This, while seemingly a natural extension, is a bad idea, imho. Investing in startups is inherently one of the riskiest investments you can make, and having deals be public is a problem, as 'normal' investors will be swayed by charismatic founders into losing their homes.
That said, 'auctions' for accredited investors already exist, if the company choose to take advantage of it. There are seed funding sites as well as AngelList, etc., to publicize deals.
Some founders also choose not to publicize a raise (except among the VC/angel networks) so as to remain under the radar until they are ready to launch.
> 'normal' investors will be swayed by charismatic founders into losing their homes.
You mean their second or third homes, right? There's a minimum net-worth requirement before you're able to invest in a startup so a failed investment is not going to bankrupt any investors. The founders are much more likely to end up in the poorhouse if things don't work out than investors are.
You missed my point; I specifically mentioned accredited investors vs 'normal' investors.
I agree with you; it is a good thing that there are accreditation requirements to invest in as risky an investment as a startup. Getting rid of that would be an awful idea. That was the point of my comment.
That said, 'auctions' for accredited investors already exist, if the company choose to take advantage of it. There are seed funding sites as well as AngelList, etc., to publicize deals.
Some founders also choose not to publicize a raise (except among the VC/angel networks) so as to remain under the radar until they are ready to launch.