Fresh from closing their own funding round of $5.5 million, StartEngine has announced an update for the Elio Motors crowdfunding campaign. After receiving SEC approval for the sale of up to $25 million in November on StartEngine, the crowdfunding campaign has reached $16 million in sales. The sale was registered using the 2015 enacted Regulation A+ rules of the JOBS Act and closes on February 1st 2016. Following the sale, shares will become eligible to be listed and traded on the OTC Markets Group.
According to Elio Motors, with $16 million raised, the funding will cover their $12.6 million goal that was needed to cover expenses related to engineering and testing of their prototype E-Series vehicle. A three wheel vehicle with elements of both car and motorcycle design, Elio Motors is hoping that the E-Series will appeal to consumers due to its high gas mileage and $6800 base price cost. According to Elio Motors, 50,000 people have put down payments on the E-Series, with the firm targeting a late 2016 production launch. The announcements were part of the firm’s presentation today at the North American International Auto Show in Detroit.
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For StartEngine, the Elio Motors campaign can be viewed as a proxy to the potential of large size crowdfunding deals in the US. With the ability to raise up to $50 million in capital from non-accredited investors, Regulation A+ has the potential to compete with Series A and B funding rounds which have typically been sourced from venture capital funds.
The listing on OTC Markets will provide a secondary market for Elio Motors investors to find ongoing liquidity for their shares. If listed, the shares are expected to attract the eye of other companies and investors to view the potential of a sustainable secondary market on OTC Markets.