Flexible Crowdfunded Working Capital Financing for Small Businesses Affected by COVID-19
Update: Our Community Bridge Notes can be executed even more quickly and cost effectively as a direct result of the SEC’s temporary expansion of certain provisions of Regulation Crowdfunding. Businesses must act fast, as the rules changes are only for offerings launched before 8/31/20. Learn More
• Campaigns were previously required to stay open for at least 21 days. Under the expanded rules, campaigns can now close within 48 hours of meeting their minimum targets.
• Businesses are no longer required to provide third-party CPA reviewed financials for raises up to $250,000 (previous threshold was $107,000).
• These rule changes are temporary. Only offerings launched before 8/31/20 are eligible to leverage the new guidelines.
NextSeed has always been about connecting investors who care with businesses that matter. On the NextSeed platform, businesses can raise capital directly from community-minded investors that already know and love their businesses -- investors that want these businesses to exist tomorrow.
In this challenging and unprecedented environment, we are ready to help businesses raise the working capital they need to reach the other side of this crisis.
In this spirit, NextSeed is rolling out a special financing product for qualified small businesses to utilize in a public offering. The NextSeed Community Bridge Note (CBN) will leverage Regulation Crowdfunding rules to provide small businesses with an alternative and efficient way to raise flexible, lower cost, lower fee financing. The NextSeed CBNs are designed to meet the working capital needs of small businesses during and in the immediate aftermath of COVID-19.
By investing in these notes, investors can participate in the recovery and the eventual return to growth of businesses that they care about.
Interested in applying for a NextSeed Community Bridge Note?
Get started on the quick online application process.
If you know a business owner currently in need of short-term bridge capital to help their business navigate the economic shutdown caused by COVID-19, let them know about the program and quick online application process.
Interested business owners can also reach out directly to the NextSeed investment banking team at firstname.lastname@example.org
As new Community Bridge Notes become available for investment on NextSeed, they will be listed here along with our other investment opportunities.
Please consider a tax-deductible donation to our Local Impact + Food Entrepreneurs Fund. The LIFE Fund allows people to make donations that will be used by local restaurants to deliver meals to front line healthcare workers. In this way we are supporting both local businesses as well as healthcare professionals.
Learn more at nextseed.link/lifefund
Why is NextSeed designing these notes differently than existing securities offerings?
This crisis is affecting small businesses across the country, and time is of the essence. We’ve designed this product to provide small businesses the opportunity to raise capital directly from their network and community at favorable but structured terms.
While we will still be running background checks and basic diligence to ensure the businesses qualify for Regulation Crowdfunding, we will not be running our normal diligence process across these offerings. This streamlined process will allow businesses to undergo an expedited review and fundraising process to meet their immediate needs. This also provides potential investors with a uniform framework to determine which businesses they would like to support with their investments.
What if the Community Bridge Note is not what my business needs at this moment?
We’ve raised millions of dollars for businesses at various stages of growth. If you are looking to raise capital for a new business, expanding your existing business, or not immediately affected by the current crisis, please explore the other products and services that NextSeed offers.
How much can a business raise with a NextSeed Community Bridge Note?
Utilizing Regulation Crowdfunding, a business can raise up to $1.07M every 12 months. Apply for the amount you need, and our team will work with you to determine a target based on historical and projected performance to ensure the financial health of the business. Note: Companies seeking to raise over $107,000 must provide independently reviewed financial statements (learn more) or audited financial statements as applicable.
Is there a minimum that a business must raise?
Businesses must raise a minimum of $10,000 in investments in order to receive funds.
How do the payments work for businesses and investors?
Revenue sharing notes like the Community Bridge Note are paid as the business generates revenue. Businesses report their monthly revenue through their Point of Sale and bank statements, and NextSeed pulls the funds to distribute payments to investors on a monthly basis. (Learn more about revenue sharing)
How will businesses raise money from the public?
NextSeed offers an online platform to simply raise capital from many investors. We’ll walk you through the legal and filing process, and we’ll give you the tools to quickly create a campaign page. We’ll also give you a playbook with tips on how to promote your campaign to your community of friends, family, and patrons. By listing your offering on NextSeed, you will also get access to our network of thousands of local investors.
How long will these notes be offered to businesses and investors?
This is a special crowdfunding solution designed for the unique challenges businesses are facing during the COVID-19 health and economic crisis. These securities will only be offered for as long as market conditions necessitate.
Does NextSeed collect a fee from investors?
For investments in Community Bridge Notes, we are eliminating all investor fees.