A crowdfunding which involves investing in an early-stage unlisted company in return for equity, i.e., shares in that company. Investors-cum-shareholders are treated as proper shareholders in terms of proportionate ownership of the capital (equity) and entitlement to profits according to each shareholder’s respective share (hence the investors are part owners). This includes financing provided by both accredited and nonaccredited investors. Crowd equity reflects the issuance of private equity-based securties to the crowd. The share offerings can be carried out only through registered broker-dealers or funding portals.

Crowd equity allows individuals to directly invest in innovative and entreprenurial startups and growing ventures.

It is also known as equity-based crowdfunding, investment crowdfunding, or crowdinvesting.