Types of Offerings and Securities in Crowdfunding
The offering types you’ll see, and the securities you actually own or issue in a raise.
Short answer
Two things vary in a private raise: the offering type (the SEC exemption used, like Reg CF, Reg A, or Reg D) and the security itself (what you actually own or issue). Securities range from equity and preferred shares to SAFEs, convertible notes, revenue-share agreements, and debt. This guide explains both, and how to tell them apart.
Offering types, in brief
Most online raises use one of three SEC exemptions: Regulation Crowdfunding (Reg CF, up to $5M a year from anyone), Regulation A+ (up to $75M a year, the “mini-IPO”), and Regulation D (unlimited, mainly from accredited investors). A fourth, Regulation S, covers offerings made outside the U.S. For a side-by-side comparison, see our full Reg CF vs Reg A vs Reg D guide.
The securities you can buy or issue
Equity (common stock)
Direct ownership, usually with voting rights.
Preferred stock
Ownership with priority over common stock on dividends and in a liquidation.
SAFE
A contract that converts to equity at a later priced round, set by a valuation cap or discount.
Convertible note
Short-term debt that converts to equity later, usually with interest and a maturity date.
Revenue share
Repaid from a share of future revenue rather than through ownership.
Debt
A loan repaid with interest, with no ownership.
How to tell what you’re getting
The security type decides your rights, your risk, and what your investment is worth if the company succeeds. Always confirm the security and its terms in the offering documents, which for Reg CF means the Form C. Our guide on how to evaluate a startup investment covers what to check.
Combining offerings
Companies sometimes run more than one offering at once, for example a Reg CF round for the community alongside a Reg D round for accredited investors, to reach both audiences. See how they compare.
Frequently asked questions
What are the types of securities offerings?
Common exemptions are Reg CF, Reg A+, and Reg D. The securities themselves include equity, preferred stock, SAFEs, convertible notes, revenue share, and debt.
What’s the difference between equity and a SAFE?
Equity is ownership now. A SAFE is a contract that converts into equity later, at a priced round, based on a valuation cap or discount.
What is revenue-share investing?
A structure where investors are repaid from a percentage of the company’s future revenue rather than through ownership.
Which offering type is right for my raise?
It depends on how much you want to raise and who can invest. Compare Reg CF, Reg A+, and Reg D in our full guide.
Can a company use more than one offering type?
Yes. A common setup is a Reg CF community round alongside a Reg D accredited round. Concurrent offerings come with compliance considerations, such as keeping the offerings properly separated and marketing each one within its own rules, so speak with a securities attorney before running them together.
Key takeaways
Offering type (the exemption) and security type (what you buy) are different things.
Securities span equity, preferred, SAFEs, notes, revenue share, and debt.
The security decides your rights and your risk.
Always check the
Educational only. This article is not legal, tax or investment advice. Regulation Crowdfunding is codified at 17 CFR Part 227 and changes over time; confirm current requirements with securities counsel before you rely on them.
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