What is StartEngine?

If you have spent any time looking at startup investing, you have seen StartEngine. It runs the ads, it has Kevin O’Leary as a strategic advisor, and it is the platform most retail investors meet first. Teshy tracks it alongside tZERO, Republic, Wefunder, Realio, NetCapital and Securitize because it is one of the few places ordinary investors can buy into private companies at all.

But StartEngine in 2026 is not the company its marketing describes. The retail crowdfunding business that made its name is now a minority of its revenue. The growth story that carried it to a $2 billion valuation stalled six months ago. And the valuation itself is set by StartEngine, not by an outside investor. None of that makes it a bad platform — it makes it a platform worth understanding properly before you put money in, either into a deal it hosts or into StartEngine itself.

What StartEngine actually is

StartEngine launched in May 2016 and is run by co-founder and CEO Howard Marks — the Activision co-founder, not the Oaktree Capital investor of the same name. Its regulated core is StartEngine Primary LLC, a FINRA-member broker-dealer, which makes StartEngine the largest single-platform broker-dealer in U.S. Regulation Crowdfunding by capital deployed.

The headline numbers it cites for itself: 2.1 million+ users and $1.5 billion invested to date, a figure that includes the book it absorbed when it acquired rival platform SeedInvest. It has funded 6,375 companies since launch.

The four businesses

“Equity crowdfunding platform” undersells what StartEngine now runs. There are four distinct lines, and they have very different economics.

Around those sit the service businesses: transfer agent work and cap-table management (roughly $250–350 per company per month), plus a widening push into other alternative assets — in March 2026 StartEngine acquired Vinovest, a fine wine and whisky investment platform, for $14 million.

The track record: what happened to the 6,375 companies

This is where prospective investors should spend their attention, and where platform marketing is least helpful. Per KingsCrowd’s exits-and-failures data, of the companies funded on StartEngine:

• 77 have produced a liquidity event — 21 IPOs, 49 acquisitions, and 7 company buybacks. That is a 1.2% exit rate.
• 6.4% have failed outright.
• The remaining ~92% sit in what KingsCrowd calls the “quiet middle” — not dead, not liquid, and paying nothing.

The most-cited success is Knightscope (Nasdaq: KSCP), the security-robotics company that listed in January 2022 at a $535 million valuation. It is a genuine win — and it took more than seven years from its first StartEngine listing to get there. That timeline, not the headline, is the realistic one.

Deal sizes are correspondingly modest. The median Reg CF raise on the platform is about $194,000 for equity deals and $59,000 for debt, drawing an average of 285 investors (median 91). These are small, early, illiquid bets, and the distribution of outcomes is exactly what that implies.

Market position

StartEngine is not the volume leader in its founding category. Its Reg CF market share slipped from 24% in 2024 to roughly 22% in 2025, and on 2025 Reg CF volume it ranked second at $89 million, behind Wefunder’s $109 million. Where StartEngine has pulled clearly ahead is total capital raised across all regulations — driven by its stronger Reg A+ book and, above all, by StartEngine Private.

The secondary market: how liquid is it really?

Secondary liquidity is the thing that would make retail private-market investing genuinely work, and it is the reason we pay attention to tZERO’s ATS as well. StartEngine Secondary is a real, SEC-registered ATS with more than 6,000 securities quoted on it. It is also considerably less liquid than that number suggests.

StartEngine’s own equity: the $2 billion question

StartEngine sells shares in itself, repeatedly, through Reg A+ offerings on its own platform. That makes it unusual and interesting — and it means the company’s own numbers are public. It files with the SEC as a full reporting company, and its stock trades under the ticker STGC.

The financials

2025 was a genuine breakout year. Revenue more than doubled and the company turned its first GAAP profit in nine years of operating. Then 2026 happened.

Read the right-hand column carefully. In the first half of 2026, revenue went backwards — $69.3 million against $70.2 million a year earlier. Gross profit fell by roughly $3.5 million while operating expenses rose by roughly $2.7 million, putting operating costs above gross profit. Q1 2026 alone swung to a $2.23 million net loss, against a $1.72 million profit in Q1 2025. The single profitable year in company history currently looks like a peak rather than an inflection.

How the valuation is set

In June 2025, StartEngine closed a Reg A+ raise of $10.33 million, selling 9,347,504 shares at roughly $1.10 each, at a stated valuation near $1.38 billion. In June 2026 it filed to raise up to $45.6 million at $1.60 per share, at a stated valuation of around $2 billion — with up to 20% bonus shares, a $500.80 minimum, and 30% of gross proceeds going to selling stockholders rather than the company.

Here is the part worth doing the arithmetic on yourself. Both figures imply roughly the same share count — about 1.25 billion shares outstanding (our arithmetic: $2 billion ÷ $1.60, and $1.38 billion ÷ ~$1.10). The valuation is simply the share price multiplied by the share count. And in a Reg A+ self-offering, the share price is set by the issuer. No outside investor negotiated $1.60. StartEngine raised its own price ~45% year over year, in the same period its revenue stopped growing.

Two more details belong in the same frame. StartEngine paid for Vinovest in its own stock — 8,750,000 shares valued at $1.60 each — so the self-set price is also the currency it acquires with. And STGC shares trade on the OTC Grey Market, the thinnest tier of over-the-counter trading, with no market makers quoting it. The $2 billion is a number in an offering circular, not a price discovered by buyers and sellers.

For scale: Wefunder, which out-raised StartEngine on Reg CF volume in 2025, last raised a community round in 2023 at an implied valuation of roughly $175 million, and reported $16.8 million of revenue with $2 million of net profit in 2024. StartEngine has far more revenue. It also carries a valuation more than ten times its competitor’s on a business that just posted a flat, loss-making half-year.

What this means if you invest through StartEngine

StartEngine is a legitimate, regulated, genuinely useful piece of market infrastructure. It is also a company in the middle of a strategic pivot, selling its own stock to the retail audience its pivot is moving away from. Both things are true, and holding them together is the whole job.

Three practical takeaways:

• Judge each deal, not the platform. A StartEngine listing is distribution, not diligence. The 1.2% exit rate and 92% quiet middle are the base rates you are betting against.
• Assume illiquidity. Secondary exists and is real, but with an 8.5% round trip, 30+ day settlement, no market makers and no guaranteed execution, treat every position as money you cannot retrieve on demand.
• Apply the same reading to StartEngine itself. Find the share count behind the valuation, check whether anyone independent set the price, and read the most recent quarter rather than the best year.

That last habit is the one that generalises. It is the same test we applied to tZERO’s TZROP token, whose famous 10%-of-revenue dividend turned out never to have been paid: read the filings, not the marketing. Whether the wrapper is a security token, a Reg A share, or an SPV interest, the questions do not change — what do I actually own, who set the price, and how do I ever get out? If you are new to the regulatory alphabet behind these raises, start with our explainer on Reg CF, Reg A+ and Reg D.