Frequently Asked Questions
Starting a new business?
How is a money making idea germinated?
- Identifying a solution to an existing common problem.
- Identifying a simpler and much lower cost solution than the solution which now exists for a common problem.
- Filling a need that is shared by many.
How to determine if idea for startup can be commercialized?
- How much would someone (YOU) be willing to pay for the solution?
- Determine the cost to provide the solution.
- If cost to provide solution is lower than price willing to pay go to next question.
How is a startup financed?
- Self-financing to prove out product or concept.
- Friends and family investors.
- Angel investor(s) or incubator.
What is the initial amount that is raised for the founder’s round of a startup?
What percentage of the company should first investor(s) receive?
Generally between 10% and 20%.
Could I have made $2 million, $1.25 million and $240K from investing $100 in Airbnb, UBER and Snapchat?
No. Since the ban prohibiting the public from investing small amounts in startups was not lifted until May 2016, no one could have invested $100 into these companies when they were startups. Additionally, SproutUps was founded after the opportunities to invest in these companies were available.
Are you an investor?
Do I have to be a member of SproutUps to invest in the startups that are identified?
No. However, being a member enables you to receive email alerts about when the opportunities become available. Becoming a premium member will enable you to get text alerts and a guaranteed allocation of a minimum number of new opportunities per year that SproutUps identifies. A hot startup can sell out quickly since the founders only want to sell minimal shares at the extremely low prices.
How does SproutUps find its startups?
From attending conferences and functions that are attended by the world’s startups who are disruptors and first movers. These conferences are held by TechCrunch and Emerge Americas annually in New York, London, Berlin, Beijing, Miami and San Francisco. SproutUps also attends and exhibits at local and regional events which are attended by startups that are held by many of the world’s major universities and cities.
Do I give my money to SproutUps to invest for me?
No. SproutUps is not an investment firm. We identify startups for our members to invest and notify them by text and email alert when the offering of the startup becomes available on a government regulated online funding platform. Upon receiving the alert a member goes to the platform to invest in the startup which SproutUps has identified.
Since I have never invested before how do I decide what to invest in?
SproutUps’ team screens all of the startups before it sends you an alert to consider to invest in any one company.
Do I have to invest in every company that SproutUps identifies?
No. If you do not like the startup or the industry that it is you can choose to not invest.
What is the difference between a startup and an early stage company?
A startup is similar to a newborn infant. A company in an early stage is equivalent to a one to two year old baby.
What is a seed round financing?
A seed round financing is normally the first round that an investor can invest in after the founder’s round has been completed.
Can I invest in a founder’s round?
Not generally. The capital for a founder’s round is generally provided to the startup by the individual(s) who came up with the idea and their close relatives.
What is the success rate of a startup becoming a successful company?
Approximately 20%. It’s why you want to diversify and invest into many instead of just one or a few.
How do I know which platform to go to for making my investments?
SproutUps directs investor to the government regulated funding platform which the shares of the startup are being offered. Members of SproutUps receive email alerts. Premium members receive text alerts.
How do I keep track of my investments that SproutUps identifies?
The platforms that you utilize to make your investments keep a record of the investments that you make for you.
After I make the investment in the startup am I provided follow up information as it develops?
SproutUps follows and provides reports on the startups that it identifies. The startups which are identified by SproutUps are also required to provide financial updates to their investors.
Why are most of the Digital Economy videos on the SproutUps web site produced by Dynasty Wealth?
Dynasty Wealth (DW) is one of SproutUps’ research partners. DW introduces some of the companies that it finds to SproutUps. The startup investing philosophy for both SproutUps and Dynasty Wealth is based on the research that was conducted by visionary analyst Michael Markowski. He is a SproutUps advisor. For more information about him go to www.michaelmarkowski.net.
Could anyone have made $200,000, $125,000 and $240,000 from investing $100 in Airbnb, UBER and Snapchat?
No. Since the ban prohibiting the public from investing small amounts in startups was not lifted until May 2016, no one could have invested $10 into these companies when they were startups. Additionally, SproutUps was founded after the opportunities to invest in these companies were available.
Statements made by SproutUps.com pertaining to returns made from investing in Airbnb, UBER and Snapchat are not indicative of a TRACK RECORD. They are examples for educational purposes only.