Reasons to Consider a Crowdfunding Transfer Agent

Crowdfunding is a way to raise money for a small startup or venture. You collaborate with a variety of investors and entrepreneurs who have money to donate to your cause. When you choose securities-based crowdfunding, you get equity from the investors in return for investment income or dividends. While it is legal, you must remain compliant with all SEC rules, so it is best to have a crowdfunding transfer agent available to help you raise money through this practice.


You need to have peace of mind knowing that everything you do is compliant and legal. Your investors want peace of mind knowing that you have someone available that can manage their and your stock. Having a crowdfunding transfer agent means that you can attract more investors. You can tell them about your agent so that you look more professional and they feel more comfortable.

Safe Harbor

The SEC has an exemption called safe harbor, and you can utilize this exemption if you choose a registered transfer agent. Therefore, you have less liability from investors and regulators.

Save Money

When you choose a crowdfunding transfer agent, you save a lot of money on any ongoing and startup processing or shipping fees that are associated with your physical stock certificates. Most of the time, you must give people stock in your company to get them to invest. However, sending out all those stock certificates is time-consuming and costs a lot. You have to get them printed out, mail them to the correct location, and risk having them lost. In most cases, you need to insure these documents, as well. However, agents usually have automated or electronic options, which allows you to send the information electronically, reducing paper waste and lost certificates. Shareholders can also view their information whenever they want. Visit Colonial Stock Transfer for more information.

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