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Crowdfunding

What is Crowdfunding?

Crowdfunding is the raising of funds through the collection of small contributions from the general public (known as the crowd) using the Internet and social media.

Crowdfunding has its origins in the concept of crowdsourcing, which is the broader concept of an individual reaching a goal by receiving and leveraging small contributions from many parties.

CBC’s the current – Kickstarter meets Bay Street: Selling shares through crowdfunding

Online pleas to crowdfund money comes from thousands looking to make a film or start a business. Now, seven Canadian securities commissions want to take that idea, to let companies sell shares to potential investors through crowdfunding portals. Read the full article here.

Crowdfunding Webinar: Global Trends and Outlook in 2014

Webinar Format:  Moderated panel discussion

Webinar Recap

Ever since the Jobs Act was announced in 2010, equity crowdfunding has gained interest from all industries – so much in fact that “crowdfunding” searches on Google recently outnumbered that of “venture capital”. We’ve seen the success of well-known campaigns such as the Pebble Watch and the economic benefits in terms of GDP; however, where is this exciting movement/industry/trend heading? NCFA Canada and special guests: Daryl Hatton Christopher CharlesworthAlixe Cormick, Myles Harding, and Lyn Blanchard, CMC as we discussed growing trends and the future outlook for global crowdfunding in 2014, including topics such as:

How is crowdfunding disrupting traditional sources of funding in industries including venture capital, social enterprise and government?

  • How have technological trends such as social media, mobile, and cloud computing impacted the growth of crowdfunding? (i.e. FundRazr’s cFaaST Technology)
  • The evolution of debt and equity crowdfunding in the US, including title II and title III models
  • Emerging equity crowdfunding regulations in Canada and future outlook

 

National Crowdfunding Association

 

Craig Asano is the Founder and Executive Director of the National Crowdfunding Association of Canada, a newly formed non-profit that is Canada’s dynamic and inclusive Crowdfunding advocate.

NCFA Canada works closely with industry partners, technology platforms, academia, affiliate groups and business associations to create a strong and vibrant crowdfunding industry and voice across Canada.

Founder and Executive Director – Craig Asano

Craig Asano – LinkedIn Profile

Myles Harding (President of Inline Reference Check) Joins National Crowdfunding Association of Canada Advisory Board

Myles Harding – LinkedIn Profile

Canadian Small Businesses Eagerly Await Crowdfunding Regulation

For cash-strapped small businesses, a new funding option in the works could mean a substantial and dramatic improvement for their access to capital.

Crowdfunding, more typically a platform for raising donations, is now letting business owners offer investors a stake in their companies in exchange for capital.

The contentious solution is being hotly debated between small business owners, industry advocates, and securities regulators.

Equity crowdfunding is a boon for new startups that don’t have the size or structure to raise money by going public with an initial public offering, advocates argue. Critics warn of the risks: Investors may end up with illiquid assets, negative returns or unsuitable investments for their risk profile.

Read the full article here.

 

2015 Canadian Crowdfunding Summit

Canadian Crowdfunding Summit

The inaugural 2015 Canadian Crowdfunding Summit will be held on Tuesday, March 3, 2015 at MaRS Discovery District. The Summit is the foremost event for leaders in the Canadian crowdfunding space. (Read more)

Why Crowdfunding Background Checks are Important: 

Know the people who you are investing in!

Inline Reference Check offers comprehensive due diligence for crowdfunding.

Inline Reference Check is working with industry leaders in an effort to to standardize a best practices protocol to mitigate risks on both sides of the investment table – for advisers and funding organizations, SMEs and start-ups.

Crowdfunding Preparation

Start-up due-diligence success requires work in advance. Learn more in this AlleyWatch article.

 Inline Reference Check

The Importance of Crowdfunding Background Checks (White Paper):

The numbers are still small in comparison to more traditional forms of financing, but it is apparent that as crowdfunding goes mainstream it will increasingly attract the attention of financial regulators. Equity crowdfunding has recently received attention from policy makers in the United States and is being closely scrutinized in Canada. Read the full article here.

Equity Crowdfunding Regulations in Canada:

Ontario:

The OSC in a news release indicated it will be adopting the new crowdfunding rules as early as practical in 2015.

“The [existing security holder] exemption represents one of four new, potential capital raising tools, which were published for comment by the OSC in March 2014. Three exemptions – a family, friends and business associates prospectus exemption; an offering memorandum prospectus exemption; and a crowdfunding prospectus exemption together with a registration regime for online funding portals – remain under consideration.

Read the full article here.

Saskatchewan:

As of December 2013, Saskatchewan has implemented a crowdfunding prospectus exemption. As of yet, no equity crowdfunding portals have been launched.

Equity Crowdfunding Regulations in the United States:

United States:

The Jobs Act was signed into law in April 2012, which has given the SEC (Securities Exchange Commission) 270 days to set specific rules and guidelines that enact this legislation, while also ensuring the protection of investors.

The legislation mandates that funding portals must register with the SEC as well as an applicable self-regulatory organization to operate.

An issuer may sell up to $1,000,000 of its securities per 12 months.Investors will be permitted to invest up to $100,000 in crowdfunding issues per 12 months.

An independent financial statement review by a CPA firm is required for raises $100,000 – $500,000, and an independent financial statement audit by a CPA firm is required for raises over $500,000.

For more information on key stakeholder verification, click HERE.

Equity Crowdfunding FAQ

The NCFA’s frequently asked questions, for individuals that are new to Equity Crowdfunding as well as seasoned veterans.