Frequently Asked
Questions



(312) 224-8749

Business

1What happens when investors commit capital to my campaign?
Funding commitments on Bolstr represent the submission of non-binding commitments of interest to invest in a business. Once the funding goal is met, our 3rd party payments processor will charge each investor’s linked bank account the amount they agreed to invest, and deposit the total amount into a secure escrow account.
2What happens when I reach my campaign goal?
1. Investment capital will be automatically transferred from each investors bank account into an escrow account held by a secure 3rd party.
2. You will then receive a notification to login to your account, and electronically countersign each revenue share agreement between you and investors.
3. Once all revenue share agreements have been countersigned, funding will be transferred from escrow into your business bank account.
3How long does a campaign last?
Each campaign will be live for a max of 30 days, though most close within a week. If a campaign does not reach its intended goal within that time frame, the campaign will close unsuccessfully. If the campaign is unsuccessful, the business will receive none of the investment capital that was contributed.
4What is an Investment Multiple?
For example:
Let’s say you raise $100,000, and agree to share 3% of revenue with investors until they earn 1.2x their investment back. In this scenario, investors would receive 3% of your revenue, paid monthly, until they were paid back $120,000 ($100,000 X 1.2x)
5How are the payout amounts determined?
Payouts to investors are based on a predetermined percentage of revenue. Each month, investors will receive a payout based on this predetermined percentage, which is calculated by multiplying the gross revenue generated by the percentage of revenue (i.e. gross revenue X percentage of revenue = investor payout).
6What is the percentage of revenue?
The Percentage of Revenue is defined as the total percentage of gross revenue your investors are collectively entitled to. Individually, each investor is entitled to a pro-rata share of the percentage of revenue, based on the amount of money they contribute towards the fundraising goal.
For example: If an investor were to invest the full amount of the fundraising goal, they would be entitled to the entire payout amount. If they were to invest an amount less than the fundraising goal, they would be entitled to a pro-rata share of the payout amount.)
Investor Payout = (Investment / Fundraising Goal) x (Gross Revenue x Percentage of Revenue)
7How long do the payouts last?
Payouts to investors will occur at the end of every calendar month, until investors achieve the predetermined investment multiple.
8How do I link my business bank account, or other business account?
To link your account, simply click on the gearbox in the upper right corner of your screen, and select “My Linked Accounts” from the dropdown. Then follow the steps to add your account.
9How does Bolstr handle business bank account verification?
Account verification is done via micro-deposits. Micro-deposits are two small deposits that Bolstr sends to your financial account within 1-2 days of the linking of your account. Once the micro-deposits have posted to your bank account, you will login to Bolstr and navigate back to the “My Linked Accounts” section found in the settings drop down. Select “Verify” next to your linked account, and enter the amounts that posted to your bank account.
Once you’ve entered the micro-deposit amounts your account will be verified!
10Does Bolstr provide a 1099 to investors?
Yes, Bolstr provides a 1099 to investors at the end of each calendar year.

Investor

1How do I invest?
Investing on Bolstr is really easy. Once you’ve reviewed the businesses campaign overview, simply click on “Investment Overview” and follow the wizard through the investing process. Once the business successfully reaches their goal, funds will be pulled from the account you linked and placed into an escrow until the closing process is completed.
2How do I link my bank account, or other investment account?
To link your account, simply click on the gearbox in the upper right corner of your screen, and select “My Linked Accounts” from the dropdown. Then follow the steps to add your account.
3How does Bolstr handle bank account, or other investment account verification?
Account verification is done via micro-deposits. Micro-deposits are two small deposits that Bolstr sends to your investment account within 1-2 days of the linking of your account. Once the micro-deposits have posted to your bank account, you will login to Bolstr and navigate back to the “My Linked Accounts” section found in the settings drop down. Select “Verify” next to your linked account, and enter the amounts that posted to your bank account.

Once you’ve entered the micro-deposit amounts your account will be verified!
4Do I have to be an accredited investor to invest on Bolstr?
Yes, any investor that wishes to participate in the Bolstr Marketplace must first be verified to as an accredited investor.
5What is the definition of an accredited investor?
An individual accredited investor is defined by the Securities and Exchange Commission ("SEC") as the following:

1. A natural person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person; or
2. A natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year.

For the complete definition, including other types of accredited investors, such as investment companies please see the SEC's website.
6How do I verify i am an accredited investor on Bolstr?
On Bolstr, there are two ways you can verify your accredited status. To get started simply click on the link from your dashboard or navigate to the “verify investor status” section of the settings dropdown:

Verify via third party:
1. Enter contact information for a person who can verify you. This can be anyone who has direct knowledge of your annual income or net worth, such as your Investment Advisor or Certified Public Accountant.
2. Click on the "Send Verification Letter" button.
3. After you hit send, we will email your Verifier a letter for electronic signature, where they will have the ability to confirm your status. To expedite your verification, please email your Verifier separately, and let them know you're awaiting their sign-off.

Self verification:
1. Simply upload the requested documents and hit submit
2. A Bolstr representative will then review your documents, and approve your status should you meet the requirements. You will then be notified that you are eligible to start investing.
7How are the payout amounts determined?
Payouts to investors are based on a predetermined percentage of revenue. Each month, investors will receive a payout based on this predetermined percentage, which is calculated by multiplying the gross revenue generated by the percentage of revenue (i.e. gross revenue X percentage of revenue = investor payout).
8How do I verify my investment company as an accredited investor on bolstr?
To certify that your investment company is an accredited investor, please email [email protected] one of the following:
  1. Proof of registration with the SEC. Acceptable Documentation may include:
    • Form N-1A (Registration form for mutual funds).
    • Form N-2 (Registration form for closed-end funds).
    • Form N-3 (Registration form for separate accounts that offer variable annuity contracts that are registered under the Investment Company Act as management investment companies. The term “separate account” is defined in Section 2(a)(37) of the Investment Company Act.).
    • Form N-4 (Registration form for separate accounts that offer variable annuity contracts that are registered under the Investment Company Act as UITs).
    • Form N-6 (Registration form for separate accounts that offer variable life insurance policies that are registered under the Investment Company Act as UITs).
  2. Proof that the investment company is a partnership with $5 million+ in assets Acceptable Documentation may include:
    • YTD Audited financial statements of the investment company
  3. Proof that all equity owners of the Investment Company are accredited Investors
If you have more questions about what an Investment Company is, or would like a complete list of acceptable documentation that proves your Investment Company is an accredited investor, please reference SEC Guidelines.
9What happens when the business reaches their fundraising goal?
When a business reaches their funding goal, the Bolstr campaign will be locked to any new commitments. Investor funds will be pulled from their linked account and placed into a secure escrow account until the business countersigns each revenue sharing agreement. Once documentation is complete, funds will be transferred from escrow into the businesses account, and you will be able to access the fully executed agreement via the “download investment agreement” link on your account dashboard.
10So I’m only obligated to fund if the business hits its goal?
That’s right. The business owner is only able to access funding if they successfully reach their goal.
11If the businesses goal is reached, how do I get paid back?
Each month the business will report the amount of gross sales they generated. We’ll then calculate what portion of the share is attributed to you, and send you a notification when a payment has been made. Payments will be directly deposited into your linked account.
12How do I know the business reported their monthly revenue accurately?
We require each business to upload a financial statement confirming the amount of revenue they generated during the month of each payout. At the end of the year, each business must also upload their year-end tax return, and true investors up for any discrepancies.
13How does a revenue sharing agreement work?
A Revenue Sharing Agreement is a contract between a business and their investors. Through a revenue sharing agreement, the business agrees to share a percentage of their gross revenue with their investors (paid monthly), until a predetermined multiple on their investment is achieved. Investors will not own any equity in the business.

What is an investment multiple?

An Investment Multiple represents the total amount investors are owed for their investment, inclusive of their initial investment plus a return.

For example: Let’s say a business raises $100,000, and agrees to share 3% of revenue with investors until they earn 1.2x their investment back. In this scenario, investors would receive 3% of the businesses revenue, paid monthly, until they were paid back $120,000 ($100,000 X 1.2x).

Once the Investment Multiple is achieved, investors no longer have an investment interest in the business.

How are the payout amounts determined?

Payouts to investors are based on a predetermined percentage of revenue. Each month, investors will receive a payout based on this predetermined percentage, which is calculated by multiplying the gross revenue generated by the percentage of revenue.

The percentage of revenue represents the total share of gross revenue investors are collectively paid each month. Individually, each investor is entitled to a pro-rata share of the percentage of revenue based on the amount of money they contributed towards the fundraising goal.

Investor Payout = (Investor Investment Amount / Fundraising Goal) X (Monthly Revenue X Percentage of Revenue)
14Does Bolstr guarantee repayment of revenue sharing agreements?
No. Bolstr does not guarantee the repayment of revenue sharing agreements. Investing in startups and early stage small businesses is very risky, and anyone considering making an investment on Bolstr should only do so if they can afford the loss of their entire investment. You should carefully consider the specific information and risks disclosed by the issuer of the securities. You should not invest any funds in an offering unless you can afford to lose your entire investment.

In some cases, investment opportunities will include certain investor protections. These may or may not include personal guarantees from the business owner and/or asset security agreements.
15How long does a campaign stay up on the Bolstr platform?
Each campaign will be live for a max of 30 days, though most close within a week. Once the business reaches its funding goal, the campaign will close and no further commitments of interest will be accepted.
16What happens if the campaign doesn’t reach its goal?
If a campaign does not reach its funding goal in the allotted time, the campaign will close unsuccessfully. In this scenario, any investor commitments will be automatically canceled.
17Does Bolstr provide a 1099 to investors?
Yes, Bolstr provides a 1099 to investors at the end of each calendar year.