For most of modern finance, buying a stake in a promising young company was a privilege reserved for the wealthy and the well-connected. Equity crowdfunding broke that pattern by letting ordinary people put a few hundred dollars into a startup through a website. The model has grown into a real market. Investment crowdfunding in the US, which includes equity crowdfunding under Regulation Crowdfunding and Regulation A+, reached $924.8 million raised in 2025, up 58% from the prior year, according to Kingscrowd.
What equity crowdfunding actually means
Equity crowdfunding is the online sale of small ownership stakes in a private company to a large group of investors. In exchange for money, each backer receives shares, a SAFE, or a similar instrument that pays off only if the company grows or sells. It is different from reward crowdfunding, where backers get a product rather than ownership, and different from peer-to-peer lending, where investors are repaid with interest rather than holding equity.
In the US the practice runs on two main rules. Regulation Crowdfunding, known as Reg CF, lets a company raise up to $5 million a year from the general public. Regulation A+, sometimes called a mini-IPO, allows much larger raises with heavier disclosure. Both let non-wealthy investors take part, which is the feature that sets the model apart from traditional venture funding.
How the US market took shape
Equity crowdfunding became legal for ordinary investors after the JOBS Act, with Reg CF taking effect in 2016. The early years were modest as platforms, issuers, and investors learned the rules. Reg CF has now generated about $1.3 billion across nearly 3,900 offerings since launch, per Kingscrowd. A handful of platforms dominate the activity. Wefunder led Reg CF in 2025 with $109 million raised, followed by StartEngine at $89 million, DealMaker at $66 million, and Republic at $20 million.
The global picture is larger and still growing. The worldwide equity crowdfunding market was valued at about $2.1 billion in 2026 and is projected to reach $6.6 billion by 2035, a 13.8% compound annual growth rate, with North America leading, according to Business Research Insights. The same firms that built US digital lending platforms often sit near this market, since both turn online distribution into access to capital.
The 2025 surge was powered by a small number of large campaigns. Eight Reg A+ raises finished with more than $40 million each, including the news outlet Newsmax and the home-builder Boxabl, and most of those had originally launched in 2023 or 2024 before closing in 2025. That concentration is a strength and a weakness. It lifts the totals, but it also means a quiet year for big raises would pull the headline number down.
The numbers behind the 2025 surge
The 2025 jump was uneven across the two rules. Reg A+ did most of the heavy lifting, surging 124% to $546.6 million, while Reg CF grew a steadier 11% to $378.3 million even as the number of new offerings fell 29%.
| Segment | 2025 raised | Year-over-year change |
|---|---|---|
| Reg CF (equity crowdfunding) | $378.3 million | +11% |
| Reg A+ (mini-IPO) | $546.6 million | +124% |
| Total investment crowdfunding | $924.8 million | +58% |
Source: Kingscrowd, 2025 Investment Crowdfunding Annual Report.
The detail under those totals matters. Among 1,189 Reg CF closings tracked by Kingscrowd, 801, or 67.4%, met their funding targets. The average successful equity deal raised $572,000, the median was $194,000, and the typical raise drew about 285 investors at an average check of $1,716. Equity crowdfunding is a market of many small bets, not a few large ones.
What it means for consumers
For an everyday investor, equity crowdfunding opens a door that used to be closed. A person can back a brand they like or a founder they believe in for the cost of a nice dinner, and own a real stake if the company succeeds. The minimums are low and the platforms are easy to use, which is why a single raise can attract hundreds of backers.
The trade-off is risk and time. Startups fail often, shares cannot be sold easily, and a payout, if it comes, may take years. Unlike a public stock, there is no daily price and no quick exit. Backers should treat each investment as money they can afford to lose, much as they would with other early-stage bets described in our coverage of US fintech innovation and investment.
What it means for businesses raising money
For founders, equity crowdfunding is both capital and marketing. A raise turns customers into owners, which can build a loyal base that promotes the product. It also reaches money that traditional venture funds overlook, especially for consumer brands and regional businesses outside the main startup hubs. The cost is the work. A successful campaign needs disclosure, legal filing, and steady investor communication, and Kingscrowd noted that the issuers who win treat it as a real go-to-market channel rather than a one-time event.
The structure of the deals matters too. In 2025, common equity and SAFEs remained the two most-used formats, while debt and revenue-share deals kept shrinking, falling 10% to $38.7 million. That tells founders something useful. Retail backers on these platforms tend to want equity upside rather than fixed repayment, so a campaign built around ownership usually fits the audience better than one built around debt.
The risks on both sides
The model carries risk for everyone involved. Investors face the chance of total loss and little liquidity. Founders face the cost of compliance and the reputational hit of a public miss. Kingscrowd also flagged a reporting problem, noting that a large share of companies go quiet after they close a round, leaving backers without updates. Stronger disclosure rules and better investor tools are the most likely fixes.
Regulation is a live question heading into 2026. A capital-formation package moving through Congress, including the proposed INVEST Act, aims to ease some compliance thresholds for smaller issuers, which could lower the cost of running a raise. Any change to who counts as an accredited investor would also reshape how platforms design their offerings.
Equity crowdfunding has moved from an experiment to a working part of US capital formation, but its next stage depends on trust. The platforms and founders that report honestly and price fairly will be the ones that keep retail investors coming back.
