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The Deal Flags That Could Hurt Your Raise in 2025
High revenue multiples and repurchase rights are getting more scrutiny. Here's what the data shows.
Sam Fiske
May 01, 2026 • Estimated Reading Time: 3 minutes
Hi there,
This week: what’s triggering investor caution in today’s deals, April founder funding trends, and lessons from Tapouts on building engagement that sticks.
Plus: the April 30 C-AR deadline has passed — check your compliance status here; save on PurposeBuilt100 with Kingscrowd’s founder discount; and join our free webinar with Eric Ries and Alumni Ventures CEO Mike Collins here.
Let’s dive in.
A new Kingscrowd analysis shows that the “red and yellow flags” investors look for in startup deals have shifted meaningfully since 2024.
As the crowdfunding market matures, investors are becoming more selective—and more sensitive to specific risk signals in offerings. What might have been overlooked a year ago can now slow momentum or raise concerns during a raise.
For founders, this isn’t just about avoiding mistakes—it’s about understanding how investors interpret your story.
Clear communication, realistic assumptions, and strong fundamentals are becoming more critical as scrutiny increases. Campaigns that proactively address potential concerns are better positioned to build trust and convert interest into investment.
FOUNDER REPORT (Month of April 2026)
The Reg CF market raised $23.3M in net commitments in April 2026, with Wefunder ($7.0M), DealMaker Securities ($4.5M), and StartEngine ($3.7M) together accounting for 66% of all activity. Republic ($1.6M), Honeycomb ($1.4M), and Equifund ($1.3M) rounded out the top six platforms. Leading individual raises for the month included Green Coffee Company at $1.32M on DealMaker, Rentberry at $1.16M on Republic, Breath Diagnostics at $967K on Equifund, and LiquidPiston at $879K on StartEngine.
See the Report →
UPCOMING EVENT - FREE WEBINAR + WIN A COPY OF INCORRUPTIBLE BY ERIC RIES
On May 11, Kingscrowd CEO Chris Lustrino sits down with Eric Ries — author of The Lean Startup and the forthcoming Incorruptible — and Alumni Ventures CEO Mike Collins for a live conversation on what it takes to build a company that lasts — and keep it that way.
Incorruptible asks the question most startup advice skips: once you succeed, how do you stay worth believing in? How do you protect the accountability and values that got you there in the first place? If you're building right now, it's a question worth sitting with.
The webinar is free. And we're giving away two copies of the book — plus exclusive perks.
Register for the webinar, then reply to this email to let us know you signed up. For the first 50 founders who do, we'll hold a random drawing and award two winners each a complimentary copy of Incorruptible along with access to exclusive perks from Eric's team at incorruptible.co.
REG CF ISSUERS: THE APRIL 30 C-AR DEADLINE HAS PASSED
If your company raised capital under Regulation Crowdfunding, your Form C-AR annual report was due April 30.
If you haven’t filed yet, your company may now be out of compliance, which can create complications for future fundraising, platform approvals, and investor diligence.
raisepapers helps Reg CF issuers prepare and file overdue Form C-AR reports with a straightforward flat-fee service.
FROM THE INSIDE STARTUP INVESTING PODCAST
Raising capital online is hard—but keeping investors engaged is even harder.
In this week’s Inside Startup Investing, George Moringer breaks down how Tapouts turned a struggling early product into a $5M run rate business by solving one core problem: engagement.
The insight? Parents may pay—but kids decide if the product works.
By redesigning their experience around gamification, group dynamics, and retention, Tapouts built a model that scales both impact and revenue—with ~70% margins and strong repeat usage.
For founders, the takeaway is clear:
Product-market fit isn’t just about the buyer—it’s about the user.
Engagement is growth.
And iteration is everything.
Listen to the full episode for lessons on building, pivoting, and scaling a consumer-facing product that actually sticks.
EDUCATION
Reg A as a Pre-IPO Move: Turn Users Into Owners
If you’re a consumer brand eyeing an IPO, here’s a counterintuitive idea: use Regulation A first. CrowdCheck’s Andrew Stephenson argues that IPO allocations skew institutional—while Reg A can invite retail investors earlier, giving you more flexibility to communicate with customers and convert them into long-term stakeholders before you go public.
