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Equity Crowdfunding in Australia

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Equity Crowdfunding in Australia

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Equity Crowdfunding is an exciting new way for high-growth businesses to seek funding from retail investors. This presentation outlines key details of the draft Australian Equity Crowdfunding regulatory framework, and what startups and investors can anticipate when it is released.

*Announced on 3 Dec 2015, the Australian Government has presented the Corporations Amendment (Crowd-sourced Funding) Bill 2015 to the House of Representatives. Much of this presentation is based of the initial draft.

Equity Crowdfunding is an exciting new way for high-growth businesses to seek funding from retail investors. This presentation outlines key details of the draft Australian Equity Crowdfunding regulatory framework, and what startups and investors can anticipate when it is released.

*Announced on 3 Dec 2015, the Australian Government has presented the Corporations Amendment (Crowd-sourced Funding) Bill 2015 to the House of Representatives. Much of this presentation is based of the initial draft.

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Equity Crowdfunding in Australia

  1. 1. EQUITY CROWDFUNDINGFULLY ALIGNED INVESTMENT HIGHLIGHTS
  2. 2. Timeline @bankrollas info@bankrolla.com 2 Mar 2002 ASIC Class Order 02/273 allows 20 retail Investors to invest via ‘Business Mathing Portal’ 1998 ASIC Class Orders reviewed for ‘Retail Investors’ Sept 2013 CAMAC’s CSEF discussion paper outlines the governments’ regulatory and legislative blueprint May 2014 CAMAC releases its findings on CSEF in Australia, recommending legislative changes Dec 2014 Department of Treasury releases its CSEF discussion paper outlining three choices; CAMAC, NZ Regulation, or Status Quo.
  3. 3. May 2015 Federal Government indicates in the Budget CSEF to be legislated in the 2015/16 financial year Dec 2015 Corporations Amendment (Crowd- sourced Funding) Bill 2015 first reading. April 2016* Bill passes both houses, later recieving Royal Assent Nov 2016* ASIC finalises Crowdfunding Platform Procedure, enabling intermediaries to apply for an ECF AFSL license Dec 2016* First Equity Crowdfunding raise is completed via an ECF AFSL licensed platform Timeline @bankrollas info@bankrolla.com 3*Estimated Timing
  4. 4. 3 Core Concepts @bankrollas info@bankrolla.com 4 Get Funded Offer Template Advertising Crowdfunding Equity … it’s a short form off-market IPO
  5. 5. It’s About The Money Australia compared to the US Equity Crowdfunding (Title III) @bankrollas info@bankrolla.com 5 USA($USD) $5,000,000 Via equity crowdfunding, suitable Australian public companies can raise up to $5m from retail investors. $1,000,000 Via equity crowdfunding, American companies are capped at $1m via equity crowdfunding laws. Australia ($AUD)
  6. 6. $ $$$ $$ $ Offer Template Protracted prospectus versus short and sweet offer document. @bankrollas info@bankrolla.com 6
  7. 7. Advertising / Soliciting Funding You know you want it. @bankrollas info@bankrolla.com 7 Investors You Friends / Family 20 Crowd / IPO 500+ Angels VC 50
  8. 8. Investor Friendly Focus @bankrollas info@bankrolla.com 8 • Investment capped at $10,000 per issuer per annum* • 5 day cooling off period (or 1 month for defective offer documents) • Minimum mandatory disclosure via standard offer document* • Liquidity, Risk and Dilution Warnings • Australian Public Company • Issuing one type of share only • Related Party Lending prohibition • Open forum (live and suspended offers) & Live offer document • Identity verification (directors, investors etc) • Upfront Fee disclosure • Australian Financial Services Licence Required for Platforms • Corporations Law Penalty Regime • 5 year sunset on issuer concessions Crowdfunding – It’s An Investment Thing Headline1 Structural2 Transparency3 Oversight4
  9. 9. Only after engaging flight mode @bankrollas info@bankrolla.com 9 Fuel Your Start-up • Affiliation • Customer / SupplierAdvocacy • Network effects / Localisation • Market awareness • Validation Why Crowd First? • Annual General Meeting Requirements • Disclosing Entity Rules • Audit (if >$1 million raised) • Paper Reporting of Financial Statements 5yr Relief for Eligible Companies • Co-Investment integration with Angel’s, VC & Industry • 5 MillionAnnual Funding Cap • Advertising Concessions • Standardised Offer Document New funding framework
  10. 10. • Facts about the company • Share structure • Financial statements • Facts about the CSF raise • Mandatory risk warnings @bankrollas info@bankrolla.com 10 AKA Pitch Deck Tailored Disclosure Document Requirements for Offers
  11. 11. WEB TWITTER FACEBOOK LINKEDIN www.bankrolla.com @bankrollas www.facebook.com/bankrollas www.linkedin.com/company/6633634 www.pinterest.com/Bankrolla/ www.instagram.com/bankrollas PINTEREST INSTAGRAM Get amongst it
  12. 12. 12 Desk by Krisada from the Noun Project Beer bottle by Raz Cohen from the Noun Project Cocktail by Okan Benn from the Noun Project Gas pump by Iris Sun from the Noun Project Group by Blake Thompson from the Noun Project Leaves by Pham Thi Dieu Linh from the Noun Project Statue of Liberty by shimaru from the Noun Project Artwork Attribution Thanks Created with care by William Neill Co-Founder Bankrolla wneill@bankrolla.com @williamneill Matthew Pinter Co-Founder Bankrolla mpinter@bankrolla.com @matthewpinter_ @bankrollas info@bankrolla.com

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