in our financials.
Others attempting to help conscious consumers such as Good Guide, Buycott, and BuyPartisan require scanning product bar codes with a smartphone in-store. DoneGood helps make shopping for ethical and sustainable products easier and quicker. Barcode scanning increases the amount of time it takes to shop—exacerbating, not solving, target consumers’ number one problem. DoneGood works online; these are offline solutions that only work in brick and mortar locations.
There are various websites and shopping apps providing relatively limited selections of ethically-sourced and sustainably-made products. These platforms require people to change their behavior, to stop shopping on Amazon/Google/big-name brand websites, and come to their platforms instead. On the other hand, DoneGood allows users to continue current behavior, working effortlessly in the background no matter how users choose to shop. This means those who install the DoneGood browser plugin automatically use DoneGood every time they shop.
Our model also allows us to turn any of these shopping sites into customers instead of competitors. We have people tell us about retail sites selling ethical and sustainable products as though they’re competitors—we call them and sign them up to be on the DoneGood platform, adding to DoneGood’s product set and increasing our number of paying partner brands. Our model makes us uniquely positioned to roll up the entire social impact space and become the go-to one-stop shop for this growing market.
We would talk about how the money we spent was probably working against the causes we were working toward. It’s so hard to know what businesses are doing and what your money is supporting.
Way back when I was an undergrad, around the turn of the century (1999 – 2003), I wrote a paper about how conscious consumerism would be the new movement for change of the 21st Century. Now the market is starting to bear that out more and more.
So I talked with Scott about starting a company like DoneGood. We applied with the idea to the Harvard Innovation Lab and were accepted to the program. We worked together piloting different models while in the iLab program, to our national launch about a year and a half ago, and growing the company since.
Recently Scott and I mutually decided the time was right for him to pursue other opportunities, and Scott left the company at the beginning of July. Scott, Howard Fischer (the investor representative on DoneGood’s Board of Directors), and the others on DoneGood’s advisory board all believe this change leaves the company in a stronger position. While our pre-seed phase was about building up a loyal community of users and partner brands and becoming the established leader in our space, the next phase is about becoming a more sophisticated e-commerce platform that drives sales and revenue growth. To do that, DoneGood needs to grow its tech team and add team members highly experienced in e-commerce. The company now has a greater ability to do that.
A Side by Side offering refers to a deal that is raising capital under two offering types. If you plan on investing less than US $20,000.00, you will automatically invest under the Regulation CF offering type. If you invest more than US $20,000.00, you must be an accredited investor and invest under the Regulation D offering type.
US $154,822 (under Reg CF only)
US $0.3720 before Sep 22, 2018 (4.4% discount)
US $0.3890 Final
All non-Major Purchasers will be subject to an Investment Proxy Agreement "IPA". The IPA will authorize SeedInvest to act as representative for each non-Major Purchaser and take certain actions for their benefit and on their behalf. Please see a copy of the IPA included with the Company's offering materials for additional details.
First 100 people investing $750 or more:
• Free DoneGood t-shirt
(ethically and sustainably made of course)
• "Look ma, I DoneGood!” stickers
(produced in a local worker-owned co-op with sustainable inks)
Investing $5,000 or more:
• One-on-one strategy and feedback call with a member of DoneGood's leadership team
• $100 gift card to a select DoneGood-approved brand of your choice
• DoneGood t-shirt and stickers
• One-on-one strategy and feedback call with DoneGood's CEO
• Featured as a “Movement Builder” in DoneGood’s email newsletter and website (if desired)
• $200 gift card to a select DoneGood-approved brand of your choice
• Two DoneGood t-shirts and stickers
• Join a DoneGood team Friday happy hour via video call to get to know the whole DoneGood team and talk strategy
(we'll have drinks and snacks sent to your place)
• Featured as a “Movement Leader” in DoneGood’s email newsletter and website (if desired)
• $400 DoneGood shopping spree (we’ll provide $400 in gift card(s) to select DoneGood-partner brands you choose)
• Family pack of DoneGood t-shirts and stickers
• Invited to the quarterly outlook and planning conference call with the DoneGood team and other investors/advisors
• Join a weekly DoneGood team Friday happy hour via video call to get to know the whole DoneGood team and talk strategy
(we'll have drinks and snacks sent to your place)
• A Q&A interview on the DoneGood blog about why you believe in the DoneGood movement (if desired)
• Featured as a “Movement Visionary” in DoneGood’s email newsletter and website (if desired)
• $800 DoneGood shopping spree
• Family pack of DoneGood t-shirts and stickers
All of the perks at the $50,000 level, plus:
"The DoneGood DoneFun Reality Tour" with the DoneGood team in Boston!
• Airfare for two from anywhere in the contiguous United States to Boston
• Three nights lodging at The Lenox Hotel
(An historic, luxury property in Boston run by the Saunders Hotel Group, sustainability pioneers in the hotel industry. Some of The Lenox owners are also DoneGood investors.)
• Dinner with the DoneGood team
• Whale-watching excursion with the DoneGood team
• Tour of nearby DoneGood partner brand production facility, Prosperity Candle
(makers of high-quality, non-toxic hand-poured candles, creating sustainable employment opportunities for its women refugee workforce)
• Tour of the Harvard Innovation Lab
(Harvard University’s startup incubator where DoneGood got its start)
• As time and your schedule may permit: other Boston/Cambridge area sightseeing, and/or day trip to Walden Pond with the DoneGood team
It is advised that you consult a tax professional to fully understand any potential tax implications of receiving investor perks before making an investment.
The graph below illustrates theor the of DoneGood's prior rounds by year.
DoneGood, PBC (“the Company”) provides an online browser plugin, app and website to assist shoppers in buying products from socially responsible companies. The Company was formed in August of 2014 and was originally setup as a Limited Liability Company. On February 29, 2016, DoneGood became incorporated in the State of Delaware as a Public Benefit Corporation. Headquarters for operations currently resides in Quincy, Massachusetts.
Liquidity and Capital Resources
The proceeds from the Offering are essential to our operations. We plan to use the proceeds as set forth above under "Use of Proceeds", which is an indispensable element of our business strategy. The Offering proceeds will have a beneficial effect on our liquidity, as we have approximately $143,034 in cash on hand as of April 30, 2018 which will be augmented by the Offering proceeds and used to execute our business strategy.
The Company currently does not have any additional outside sources of capital other than the proceeds from the Combined Offerings.
Capital Expenditures and Other Obligations
The Company does not intend to make any material capital expenditures in the future.
The LOHAS consumer segment (those seeking a “Lifestyle of Health and Sustainability” and making social and environmental impact a factor in their purchasing decisions) represents a $300 billion market opportunity. Online sales of sustainable consumer goods in the U.S. alone have risen to $27.5 billion annually.
This market is growing so rapidly due to a fundamental shift in consumer behavior.
A Nielsen report, The Sustainability Imperative, shows 66 percent of consumers are now willing to pay more for sustainably-made goods, with this number rising each year. Nielsen concludes:
“Commitment to social and environmental responsibility is surpassing some of the more traditional influences for many consumers. Brands that fail to take this into account will likely fall behind.”
A 2016 Natural Marketing Institute report agrees, saying: “Sustainability is not a trend, it is becoming a cultural shift.”
From the report How Millennials are Changing the Face of Marketing Forever from the Boston Consulting Group:
“Millennials are also leading indicators of the new ‘status currency’—the status and values that consumers wish to project through their purchasing decisions and their brand affiliations. One way a company can connect with this new status currency is by convincing millennials that they are “doing good” when they purchase its brands. Companies need to demonstrate... they help those in need, are socially responsible, are good environmental stewards, protect personal data, or are transparent and sincere.”
Increased demand has led to an explosion in the number of ethical and sustainable brands. In fact, the number of Certified B Corps (brands independently certified for exceptional social and environmental impact) doubled over just a two-year period (from 0 – 1,000 B Corps from 2006 to 2014, then to over 2,000 B Corps by 2016).
Major corporations are recognizing the trend. In 2011, less than 20% of S&P 500 companies filed Corporate Social Responsibility reports outlining their social and environmental impact; more than 80% were filing CSR reports by 2017.
All of this demonstrates a tremendous change in our economy.
The number of consumers making purchasing decisions based on products social impact is large and growing rapidly.
DoneGood is the only platform positioned to be the one-stop shop serving this growing market.
The reviewing CPA has included a “going concern” note in the reviewed financials. The Company has incurred losses from inception of approximately $476,874 which, among other factors, raises substantial doubt about the Company's ability to continue as a going concern for the twelve-month period from the report date. The ability of the Company to continue as a going concern is dependent upon management's plans to raise additional capital from the issuance of debt or the sale of stock, its ability to attract users to its software platform and its ability to generate positive operational cash flow. The accompanying financial statements do not include any adjustments that might be required should the Company be unable to continue as a going concern.
Maintaining, extending and expanding our reputation and brand image are essential to our business success. We seek to maintain, extend, and expand our brand image through marketing, including advertising and consumer promotions, and product innovation and third party partnerships. Increasing attention on marketing could adversely affect our brand image. Existing or increased legal or regulatory restrictions on our advertising, consumer promotions and marketing, or our response to those restrictions, could limit our efforts to maintain, extend and expand our brands. Moreover, adverse publicity about our partners could damage our reputation and brand image, undermine our customers’ confidence and reduce long-term demand for our products. In addition, our success in maintaining, extending, and expanding our brand image depends on our ability to adapt to a rapidly changing media environment. We increasingly rely on social media and online dissemination of advertising campaigns. Negative posts or comments about us, our brands or our products on social or digital media, whether or not valid, could seriously damage our brands and reputation.
The amount of capital the Company is attempting to raise in this Offering is not enough to sustain the Company’s current business plan, as it has post raise cash burn of over $50,000 and will not be profitable for the foreseeable future. In order to achieve the Company’s near and long-term goals, the Company will need to procure funds in addition to the amount raised in the Offering. There is no guarantee the Company will be able to raise such funds on acceptable terms or at all. If we are not able to raise sufficient capital in the future, we will not be able to execute our business plan, our continued operations will be in jeopardy and we may be forced to cease operations and sell or otherwise transfer all or substantially all of our remaining assets, which could cause a Purchaser to lose all or a portion of his or her investment.
Scott Jacobsen, a co-founder, has recently left the Company. He has a vested equity ownership of roughly 25.5% of the company as of July, 2018 and will control a significant portion of the equity stack / voting rights while having no formal ties to the company in any way.
Existing investors have not waived their pre-emptive rights and currently plan on exercising those rights. The pre-emptive right entitles those investors to participate in this securities issuance on a pro rata basis. If those investors choose to exercise their pre-emptive right, it could dilute shareholders in this round. This dilution could reduce the economic value of the investment, the relative ownership resulting from the investment, or both.
Through our operations, we collect and store certain personal information that our customers provide to purchase products or services, enroll in promotional programs, register on our web site, or otherwise communicate and interact with us. We may share information about such persons with vendors that assist with certain aspects of our business. Security could be compromised and confidential customer or business information misappropriated. Loss of customer or business information could disrupt our operations, damage our reputation, and expose us to claims from customers, financial institutions, payment card associations and other persons, any of which could have an adverse effect on our business, financial condition and results of operations. In addition, compliance with tougher privacy and information security laws and standards may result in significant expense due to increased investment in technology and the development of new operational processes.
The company is active in the American political arena, with published opinions, commentary and even product suggestions based on one’s political beliefs. Due to the polarizing nature of politics, the Company’s stance could adversely affect its reputation or draw the ire of political constituents.
We have not prepared any audited financial statements. Therefore, you have no audited financial information regarding the Company’s capitalization or assets or liabilities on which to make your investment decision. If you feel the information provided is insufficient, you should not invest in the Company.
Cyclical and seasonal fluctuations in the economy, in internet usage, and in traditional retail shopping may have an effect on our business. Both cyclical and seasonal fluctuations in internet usage and traditional retail seasonality may affect our business. These seasonal trends may cause fluctuations in our quarterly results, including fluctuations in revenues.
Start-up investing is risky. Investing in startups is very risky, highly speculative, and should not be made by anyone who cannot afford to lose their entire investment. Unlike an investment in a mature business where there is a track record of revenue and income, the success of a startup or early-stage venture often relies on the development of a new product or service that may or may not find a market. Before investing, you should carefully consider the specific risks and disclosures related to both this offering type and the company which can be found in this company profile and the documents in the data room below.
Your shares are not easily transferable. You should not plan on being able to readily transfer and/or resell your security. Currently there is no market or liquidity for these shares and the company does not have any plans to list these shares on an exchange or other secondary market. At some point the company may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when the company either lists their shares on an exchange, is acquired, or goes bankrupt.
The Company may not pay dividends for the foreseeable future. Unless otherwise specified in the offering documents and subject to state law, you are not entitled to receive any dividends on your interest in the Company. Accordingly, any potential investor who anticipates the need for current dividends or income from an investment should not purchase any of the securities offered on the Site.
Valuation and capitalization. Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult to assess and you may risk overpaying for your investment. In addition, there may be additional classes of equity with rights that are superior to the class of equity being sold.
You may only receive limited disclosure. While the company must disclose certain information, since the company is at an early-stage they may only be able to provide limited information about its business plan and operations because it does not have fully developed operations or a long history. The company may also only obligated to file information periodically regarding its business, including financial statements. A publicly listed company, in contrast, is required to file annual and quarterly reports and promptly disclose certain events — through continuing disclosure that you can use to evaluate the status of your investment.
Investment in personnel. An early-stage investment is also an investment in the entrepreneur or management of the company. Being able to execute on the business plan is often an important factor in whether the business is viable and successful. You should be aware that a portion of your investment may fund the compensation of the company’s employees, including its management. You should carefully review any disclosure regarding the company’s use of proceeds.
Possibility of fraud. In light of the relative ease with which early-stage companies can raise funds, it may be the case that certain opportunities turn out to be money-losing fraudulent schemes. As with other investments, there is no guarantee that investments will be immune from fraud.
Lack of professional guidance. Many successful companies partially attribute their early success to the guidance of professional early-stage investors (e.g., angel investors and venture capital firms). These investors often negotiate for seats on the company’s board of directors and play an important role through their resources, contacts and experience in assisting early-stage companies in executing on their business plans. An early-stage company may not have the benefit of such professional investors.
Frequently Asked Questions
A Side by Side offering refers to a deal that is raising capital under two offering types. This Side by Side offering is raising under Regulation CF and Rule 506(c) of Regulation D.
The Form C is a document the company must file with the Securities and Exchange Commission (“SEC”) which includes basic information about the company and its offering and is a condition to making a Reg CF offering available to investors. It is important to note that the SEC does not review the Form C, and therefore is not recommending and/or approving any of the securities being offered.
Before making any investment decision, it is highly recommended that prospective investors review the Form C filed with the SEC (included in the company's profile) before making any investment decision.
Rule 506(c) under Regulation D is a type of offering with no limits on how much a company may raise. The company may generally solicit their offering, but the company must verify each investor’s status as an accredited investor prior to closing and accepting funds. To learn more about Rule 506(c) under Regulation D and other offering types check out our blog and academy.
Title III of the JOBS Act outlines Reg CF, a type of offering allowing private companies to raise up to $1 million from all Americans. Prior capital raising options limited private companies to raising money only from accredited investors, historically the wealthiest ~2% of Americans. Like a Kickstarter campaign, Reg CF allows companies to raise funds online from their early adopters and the crowd. However, instead of providing investors a reward such as a t-shirt or a card, investors receive securities, typically equity, in the startups they back. To learn more about Reg CF and other offering types check out our blog and academy.
When you complete your investment on SeedInvest, your money will be transferred to an escrow account where an independent escrow agent will watch over your investment until it is accepted by DoneGood. Once DoneGood accepts your investment, and certain regulatory procedures are completed, your money will be transferred from the escrow account to DoneGood in exchange for your securities. At that point, you will be a proud owner in DoneGood.
To make an investment, you will need the following information readily available:
- Personal information such as your current address and phone number
- Employment and employer information
- Net worth and income information
- Social Security Number or passport
- ABA bank routing number and checking account number (typically found on a personal check or bank statement)
If you are investing under Rule 506(c) of Regulation D, your status as an Accredited Investor will also need to be verified and you will be asked to provide documentation supporting your income, net worth, revenue, or net assets or a letter from a qualified advisor such as a Registered Investment Advisor, Registered Broker Dealer, Lawyer, or CPA.
An investor is limited in the amount that he or she may invest in a Reg CF offering during any 12-month period:
- If either the annual income or the net worth of the investor is less than $100,000, the investor is limited to the greater of $2,000 or 5% of the lesser of his or her annual income or net worth.
- If the annual income and net worth of the investor are both greater than $100,000, the investor is limited to 10% of the lesser of his or her annual income or net worth, to a maximum of $100,000.
Separately, DoneGood has set a minimum investment amount of US $500.
Accredited investors investing $20,000 or over do not have investment limits.
You are a partial owner of the company, you do own securities after all! But more importantly, companies which have raised money via Regulation CF must file information with the SEC and post it on their websites on an annual basis. Receiving regular company updates is important to keep shareholders educated and informed about the progress of the company and their investment. This annual report includes information similar to a company’s initial Reg CF filing and key information that a company will want to share with its investors to foster a dynamic and healthy relationship.
In certain circumstances a company may terminate its ongoing reporting requirement if:
- The company becomes a fully-reporting registrant with the SEC
- The company has filed at least one annual report, but has no more than 300 shareholders of record
- The company has filed at least three annual reports, and has no more than $10 million in assets
- The company or another party purchases or repurchases all the securities sold in reliance on Section 4(a)(6)
- The company ceases to do business
However, regardless of whether a company has terminated its ongoing reporting requirement per SEC rules, SeedInvest works with all companies on its platform to ensure that investors are provided quarterly updates. These quarterly reports will include information such as: (i) quarterly net sales, (ii) quarterly change in cash and cash on hand, (iii) material updates on the business, (iv) fundraising updates (any plans for next round, current round status, etc.), and (v) any notable press and news.
Currently there is no market or liquidity for these securities. Right now DoneGood does not plan to list these securities on a national exchange or another secondary market. At some point DoneGood may choose to do so, but until then you should plan to hold your investment for a significant period of time before a “liquidation event” occurs. A “liquidation event” is when DoneGood either lists their securities on an exchange, is acquired, or goes bankrupt.
You can return to SeedInvest at any time to view your portfolio of investments and obtain a summary statement. If invested under Regulation CF you may also receive periodic updates from the company about their business, in addition to monthly account statements.
This is DoneGood's fundraising profile page, where you can find information that may be helpful for you to make an investment decision in their company. The information on this page includes the company overview, team bios, and the risks and disclosures related to this investment opportunity. If the company runs a side by side offering that includes an offering under Regulation CF, you may also find a copy of the DoneGood's Form C. The Form C includes important details about DoneGood's fundraise that you should review before investing.
For offerings made under Regulation CF, you may cancel your investment at any time up to 48 hours before a closing occurs or an earlier date set by the company. You will be sent a reminder notification approximately five days before the closing or set date giving you an opportunity to cancel your investment if you had not already done so. Once a closing occurs, and if you have not canceled your investment, you will receive an email notifying you that your securities have been issued. If you have already funded your investment, your funds will be promptly refunded to you upon cancellation. To cancel your investment, you may go to your portfolio page
If you invest under any other offering type, you may cancel your investment at any time, for any reason until a closing occurs. You will receive an email when the closing occurs and your securities have been issued. If you have already funded your investment and your funds are in escrow, your funds will be promptly refunded to you upon cancellation. To cancel your investment, please go to your portfolio page.