{"id":3558,"date":"2021-09-17T12:48:37","date_gmt":"2021-09-17T12:48:37","guid":{"rendered":"https:\/\/blog.ethis.co\/?p=3558"},"modified":"2022-11-15T04:13:13","modified_gmt":"2022-11-15T04:13:13","slug":"investing-equity-crowdfunding-pros-cons","status":"publish","type":"post","link":"https:\/\/ethis.co\/blog\/investing-equity-crowdfunding-pros-cons\/","title":{"rendered":"Investing through Equity Crowdfunding (ECF): The Pros and Cons"},"content":{"rendered":"\n

If you are not familiar with the term ECF, you may wonder, what in the world is ECF? Equity crowdfunding<\/a>, or ECF, is essentially an online fundraising campaign that allows individuals the opportunity to invest in an early-stage venture or micro SMEs. In exchange for the money invested, investors will own a proportionate slice of equity (shares) in the company. 

Related: Islamic Crowdfunding: A Shariah-Compliant Investment Alternative<\/a><\/p>\n\n\n\n

Before the advent of crowdfunding<\/a>, investing in such ventures was only restricted to accredited investors and high net worth individuals, i.e. investors with a certain defined level of income or assets, who can afford the high minimum investment amount that comes with high risks, and high potential returns. <\/p>\n\n\n\n

Equity crowdfunding has allowed non-high-worth individuals to play the field. It makes such investment accessible to a larger pool of investors by offering a much lower minimum investment threshold than it used to be. <\/p>\n\n\n\n

Before we dive deep into the pros and cons of investing via equity crowdfunding, let\u2019s take a look at the types of investors as classified by the Securities Commission Malaysia (SC).<\/p>\n\n\n\n

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Table of Contents<\/p>\n