Invest in private credit deals
Invest in startups in exchange for equity or debt
Investments
$500
Investors can enter the private credit market via Percent with a minimum of $500, accessing a variety of asset-based securities and corporate loans.
Investments
$250
The minimum investment on StartEngine typically starts from $250, with the average being around $500.
Moderate Risk
3/5
Investing on Percent comes with inherent risks, despite efforts to minimize these through a proprietary risk framework for its own deals. The risk levels can vary across the platform, depending on whether Percent or a third party underwrites the deal.
High Risk
4/5
Investing on StartEngine carries risks including market volatility, liquidity challenges, regulatory changes, the high likelihood of company failure, dilution of shares, limited company information, and the absence of guaranteed returns.
Minimum Liquidity
1/5
Liquidity on Percent, as with many private credit platforms, varies by investment. Generally, these investments are less liquid than public stocks, tied to longer-term commitments without guaranteed immediate access to funds.
Minimum Liquidity
1/5
Liquidity on StartEngine Secondary varies due to its nature as a peer-to-peer trading platform with specific eligibility criteria and trading hours. Initially limited to companies that have raised on StartEngine, the platform's liquidity is influenced by the availability of securities and the matching of buy and sell orders within designated market hours.
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Moderate Return
13.41 %
As of February 1, 2024, Percent offers a 2.5% interest rate on idle cash in accounts and reports a historical weighted average APY of 13.41% on investments.
Not Predictable Return
N/P
Potential returns on investments are uncertain and vary. StartEngine's role ends after a company's capital raising concludes, leaving it without control or insight into post-offering investment activities.
Short-term Investment
3+ months
Percent offers investment horizons starting at 3 months, accommodating short-term investment strategies.
Long-term Investment
5+ years
Investments through StartEngine typically have a long-term horizon, often requiring several years to potentially yield returns due to the early-stage nature of the companies.
Who can invest
United States
Percent accepts investments only from accredited investors in the U.S. with U.S. bank accounts, adhering to Reg D 506(c) exemption rules.
Who can invest
International
StartEngine allows anyone over 18 to invest. However, due to regulatory concerns, StartEngine does not currently accept investments from residents of the UK or Canada.
Moderate Volatility
3/5
Assets on Percent generally show lower volatility than public market investments due to the nature of private credit, which often involves fixed returns from contractual agreements.
Moderate Volatility
3/5
Assets on StartEngine, mainly shares in startups and early-stage companies, exhibit high volatility due to uncertain revenues, evolving business models, and market sensitivity.
Regulation and audits
SEC Regulated
Percent is regulated under Regulation D, 506(c) of the Securities Act, allowing only accredited investors to participate after verifying their status.
Regulation and audits
SEC Regulated
StartEngine operates under strict regulatory oversight by the SEC and FINRA, ensuring adherence to investor protection and market integrity rules.
Insurance
Yes
Funds deposited with Percent are held at an FDIC-insured bank, ensuring protection up to $250,000, the maximum allowed by law, providing security for investors' capital in case of a bank failure.
Insurance
Yes
StartEngine's memberships with FINRA and SIPC signify its commitment to investor protection, with SIPC offering insurance against the loss of cash and securities if a broker-dealer goes bankrupt. However, it doesn't cover market loss.
Payouts
No Recurring Payouts
Percent provides returns through interest payments or fixed returns from private credit deals, rather than traditional dividends.
Payouts
No Recurring Payouts
Dividends on StartEngine depend on the individual company's policy and investment terms, with startups often reinvesting profits to fuel growth rather than distributing dividends.
Withdrawals
Upon investment maturity on Percent, funds (principal and yield) are credited to the investor's account. Investors can then transfer these funds to an external account or reinvest.
Withdrawals
Investors can withdraw available funds from their StartEngine Investment Account after a 10-day waiting period from the initial transfer, subject to providing additional information for security if needed.
Extra Fees
Yes
From September 2023, Percent charges a fee of 10% on interest payments, not affecting the principal.
Extra Fees
Yes
Investors may encounter a 3.5% processing fee on investments, depending on the company's choice. Wire transfers could have additional bank fees, while ACH and credit card investments don't have extra fees beyond the 3.5% if applicable. Trading on StartEngine Secondary is free for buying, but selling shares includes a 5% transaction fee.
Taxes
Tax Form
Percent provides investors with a consolidated 1099-INT form each tax year, reporting all investment income as ordinary income for tax purposes.
Taxes
Annual Statement
Investors must procure the necessary tax documents directly from the entities in which they have invested, since StartEngine does not distribute tax forms.