TALKS PRACTICALLY ABOUT WHAT THEY LOOK FOR AND HOW THEY CAN SUPPORT A BUSINESS WANTING TO BE INVOLVED IN CROWDFUNDING
Anna is one of the pioneers in building New Zealand’s crowdfunding industry. She is passionate about its ability to create faster, easier and more transparent investment rounds, making more companies accessible to more investors.
What are you looking for in a company?
We’ll help any company that has a crowd. We’ll coach them through that process, helping identify their crowd and whether or not they should do a first round with family and friends or extend to their customers and networks.
It’s important they understand the implications for them and their existing shareholders. We’ll provide information and support to help them decide whether crowdfunding is the right channel. Companies need to be ready for crowdfunding campaigns, ideally with a good social media presence, communication skills in house, and enough time to adequately manage the campaign. In terms of what is or isn’t a good project or campaign, ultimately the crowd decides, though of course we won’t take anything that is illegal.
What do companies need to do?
They need to deliver the basic requirements of company information, financial statements and forecasts, a business plan, valuation and a signed issuer agreement. We’ll run background checks to make sure the company and directors haven’t done anything that could be seen as fraudulent in their past, which is the request process.
They need to set a minimum goal of what they want to raise for the round and define an equity/stake on offer share price with a maximum amount they could overfund. Generally offers are between 10%-20% of the total shareholding.
Investors have to register before pledging to acknowledge the risk of investing in start-ups then we verify the identities of investors before the raise is completed.
What support do you provide?
We draw on our deep knowledge of crowdfunding and what motivates the crowd to coach companies through the full process. As well as a focus on not just helping companies ahead of and during the fund raising phase, we are focused on ensuring our platform continues to help them stay afterwards. A big part of that is making it as easy as possible for them to continually communicate with their shareholders – including voting on resolutions - and educate them on what a direct relationship means.We’ll provide all the information on regulatory requirements though we do not advise at that level. Companies should certainly consult with their lawyers and accountants at this level.
What about exit strategies?
It is up to the company to talk about their exit plan in the campaign such as whether they plan to hold onto the company or pay dividends to investors. In the future, we are looking to provide a facility for secondary markets on the platform where investors can buy/sell shares, but in the meantime, companies can look to facilitate that process themselves.