Startup investing through equity crowdfunding is an exciting investment sector with the potential to make investors rich overnight.
Getting in early on the next Google or Facebook could change your financial future overnight. Although not every startup investment will come off quite that well, early investors in Atlis Motor Vehicles Inc. AMV made a pretty penny when it went public late last year.
Atlis Motor is a startup company that builds bespoke, all-electric, full-size pickup trucks. In addition to trucks, the Atlis Motor team was also developing rapid-charging stations that were capable of delivering a full charge to one of its vehicles in 15 minutes. Its mission of offering a low-priced, customizable all-electric truck to the market directly through an online portal made for an exciting investment opportunity.
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In years past, the only people who could’ve gotten in early on Atlis Motor were venture capitalists or well-connected investors who bought into the right VC funds. The Jumpstart Our Business Startups (JOBS) Act of 2012 opened up equity crowdfunding opportunities to more investors than ever before. This paved the way for companies like Atlis Motors to make offerings available through platforms like StartEngine.
In 2016, Atlis Motor made its first offering on StartEngine. At the time, investors had the opportunity to buy common stock for only 29 cents per share with the caveat that they would make a minimum investment of $203. This minimum investment would see investors holding 700 shares of Atlis Motor stock.
Sweetening the pot further, investors who made investments of more than $1,000 received an extra 10% share bonus. So a $1,000 investment at 29 cents per share would have purchased 3,448 shares plus another 345 shares. That would leave you with a total of 3,793 shares. Needless to say, the chance to buy nearly 4,000 shares of stock in an electric vehicle (EV) startup for less than most people spend on lattes in a year ($1,000) was an appealing prospect for many investors.
Atlis Motors hit its $1 million funding goal with that original offering on StartEngine. In fact, the initial equity crowdfunding raise was so successful, Atlis stock split 2 for 1 before their second equity crowdfunding raise. That means early investors who took advantage of the 10% share bonus for the $1,000 investment ended up with 7,586 shares.
As the momentum surrounding EVs began to build and Atlis Motors ramped up its capabilities, it soon became clear that early investments in Atlis Motor would have a handsome payoff when the company went public. Atlis Motor made an initial public offering (IPO) on the Nasdaq Stock Exchange in late September. As is the case with many successful IPOs, the stock’s value shot up like a rocket and closed at $82.12 on Sept. 27.
Early Atlis investors who took advantage of the 10% extra shares for $1,000 offer could have sold their 7,586 shares for $622,962.32! That is quite a healthy return on a $1,000 investment. Investors who bought $10,000 worth of shares on the first equity crowdfunded offering became multi-millionaires if they sold at the IPO in September.
Since the IPO, Atlis Motor’s share value has gone down — along with Tesla Inc. and Rivian Automotive Inc. But even with the decline, early investors who took advantage of Atlis Motors’ initial offering on StartEngine are still winning. Atlis Motors is currently trading at $10.08, which means original investors at the 29 cents per share price still made a nearly 3,500% profit if they sold their shares today….on double the amount of shares they originally purchased.
These are the kind of massive capital gains that startup investing through equity crowdfunding offerings can yield for investors. If you’re looking for a way to turbocharge your portfolio, there’s lots of great startup investments out there. Building a diverse portfolio of startup offerings could be the ideal way to build a low-risk, high-reward scenario for yourself.
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