Fin-Creator FAQs

Frequently Asked Questions

Getting Started

How do invest in Startups?

Equity crowdfunding is the process where people, or “the crowd”, invest in a private business or startup in exchange for shares of that company. If the company does well, the shareholders do well (and if it fails, well…).

Since the JOBS Act was passed in 2012, virtually anyone over the age of 18 can now invest in equity crowdfunding startups.

Investing in a company early allows you to be a part of their growth. Prior to the signing of the JOBS Act, the only players able to make major gains on startup investments were venture capitalists and accredited investors. Startups are risky ventures, but wildly popular with investors because of their potential for major returns. Additionally, it gives investors an opportunity to vet companies that share their values.

Thanks to a little thing called equity crowdfunding, anyone over the age of 18 is eligible to invest in startups. The simplest way to invest is to head to any equity crowdfunding platform, such as StartEngine, Republic, WeFunder, Seeders, SeedInvest (the list goes on), register, and start investing.

Investing in NFTs

Cryptocurrency, or crypto, is a digital currency designed to work as a medium of exchange through a computer network that is not reliant on any central authority, such as a government or bank, to uphold or maintain it.

Cryptocurrencies run on a distributed public ledger called blockchain, a record of all transactions updated and held by currency holders. Units of cryptocurrency are created through a process called mining, which involves using computer power to solve complicated mathematical problems that generate coins.

The easiest way to acquire cryptocurrency is to purchase on an online exchange like PayPal, Robinhood, Venmo, or Coinbase.

No. Like shares of a company, you’re not required to buy an entire unit–you can buy portions of coins in increments as little as 2 dollars, euros, pounds, or your local currency.

Investing in Cryptocurrency

NFT stands for non-fungible token.

An NFT is a non-replaceable unit of data stored on a blockchain, a form of digital ledger, that can be sold and traded. NFTs can be anything digital–a video, a picture, music.

NFTs are essentially pieces of artwork or collectibles, only digital. Buyers received a digital file and exclusive ownership of the digital works they purchase. NFTs’ unique data makes it easy to verify their ownership and transfer tokens between owners. The owner or creator can also store specific information inside them, such as an artist’s signature, in the NFT’s metadata.

To buy an NFT, you’ll need to open and fund a crypto wallet on an NFT marketplace. A crypto wallet, like a digital wallet on an e-commerce platform, stores cryptocurrencies needed to purchase an NFT. A wallet needs to be funded with the crypto needed to buy a targeted NFT, like Ether tokens for Ethereum NFTs or ZIL for Zilliqa NFTs. Top NFT marketplaces include OpenSea, Rarible, SuperRare, and Foundation.

Investing in Stocks

The stock market is where buyers and sellers come together to trade shares in eligible companies.

Almost anyone can invest in the stock market. In the United States, investors must provide a Social Security number and other personal identifying information in order to purchase stock.

One of the best ways for beginners to get started investing in the stock market is to put money in an online investment account, which can then be used to invest in shares of stock or stock mutual funds.

The stock market is where the general public can access stocks of publicly traded companies. They function kind of like a farmers’ market, with buyers and sellers meeting in one place to exchange things. But stock markets are much more complex and regulated, with prices that can change rapidly. Here are three key activities you’ll find on a stock market:

  1. Stock buying: Both everyday retail investors and sophisticated institutional investors can purchase shares of companies.
  2. Stock selling: Every stock trade has a buyer and a seller.
  3. Issuance of stocks: If a private company wants to raise money, it may agree to sell a portion of its ownership on the stock market. This is what happens during an initial public offering (“IPO”). If an existing public company wants to raise money it may do so through a secondary public offering. In both cases, after the stock is issued, it can be bought or sold by the public (see those first two bullets above).

Stocks aren’t the only thing that can be bought or sold on a stock market. Other “securities”, such as exchange-traded funds (ETFs) or REITs are also traded on the stock market (some details about how they’re priced or traded differ though).

Yes. If you invest in the stock market, it’s important to keep in mind both the short-term and long-term risks. Just as stock prices can rise, they can also fall. Sometimes by a lot. The price of a stock can drop to $0, and this may result in the total loss of an investment. Given this risk, investors should have a thoughtful strategy in place to help guide their decisions.

The primary role of the stock market is to bring buyers and sellers together to negotiate the trade of stocks. To determine the price, a stock market operates kind of like an auction.

Buyers want to pay the lowest price possible. Stockbrokers who want to buy (or who represent customers who want to buy) can bid a price they’re willing to pay for a stock. The highest price becomes the “Best Bid.”

Sellers want to sell at the highest price. Owners of stock or their stockbrokers can show their willingness to sell by placing an ask, which is the price they’re willing to sell a stock for. The lowest price becomes the “Best Ask.”
The difference between the Best Bid and Best Ask is called the “Spread.” The two sides negotiate to meet in the middle, and the intermediary who executes the trade takes the difference as their fee.

As you follow a stock, you’ll notice the share price moves. The share price can change frequently based on the number of investors looking to buy or sell the stock and the number of trades that happen.

Stocks are traded on an individual basis through the negotiation between the bid and ask prices. Those prices can move together with stocks of other companies as economic, political, and specific news stories affect the movement of markets in general.

Here are some of the key players you should know about:

  1. Retail investors like you can buy or sell individual stocks through your brokerage account. When you place an order, it’s sent to exchanges where the trades are executed.
  2. Stockbrokers are “registered representatives” who have gone through training and passed a licensing exam. They can buy and sell securities on behalf of investors. Stockbrokers work for brokerages, which can act as principals or agents in transactions, making money through markups/markdowns (as principals) or commissions (as agents) on trades. Many brokerages charge fees to their customers who use the brokerage to place orders and execute the trade of a stock.
  3. Portfolio managers act like restaurant owners — they’ll order a ton of food because they’re feeding plenty of people. Portfolio managers make large orders to buy and sell stocks because they manage relatively large stock portfolios, which can be owned by other investors like you. If you own shares in a fund (a mutual fund, retirement fund, pension fund, etc) a portfolio manager likely handles the bundle of underlying securities (stocks, bonds etc.) in the fund’s portfolio.
  4. Investment bankers help companies list shares on stock exchanges.

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