Wall & Main is a
venture capital crowdfunding firm attempting to use crowdfunding to raise its own initial capital. For a firm that is supposedly all about facilitating investments, their fundraising efforts leave me scratching my head. First the good news:
MilePoint negotiated a special offer for its members who buy one of Wall & Main’s crowdfunding packages by 10 PM (Pacific Time) today. All purchases by MilePoint members will include Bose QC-15 noise canceling headphones ($300 value). In addition, the first 300 purchases will include elite status with United’s MileagePlus program.
- Platinum package includes MileagePlus Premier Platinum status
- Gold package includes MileagePlus Premier Gold status
- Silver or Bronze package includes MileagePlus Silver status
I value Silver status at about $100. Most of its elite benefits can be replicated with a credit card annual fee. I admit I have not spent much time considering the value of Gold or Platinum status, but I will throw out ballpark figures of $500 and $1,000, respectively. The larger baggage benefit, free lounge access on international itineraries, and waived award booking/change fees (Platinum members) are the primary benefits. Domestic upgrades will still be tough for Gold members on most flights. I value Premier 1K status, which is not being offered, at about $2,000.
The problem is that these benefits are still too low to compensate for the high price that Wall & Main charges for United’s MileagePlus miles. The promotional benefits are worth roughly 3-10% of the total value of today’s offers:
- Platinum package: 1,000,000 miles for $30,000
- Gold package: 500,000 miles for $15,000
- Silver package: 250,000 miles for $7,500
- Bronze package: 150,000 miles for $4,500
It doesn’t really matter if these are lower prices than United normally charges. They are all still 3 CPM, which is awfully high for redeemable miles. I value my miles at 2 CPM, and I will consider buying them at a price below 1.5 CPM. If you use manufactured spend, it’s possible to earn them at a price below 0.6 CPM.
Despite the “crowdfunding” veneer, you shouldn’t think of this as anything but a typical offer to buy miles or points. Others have taken issue with the fact that Wall & Main and some of its supporters have been using the words like “investors” to describe its customers. So to repeat, you are not “investing” in anything, just buying a product at an inflated price that United can devalue without notice at any time.
I know not everyone has time to do mileage runs, but for comparison, the benefits of those are (1) still earning miles at a lower price than this offer, (2) also earning elite status just like with this special offer, (3) actually visiting a destination on the paid trip in addition to the destination you visit on the award trip. If I’m not willing to do mileage runs at 3 CPM — actually 6 cents per flown mile because of my 100% elite bonus — then I’m certainly not going to buy miles and get less for the same price. Maybe if they included lifetime qualifying miles in the same package…
I don’t see any reason to purchase the Wall & Main crowdfunding packages unless you really need a lot of United miles. If so, buy your miles today just so you don’t pass up on the bonus, but don’t buy it because of the bonus. In fact, United just announced its own promotion today (targeted by email) charging as little as 2.6 CPM for up to 100,000 miles.