Frequently Asked Questions

NAVIGATION MENU


WHAT IS BIOVERGE

Bioverge is an online investment platform where you can invest in highly vetted healthcare startups. We are open to everyone (accredited and non-accredited alike) and dedicated to healthcare.

For investors, simply sign up, create a profile, search by disease, technology, or geography, review relevant companies, and invest and engage via the click of a button.

For companies, apply for streamlined access to capital and ongoing support from an extended healthcare-focused Network.

WHY BIOVERGE

We believe in doing good. We offer everyone the opportunity to invest in and support healthcare startups dedicated to changing the world.

  • Access

    • Investing in startups used to be the exclusive domain of venture capitalists and well-connected individuals, but those days are gone thanks to the American JOBS Act. Now, under Title III everyone can invest in startups.

  • Curation

    • Every startup must pass our extensive selection process, detailed here.

  • Impact

    • Invest in and help support companies that are pushing the boundaries of human healthcare and tackling diseases that affect us all!
FOR COMPANIES:
  • Simplify

    • Let us help you streamline your fundraising. We have the tools and resources to help you run a successful campaign with minimal distractions from what you should be doing…running your business!

  • Accelerate

    • Raising capital is never easy, but we can help you accelerate your fundraising timeline by harnessing the collective interests of the crowd.

  • Amplify

    • Our platform acts as force multiplier helping you leverage the funds you’ve raised offline.

  • Focus

    • Our healthcare focus ensures you reach the most relevant investors and have a cohesive and specialized network to support you as you grow and scale your business.
  • Network

    • Opportunities to engage with emerging healthcare technology companies in various capacities, including: assessment, advisory, consulting, mentoring, beta-testing, etc.

  • Informed

    • Keep up-to-date on the latest companies, trends, and technologies in healthcare

  • Impact

    • Leverage your expertise to support new high-impact technologies at their earliest stages
HOW DO YOU SELECT WHICH STARTUPS TO LIST?

We are a curated platform. All startups must apply and undergo a screening process before being listed. Most startups listed on the platform are referred to us by a partner in our network, however, startups can also apply to be listed without a referral.

Our typical selection process consists of the following steps:

  • Online application
  • Team interview
  • Preliminary diligence
  • Bioverge Diligence
WHAT IS THE BIOVERGE SHOWCASE?

The Bioverge Showcase program was designed to enable pre-seed companies to begin building followers and engaging with the Bioverge Network. To learn more about this program, please contact us at info@bioverge.com.

WHAT IS THE BIOVERGE DILIGENCE PROCESS?

During Bioverge Diligence, we combine our independent review with the input of various sources, including our network of scientific and technical subject matter experts, industry veterans, and professional investors to evaluate each opportunity from a number of unique and specialized perspectives. We fundamentally believe that the combined power of the Network is much greater than the power of the individual. Further, not many individuals have the time, expertise, or network to undertake this effort by themselves.

Bioverge Portal, LLC is a funding portal that operates under Regulation Crowdfunding (“Reg CF”), a law that became effective in May 2016 under the American JOBS Act.

Reg CF allows companies to raise funds by offering securities to all investors, accredited and non-accredited investors alike (subject to dollar amount limitations).

FOR INVESTORS
WHAT DO I GET WHEN I INVEST?

When you invest on Bioverge you receive a financial stake in the company. Most startups on Bioverge prefer to use a security called the Crowd Safe.

Bioverge support extends far beyond the campaign. When you invest, you are joining the founders on their journey and you’re gaining a chance to help be part of any future success they might enjoy.

Contrary to popular belief, the success of a startup is not pre-ordained! At Bioverge, we are cultivating an ecosystem to support founders on their journey to build and grow their companies. We do this not merely for the potential financial return, but because we remember that every founder we support is working to serve the patient…an experience we will all have at some point in our lives.

The Crowd Safe is a version of the SAFE (Simple Agreement for Future Equity), a standardized contract widely used by angels and VCs who invest in startups, designed specifically for equity crowdfunding.

WHAT DO I GET IN RETURN FOR MY CROWD SAFE INVESTMENT?

When you invest with a Crowd Safe, you become a company investor, but are not yet a shareholder of company equity. The instrument gives the company some flexibility in deciding when and if to convert the Crowd Safe investments into company equity.

For example, in the event of a future equity financing, the company may elect to either (a) convert Crowd Safe investments into preferred equity or (2) “roll-over” Crowd Safe holders and continue the terms of the Crowd Safe. The instrument was designed in this way to avoid the messy situation where a large number of crowdfunding investors automatically appear on the company’s capitalization table. The Crowd Safe also clarifies that converted equity shares will not include voting rights or comprehensive information rights. These two provisions are especially important to early stage companies and later professional investors to prevent disseminating control too widely amongst individuals for future strategic decisions.

Since the document includes fixed conversion terms, you will always receive the same economic outcome (regardless of whether the company elects to convert) if and when there is a liquidity event.

To incentivize investor participation, companies often include a “valuation cap” or “conversion discount” (or both) in the Crowd Safe.

A conversion discount provision gives an investor a minimum discount to the valuation in a future round of financing. Following a financing event (as specified in the Crowd Safe), investor funds will convert at the discounted valuation.

As alluded to earlier, these as-converted investment values will be maintained regardless of whether the company elects to convert your Crowd Safe into company shares at the time of the financing or elects to extend the term of the Crowd Safe.

HOW MUCH CAN I INVEST IN A REGULATION CROWDFUNDING OFFERINGS?

You are restricted to investing a certain amount in any 12-month period depending on a combination of your net worth (less the value of your primary residence if you own a home) and your annual income.

Note: you don't have to make these calculations yourself! Your limit is automatically calculated when you register on our platform and confirmed prior to making an investment.

If either your annual income or your net worth is less than $107,000, you can invest up to the greater of either:

  • $2,200, or
  • 5% of the lesser of your annual income or net worth during any 12-month period.

If both your annual income and your net worth are equal to or more than $107,000 then you can invest:

  • up to 10% of your annual income, or
  • up to 10% of your net worth, whichever is lesser up to a maximum of $107,000 during any 12-month period.

Remember, this is your limit for all Title III investments, not just those with Bioverge! Here are a few examples, courtesy of an SEC Investor Bulletin:

Annual Income Net Worth Calculation 12-month Limit
$30,000 $105,000 greater of $2,200 or 5% of $30,000 ($1,500) $2,200
$150,000 $80,000 greater of $2,200 or 5% of $80,000 ($4,000) $4,000
$150,000 $107,000 10% of $107,000 ($10,000) $10,700
$200,000 $900,000 10% of $200,000 ($20,000) $20,000
$1.2 million $2 million 10% of $1.2 million ($120,000), subject to cap $107,000
HOW DO I EARN A RETURN?

Of course, when investing in something as risky as a startup, there may be no return at all.

That being said, should a company’s value rise over time, your investment is also likely to accrue value on paper. It is important to realize that Crowd Safes and preferred equity shares are not easily traded or sold, and that investors may lose some or all of their investment in Crowd Safes or preferred equity securities. Generally, you will not receive a liquid return unless the company experiences a liquidity event, such as (a) going public or (b) getting acquired by another company.

In the event of a liquidity event during the term of the Crowd Safe, you may elect to have your cash returned or to convert the Crowd Safe into company stock based on the purchase price and market value of the shares at the company’s first equity financing event.

Please note that there is no guarantee that any of these events occur; if no subsequent equity financing or liquidity event occurs, the Crowd Safe will not convert and therefore produce no return. Should the company experience a dissolution event during the term of the Crowd Safe, the company is obligated to utilize all assets legally available for distribution to settle its debts. These funds will be allocated with equal priority among Crowd Safe investors and debt holders before transitioning to preferred equity shareholders. However, funds may be inadequate to make investors whole, and therefore, investors may lose some or all of their investment.

CAN I SELL MY REGULATION CROWDFUNDING INVESTMENT?

Investments in private companies are illiquid and cannot be easily sold. You will be restricted from selling your investment for a one year period following closing, unless your securities are transferred pursuant to the narrow exceptions set forth in Reg. CF Rule 501(a)(1)-(4).

It is important that you acknowledge the indefinite holding period and real risk of total loss of your investment when investing capital. Only invest what you can afford to lose.

ARE THERE RESTRICTIONS ON THE TYPE OF COMPANIES LISTED ON BIOVERGE?

Yes. We are a highly curated platform dedicated to companies within the healthcare space. We are focused on solving humanity’s biggest challenges within healthcare. As such, we fund a wide variety of technology types, however, the overarching theme is the convergence of biology and technology.

In order to be considered for listing on the platform, we are looking for companies that embody this convergence and have secured funding from a professional third party, which can include an: accelerator/incubator, VC, strategic partner, professional angel group, or federal agency.

HOW MUCH CAN I RAISE?

Under Regulation Crowdfunding, the SEC limits companies to raising $1,070,000 via Title III per rolling 12-month period.

HOW LONG WILL IT TAKE TO RAISE FUNDS?

Campaigns (start → finish) typically last 30-90 days, however, we do what we can to customize the length of a campaign to best fit your needs. Please contact us to learn more at info@bioverge.com.

WHAT FEES DO YOU CHARGE?

If you reach your funding goal you pay 6% of the total funds raised in cash and 2% to Bioverge in equity coverage (via Crowd Safe).

You are also responsible for covering transaction related expenses, which include things like escrow agent fees and completing a Form C. Companies typically use proceeds from their successful offering to cover these transaction-related expenses.

These fees are typically less than $10,000. Here are a few estimates of what you should expect:

  • Form C: $1,500
  • Escrow: $1,500
  • Financials: $1,000-$5,000
  • Marketing materials (video, social media, etc.): Recommended, but 100% optional

Note none of the transaction-related fees are paid to Bioverge.

Example: NewCo, Inc. hits its funding goal and successfully raises $100,000 at a $10 million valuation, effectively selling 1% of its equity in the offering ($100,000 / $10.1M = 1%). You would pay Bioverge $6,000 in cash and a $2,000 Crowd Safe. In addition, you would owe transaction-related expenses which may be ~$10,000, depending on the type of third-party services you selected.

CAN COMPANIES OUTSIDE THE U.S. RAISE MONEY?

No, only companies based in the U.S. can raise via Regulation Crowdfunding per federal law. If you are based outside the U.S. there are opportunities to raise capital from accredited investors using our Regulation D offerings.

Please contact us to learn more at info@bioverge.com.

WHAT ARE THE REGULATION CROWDFUNDING COMPLIANCE REQUIREMENTS?

Form C

Prior to launching a campaign, you will need to submit a Form C to the SEC. A majority of the fields are going to be information that is likely to be readily available. The Form C will ask you to disclose certain information which can help people understand the investment and that will help determine whether an investment in your company is appropriate for a specific person.

This includes general information about your company, its officers and directors, a description of the business, the planned use for the money raised from the offering (i.e. use of proceeds), the target offering amount, the deadline for the offering, related-party transactions, risks specific to your company or business, and financial information.

Bioverge will provide support throughout to smooth the process and ensure compliance. Learn more about the required disclosures here

HOW DO YOU HANDLE CONFIDENTIAL INFORMATION?

We have tiered access levels that allow you to manage who sees your information. All members on the Bioverge platform will have access to your basic company profile, however, you can restrict access to sensitive material such as your investor presentation and any diligence material to investors that you approve.

We will work closely with you on managing access to restricted information. Some companies prefer to manage the access of each individual investor, while other companies happily defer to us to manage the process.

Regulation Crowdfunding Annual Filing Obligations

If you successfully complete an offering, you will need to file a Form C-AR (Annual Report) and financial statements annually with the SEC. The Form C-AR contains updated disclosure similar what you provided in your initial Form C. Note: while the Form C-AR will be required at least once, there are a number of conditions that could discontinue this requirement in subsequent years.

The Bioverge website also hosts Reg D offerings through its subsidiary Bioverge Funds Management LLC. For more information about these offerings, go here