To say that crowdfunding is gaining momentum would be a serious understatement. According to a study commissioned by the World Bank, crowdfunding could be a $96 billion market by 2025 — larger than the venture capital industry itself.

A typical crowdfunding campaign works like this: A company posts a campaign for a fundable product or idea and users pre-purchase an item or donate to the cause in order to fund its development. Users help a company get the funding it needs and receive a reward in exchange, such as discount pricing, early release of a product, or their name listed as a backer.

But, what if you could use crowdfunding to purchase shares in a company?

That’s the idea behind equity crowdfunding, a relatively new concept where startups crowdfund their company on a crowdfunding platform in exchange for equity shares in their company. North Carolina startup Malartu, a new competitor in the space, wants to be the go-to place for new investors to get their feet wet working with startups.

Malartu is Irish Gaelic for “exchange,” and co-founder Jon Spinney said that it represents how he and co-founder Sean Steigerwald see the investment space.

“That summarizes how we feel investments should happen, especially in the early stages,” Spinney said. “We’re big advocates for democratization of investment.”

The pair met at NC State where Spinney was studying economics and entrepreneurship. At the time they were both working on their own, separate startups and began to get frustrated with the fundraising process. After meeting with a professor of theirs (and now co-founder), Lewis Sheats, they decided to create a platform to provide easier access to fundraising for startups.

They figured out that the platform they wanted to build was beyond the reach of their technical abilities, so they partnered with Raleigh’s Smashing Boxes to build the platform. Malartu was built with a custom Ruby stack.

Companies complete a due diligence process in order to raise money through Malartu. Spinney said Malartu sits down with a company for a few weeks or a month and go through the business and their corporate documents to make sure everything is in order. At the same time the company builds out their profile on the site.

Then, Malartu builds out a separate fund for the company’s financing. Spinney said they use a fund model so they can aggregate investors into one entity. This allows the company to take a single check instead of many checks, which also helps keep their capitalization tables cleaner.

Investors log in to the site to view 506 (b) and 506 (c) investment offerings, and they can also view founder videos and see the corporate documents and diligence materials for the company. Malartu is also working on multiple company funds to allow diversification for investors to invest a single amount and have it split across multiple companies.

According to Spinney, the Federal JOBS (Jumpstart our Business Startups) Act in 2012 set the stage for equity crowdfunding with legislation that allowed for investments to take place online and for investors to be able to purchase shares of a company through online portals.

Most of the platforms for equity crowdfunding, including Malartu, are targeting accredited investors only. As I wrote previously on TechRepublic, an accredited investor is someone who “has a net worth of $1 million, or they had an individual income of $200,000 each of the last two years and an expectation of the same for this year, or they and their spouse had a combined income of $300,000.”

That is the biggest challenge facing equity crowdfunding, that not all states have an exemption for unaccredited investors, and there isn’t a federal exemption either. So, unless you’re worth $1 million, you probably can’t invest.

Dan Roselli is the co-founder of Charlotte startup hub Packard Place and an advisor to Malartu. Roselli said that local congressman Patrick McHenry helped write some of the language into the JOBS act, calling it the “democratization of wealth creation.” It seemed that the goal was to open up startup investing to people who weren’t previously wealthy. While there is still a pause on non accredited investors, Roselli said, that still seems to be the long-term vision of the act.

More and more companies are trying to solicit investments through online platforms, and Spinney said that another big part of equity crowdfunding is who the startups can raise capital from.

“The Federal JOBS Act allows for general solicitation of investment,” Spinney said. “What that means is you can actually contact any individual through the internet and see if they’re interested in participating in your fundraise.”

Formerly, Regulation D 506 (b) stated that companies could not use general solicitation and that investors must be contacted by someone they already knew. It was initially put in place, Spinney said, to protect people from the “snake oil salesmen of the day.” So anyone who was fundraising would have had to know the person previously and know that they were accredited before they solicited an investment. That is not the case with equity crowdfunding.

There are bigger implications for the kind of work Malartu is doing with equity crowdfunding. Roselli said that he believes the equity crowdfunding model will level the playing field for smaller markets, such as North Carolina, and give startups in those areas better access to capital.

“Any time the rules of the game change, there’s opportunity to reshuffle the deck,” Roselli said.

Malartu recently went through their soft launch, and Spinney said they are coming up on their full launch soon. The platform successfully funded its first beta client and wants to hit its full launch with six live offerings.

If you’re interested in signing up with Malartu, you can do so here.