BrickFunding Rating Methodology

How does BrickFunding rate platforms?

BrickFunding's rating system is based on the information provided by the platforms themselves regarding their legal structure, license, fund management, operating conditions (commissions, skin in the game, buyback guarantee, etc.), number of projects and amount financed. That the platform itself provides all the necessary information is essential to generate trust and therefore an essential part of our rating system.

On the other hand, and as it could not be otherwise, in BrickFunding we believe in the power of the crowd (which is the basis of crowdfunding) and we are strong defenders of collaborative work and, therefore, crowdsourcing. If a platform performs its work correctly, it will have a large community of users that will support its good work and this will be reflected in its user base, traffic, Internet authority, its popularity and activity in social networks, as well as its qualification in other specialized portals of classification of companies and websites.

In addition, and as part of our confidence in crowdsourcing, we also take into account the opinions given to us by investors themselves through their comments on the platforms we list. Either through the reviews they leave us in BrickFunding's own website or in other portals specialized in opinions. For this reason we invite all our users to give their opinion and rate those crowdfunding platforms in which they have invested.

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Criteria used

All Crowdfunding Platforms are qualified under the same parameters and with the same evaluation algorithm. The rating of the platforms cannot be changed manually and responds exclusively to the score obtained objectively by our algorithm.

Although the BrickFunding algorithm is constantly evolving and we try to improve it by introducing small modifications periodically, we currently monitor more than fifteen parameters grouped into five categories (each worth 20% or 1 star of the total score) around which we perform the valuation of crowdfunding platforms.

  • Platform-sourcing: ★★★
    1. Licence and management of funds: 1 star
    2. Provided information: 1 star
    3. Integration: 1 star
  • Crowd-sourcing: ★★
    1. Online presence: 1 star
    2. Reviews: 1 star
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1.   Licensing and fund management

Although these two criteria are not indicative of the solvency of the platform, we do believe that they are indicative of the reliability of the platform based on the country's license and regulation.

If the platform has a license issued by the regulator of your country, it will obtain 70% of the score in this section, reducing the valuation according to whether it acts with a license from a third party, if it is in the process, or if the platform does not have a license. If the platform does not need a license to operate (because its business model does not need one and is exempt, or because crowdfunding is not yet regulated in the country), it will obtain only 17.5% of the score (1/4 of 70%). The markets and platforms that are regulated by an entity provide greater security for the investor.

Information on its operating conditions is also highly valued. In other words, if the platform converts the transactions into transactions, if it offers a repurchase guarantee. (5% of the score)

The remaining score in this section will be obtained according to how the crowdfunding platform manages the funds. (and meets the requirements for AML and KYC). Those platforms that are licensed to manage funds or work with segregated accounts managed by a licensed third party will obtain the maximum score, and the score will be reduced as the funds are managed directly by the platform in the project account or directly in the account of the platform itself that would not obtain any score.

2.   Provided information

This section includes the general information provided by the platform, description, commercial information, as well as its corporate name, legal form and year of incorporation (50% of the valuation).

Furthermore, transparency is also valued when it comes to reporting on its commissions (50% of the valuation).

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3.   Integration

In order to be able to better evaluate the performance of a platform, its track record or history of financed projects is very important, as well as the volume financed and the average profitability achieved. To this end, we make our API available to crowdfunding platforms free of charge so that they can inject information about their investment opportunities into our system.

The number of projects, the volume financed and the average profitability offered are valued equally. The score is awarded after normalizing the results according to the maximum and minimum range obtained.

4.   Online Presence

BrickFunding has agreements with different databases with which we can measure the Internet authority of a website, as well as its traffic and popularity on social networks. as well as its qualification in other specialized portals of classification of companies and websites. (Website Grader, Moz, Alexa)

In this case a fixed score is not awarded but the results are normalized according to the maximum and minimum range of each parameter. For example, the platform with the most traffic will receive the full point and the one with the least traffic will receive zero points and the rest of the platforms will receive a rating according to the established scale.

From the average of all these values the score of this section will be obtained.

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5.   Reviews

The reviews and ratings issued by registered users of BrickFunding on each platform will be taken into account.

The average of all reviews will give a score.

With all the above criteria we obtain an overall score of up to 5 points, although due to the different criteria used, no platform achieves the maximum score in all sections. With these data (which can be seen unmodified in the valuation diagram of each platform) we make a global ranking of platforms.

FAQ

    • No, the current rating system of BrickFunding is not a risk rating system and under no circumstances should it be understood as such. BrickFunding is not an Investment Services Firm and therefore we do not offer financial advice to our users.
    • At no time should this Rating be considered as an indicator of the financial stability or solvency of the rated CrowdFunding Platform, nor as an investment recommendation.
    • The BrickFunding rating system is simply an indicator that measures the performance of the rated platform based on the information provided by the platform itself and the information obtained through crowdsourcing techniques: that is, based on its Internet traffic and authority, its popularity and activity in social networks and the rating of its users.
    • The first step is to give us as much information as possible using the free tool "Platform Manager", either claiming ownership or once the platform is registered, filling in all the fields we require. In most cases a low rating is simply due to the lack of information about the platform such as its legal structure, regulation and operating conditions.
    • The second step is to integrate with the BrickFunding API so that we can have more information about your investment opportunities and be able to offer a more complete view to our users. This integration is free of charge and also represents a substantial improvement in the valuation of a platform.
    • The third step is to improve its indices and popularity on the internet and, especially, to get positive evaluations from its users on our website and in other portals specialized in reviews such as TrustPilot.
    • The most common is that we do not have enough information because the platform has not provided the information and therefore get a low score in that section due to the lack of information. Likewise, if we have not yet been able to integrate with the platform, the score referring to the number of projects financed, amount and average profitability, cannot be evaluated either and the platform will not obtain any score in that section. This is why we encourage platforms to integrate with us.
    • The second possibility is that although we have all the information, whether it is a platform recently created or very little active in social networks and therefore does not yet have traffic or domain authority. Or you simply haven't got any user to give you a good rating, so you won't get any points either. That's why we recommend platforms to encourage their users to leave opinions about them on BrickFunding.
    • Although in BrickFunding we work to be able to offer you the most complete and exhaustive list of crowdinvesting platforms, with its rating and corresponding informative card, analysis and list of investment opportunities, our current workload prevents us from adding platforms at the pace we would like. Even so, we make every effort and work continuously to expand the number of participating platforms, reaching collaboration and integration agreements in order to offer you the most accurate and truthful data from as many platforms as possible.