Our Screening Process
ChainRaise has many companies apply to raise capital. For a company to get accepted, it must pass our 5 step ChainRaise Due Diligence Process.
First and foremost, we want to bring on investment opportunities that make us feel excited!
A ChainRaise representative goes through a discovery phase with an Issuer, and keep a careful eye to notice any pattern of incompetence demonstrating a lack of responsibility. Examples to cause a rejection include poor communication, incompetent financial documents, or failure to demonstrate the ability to responsibly allocate investor’s capital.
Rule 503 of Regulation Crowdfunding states a “bad actor check” must be done prior to hosting an offer. The BAC is a limited background check of a business, its managers and officers, and any beneficial owner of more than 20% in the business. The BAC primarily focuses on regulatory disqualification provisions, which automatically bar an issuer from raising under Regulation Crowdfunding. ChainRaise contracts with a reputable third party to conduct these checks.
ChainRaise must have a reasonable belief that an investment offering on the platform does not raise an investor protection concern or raise a risk of fraud. This does NOT mean that offerings are free of risk, only that the offering and business owners behind it appear capable of managing investor funds and are not disqualified from conducting an offering under Regulation Crowdfunding.