How does Honeycomb vet businesses?
Honeycomb has an obligation to vet all businesses before they are invited to join the Honeycomb platform.
Here are several of the key factors we review for each business who is invited to join the platform:
Financial Overview: every business that applies to Honeycomb must be able to provide 2 years of historical financials (where applicable), business taxes, a debt schedule, an ownership breakdown, and a business plan. These materials are reviewed by Honeycomb for completeness and also included within the Form C for prospective investors to review.
Business Documentation: every business must share their articles of incorporation and be verified as a business in good standing with their state.
Interview: every business must complete an interview with a Honeycomb representative and answer detailed questions about their business and capital raising objectives.
Credit Check: all owners of the business with a 20% stake or more must pass a credit check.
Background Check: the business and all owners of the business with a greater than 20% stake must successfully pass a bad actor check and background check which screens for disqualifying events, such as being convicted of, or subject to court or administrative sanctions for, securities fraud or other violations of specified laws.
Honeycomb reviews these materials carefully to ensure a business meets our high standards and has a viable path to repaying their investors.
Note: Despite Honeycomb’s careful vetting of applicants, investing in small businesses is inherently risky. When you invest in small businesses there is a risk that you may lose part or all of your principal and interest.