Category Archives: NCFA Blog

Ontario government invests in fintech to boost small-business lending


The Globe and Mail | Clare O'hare | May 2, 2018

The Ontario government is turning to Canada’s financial technology sector to help small businesses get better access to financing.

On Wednesday, Lending Loop, a peer-to-peer online lending platform for small-business loans, announced a pilot project in partnership with Ontario that will provide $3-million of loans over the next two years. The government will boost Lending Loop’s loans by 10 per cent, which will help fund more than $30-million of loans to businesses across Ontario. The government will receive a full re-payment of the loan plus interest at the end of the loan terms.

“This pilot program is important as it will significantly benefit small businesses, accelerate Fintech adoption, and provide new opportunities for financial institutions,” Jeff Leal, Minister Responsible for Small Business, said in a statement.

Small-business loans are seen as risky, with borrowers facing annual interest rates between 8 per cent to 40 per cent as a result of challenges such as absence of collateral, a lack of operating and credit history, unaudited financial information or an absence of steady cash inflows.

“The new lending commitment from the province recognizes the contribution that non-traditional channels can play in improving businesses’ access to capital,” says Cato Pastoll, co-founder and CEO of Lending Loop. “This partnership is a major step forward for peer-to-peer lending in Canada. Globally, over $40-billion has been lent to businesses through the peer-to-peer model, and we are incredibly excited to see the Ontario government involved in helping support the growth of businesses across the province.”

In Canada, there are a handful of online lenders offering small-business loans. The majority of the platforms are fintech start-ups that have been looking to address challenges many small businesses face when accessing financing from traditional sources – such as Canada’s five big banks.

As part of Ontario’s strategy to support small businesses, the 2017 Fall Economic Statement included a commitment to establish a pilot project to address small-business financing challenges.

In early 2018, the ministry held a number of consultations with representatives of lending platforms, credit unions and large financial institutions to determine the best approach. The government found that many businesses struggle when it comes to securing loans between $500,000 and $1-million.

See:  Lending Loop launches “Auto-Lend” after raising new round of funding

“Peer-to-peer lending platforms play an important role because they increase the amount of capital for small businesses by creating new sources of loan capital, more sophisticated credit models, and efficient access,” said a spokesperson for Mr. Leal’s office. “Platforms in other markets have proven that lending to small businesses with affordable, long-term capital not only benefits the small businesses but is also a highly attractive investment for investors.”

The three-year “access to capital” pilot program also includes a commitment to provide a grant of up to $750,000 to the Toronto Financial Services Alliance to promote awareness of alternative forms and sources of lending programs available to small businesses.

Continue to the full article --> here


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders across the country. NCFA Canada provides education, research, industry stewardship, and networking opportunities to over 1600+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry in Canada.  For more information, please visit:


NCFA Canada’s response to BCSC Notice 2018/1 ‘Consulting on the Securities Law Framework for Fintech Regulation’


NCFA Canada - Join Today | Robin Ford | April 3, 2018

The NCFA is a national non-profit organization engaged with both social and investment crowdfunding and fintech stakeholders across the country. It provides education, research, leadership, support, networking opportunities and services to over 1600 members and works with the private sector, government, academia, and community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry in Canada. The NCFA supports ‘innovation finance’ - aiming to make the financial ecosystem more accessible and inclusive and to enhance the use of technology for smarter, faster, and more secure decisions and services.

Thank you for the opportunity to comment. We appreciate the active steps that BCSC is taking to better understand a fast moving ecosystem and to adapt accordingly.  The NCFA provided both oral and written input on many of the issues below to the BCSC in 2017. Except in response to the questions posed by the BCSC, the NCFA does not repeat those submissions here.

Consultation questions and responses

1 (a) Although we are limited by a serious absence of data in Canada, the limited data we do have, supplemented by anecdotal evidence from our members, supports our assertion that moving to a lifetime raise of $1 million would increase the effectiveness of the start-up crowdfunding exemption. The $250k cap per 6 month subscription is unduly limiting for most types of businesses that could rely on the exemption.

However, we have argued previously for no caps (or at least a higher limit of $5 million over the fund-raising lifetime but ideally possible in one financing). This would be more in line with other (successful) jurisdictions. In the UK, for example, there is no cap on the total amount an issuer can raise in any given year and no limit on the amount an in- vestor can invest - in-the-uk-but-what-about-the-us. Assuming other appropriate requirements (such as for disclosure and KYC), there is no significant risk to consumer protection of which we are aware that should prevent this.

We wonder how the higher cap is working in Alberta?

(b) The BCSC will know from our earlier submissions that the NCFA is strongly in favour of removing the requirement for “eligible securities” or expanding the definition to allow for eg convertible securities.

(c) We continue to propose other changes to the crowdfunding exemptions across Canada. We argue that many restrictions are not justified by the risks. Their only effect is to restrict or prevent start-ups in Canada. (To the extent that the BCSC continues to be of the view that those prescriptive requirements are justified by the risks, we ask that the analysis be made public so that we can more effectively respond.)

Our main recommendations for regulatory change across Canada remain:

  • harmonize crowdfunding/start-up requirements across Canada
  • permit advertising and general solicitation (or make it easier)
  • increase the threshold for required review or audited financial statements
  • allow accredited investors to fully participate (without caps)
  • eliminate retail investor caps (or at least increase them)
  • provide a reasonable sunset clause for audited financial statements
  • increase the period for filing of the distribution reports.


Online lending

Although the staff of securities regulators in Canada, including the BCSC, have supported the development of peer to peer (P2P) lending platforms such as Lending Loop, there are fundamental aspects of the securities regime that are not well suited to regulating what is in substance a loan brokerage activity linking lenders (investors) with small and medium sized business (SME) borrowers under a simple loan agreement.

We call for the establishment of a regulatory regime that recognizes and accepts that the activities of P2P lenders (and simple loan agreements) are inherently different from equity investments and should be regulated differently.

We ask that CSA examine and adopt the regulatory models in other jurisdictions such as the UK and New Zealand where frameworks were developed specifically for P2P lending (see Secu- rities regulators should exempt P2P lenders from securities legislation on the condition that they comply with provisions designed for P2P lenders.

A new regulatory paradigm should improve a lower rate of adoption in Canada than seen in other jurisdictions where P2P and B2B have provided significant economic stimulus by supporting the growth of the SME sector.


2. The BCSC asks whether it should make changes to the regime that would increase differences with other jurisdictions.

Since the changes would (presumably) reduce burden, the answer has to be, in principle, yes. The benefit should outweigh the cost (if any).


3. What is the likely impact of ICOs on existing crowdfunding opportunities?

There are similarities and differences between traditional crowdfunding and ICOs in terms of mod- els, regulations, ownership, usage, and liquidity to name but a few. However, they both seek to use technology to raise early stage capital for new products/services and ven- tures while allowing a wider pool of investors to participate.

We view ICOs and tokens as the next generation of crowdfunding using DLT and de- centralized models that improve liquidity and contract reliability in ways that traditional crowdfunding platforms cannot achieve. For example, ICOs can reduce or eliminate the need for transactions to be verified by third parties via decentralized networks that are in a way self-regulating. Blockchain allows smart contracts/tokenization that can automate and execute pre-agreed conditions once they are met.

All stakeholders are assessing ICOs and the risks associated with them in a rapidly evolving market that has unfortunately also attracted the interest of many speculators whose primary concern is not necessarily compliance or honest behaviour. This has not been a major concern with traditional crowdfunding. Nevertheless we are seeing the emergence of best practices from KYC and AML processes to governance and trans- parency standards. We expect this trend to continue. See the recent ICO best practice document from the Hong Kong FinTech Association.

On the one hand we urge regulators not to over-react to risks of financial crime and poor operating behaviour by ICOs (but to deal firmly and expeditiously with either under existing laws). It would be a mistake to substitute over-regulation for (for example) inad- equate criminal enforcement. On the other hand, we urge ICOs to improve their self- regulation so regulators can be less concerned about the risks. We recognize that if ICOs do not themselves improve, then they can expect regulators to tighten up.

Meanwhile, regulators should strive not to unduly delay applications for exemption by existing dealer licensees who have built up appropriate operating practices and who would like to manage the distribution of ICOs across all jurisdictions.

If ICOs are regulated appropriately and a vibrant market develops, then they will likely supersede many of the investment crowdfunding models in the market today.

As with traditional crowdfunding, if ICO regulation is too costly, then companies, in- vestors, and infrastructure providers will move to foreign markets and jurisdictions that offer more facilitative and supportive capital raising. Lack of certainty is also driving ICOs to other markets. Canadian issuers and investors both need more guidance, soon, on the regulatory approach(es) in Canada.


4. What kind of educational/awareness outreach opportunities or mechanisms should BCSC be considering?

The Financial Consumer Agency of Canada has taken the lead on financial literacy with good results. They may be best placed to take the lead on education and awareness of crowdfunding and innovation finance. One body should be working with regulators, the private sector, and others for consistent online/offline educational programs, developing and tracking key metrics, benchmarking, and participating in research initiatives. We should be working together to do more and not wasting resources by re-inventing the wheel.


Part 4 - Online advisers

We leave this section for response by our members.


Part 5 - Cryptocurrency funds

Given the present uncertainties, we advocate a wait and see approach (as in the UK - your-money/. Regulators should not hastily impose more requirements where they quite possibly are not needed. We commend BCSC for its more open attitude to cryptocurrencies.

NCFA also supports the creation of a Canadian crypto task force - https://cointele- It is extremely important that stakeholders collaborate, that Canada remain in synch with important jurisdictions, and that regulation is essentially global.


Part 6 - ICOs and cryptocurrencies

  1. At this point in the evolution of the ICO markets, we think that the exemption power is sufficient, along with general warnings to investors about the risks of both regulated and unregulated ICOs. It is not obvious to us that new regulatory requirements are needed. What is obvious is the need for close collaboration among regulators and the industry across Canada and globally, and firm enforcement of existing laws.
  2. We do not comment on the variables listed. The main point here that Canada must remain broadly in synch with important jurisdictions such as the USA , Australia, New Zealand, Singapore, and the UK.


Part 7 - Fintech regulation in the future

34/35. The NCFA supports a 12-month exemption similar to the ASIC exemption, with similar safeguards.

36.  The NCFA has already provided its views to the BCSC on regulatory requirements or approaches that stifle innovation and how they should be removed or changed.

39 to 42. We support the risk-based approach of the UK Financial Conduct Authority where data collection and analysis are also a priority.

Regulators, governments, and other stakeholders in Canada should be closely following what more advanced regulators (and markets such as the UK, Australia, New Zealand, China, and Singapore are doing). These jurisdictions are well ahead of us.

Most studies of fintech around the world assert that collaboration among regulators, governments, and with the private sector needs to improve. Without improved collabora- tion, and without an over-arching strategy for innovation, both regulation and the mar- kets in Canada (overall) will remain sub-standard.


Other points

The BCSC Notice states that BC’s start-up ecosystem has been ranked among the strongest in the world. Although we agree that the regime is more supportive of start-ups than in other Canadian jurisdictions, it would be helpful to know who has provided this ranking (and to see the data that supports it).

It is a constant struggle in the start-up ecosystems in Canada to gain access to data and analysis about what is going on the markets of the provinces and across Canada as a whole. Smart regulation and meaningful cost/benefit analysis is impossible without it.

We lag far behind the UK and others in data collection and analysis. To provide one ex- ample of how this is problematic, the BCSC Notice states that “respondents noted the limited risk appetite among BC investors and pool of available capital in BC as signifi- cant non-regulatory barriers to growth and development”. We wonder whether better data would support that conclusion. Our members do not perceive that BC investors are inherently risk averse. Rather they may lack education or awareness about investing in innovation and fintech, but are keen once they learn and feel more comfortable with the ecosystem. (We have explained in earlier submissions that certain regulatory changes would actually help investors to manage/spread their risks.)

At Globe Forum 2018 in March, Canadian capital providers noted that their Canadian investments in innovation were limited less by the lack of capital and more by the lack of good projects coming up through the system. This suggests to us that start-ups are blocked by the costs of start-up in Canada, rather than lack of capital as such. But we do not have the hard data to back this up.

We very much support the creation of the BCSC Tech Team and have been impressed by the team’s willingness to learn, to talk openly with our members, and to provide guid- ance to entrepreneurs where appropriate. The BCSC has become an increasingly valuable sponsor and participant at NCFA conferences such as VanFunding.

We are encouraged by BCSC and OSC collaboration with other regulators to improve the sandbox in a way that is consistent with other jurisdictions such as the UK and Aus- tralia, and by efforts to harmonize regulatory approaches to licensing and guidance across CSA. However, we repeat the NCFA’s recent submission to Finance Canada where we said -

The NCFA urges the federal and provincial governments, as well as the provincial and territorial securities regulators, to work together with the private sector on a strategy:

  • to reduce regulatory burden,
  • to champion innovation,
  • to make good use of proven tax and other incentives, and
  • to ensure adequate data collection and analysis, as well as education and awareness.

April 2018

Download the PDF submission --> here


The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders across the country. NCFA Canada provides education, research, industry stewardship, and networking opportunities to over 1600+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry in Canada.  For more information, please visit:


Victoria Bennett, Strategic Marketing Principal, Bennett Milner Williams Consulting Ltd., Joins NCFA’s Ambassador Program


About NCFA Canada | Craig Asano | March 21, 2018

CALGARY, Mar 21, 2018 – The National Crowdfunding & Fintech Association of Canada (NCFA Canada) today announced that Victoria Bennett, Strategic Marketing Principal, Bennett Milner Williams Consulting Ltd., has joined the Association’s Ambassadors Program.

NCFA Canada Ambassadors

NCFA Canada Ambassadors are leaders, educators, supporters and advocates of an inclusive and broad-based alternative finance crowdfunding industry in communities across Canada. They are circles of influence and ‘go to resources’ for small businesses, organizations and investors to connect with, share and learn about crowdfunding via locally hosted events and initiatives. Ambassadors are specialists and plugged into an international network of shared resources, thought leadership, and industry professionals striving to cultivate and shape the future of finance in Canada and beyond.

Victoria Bennett, Strategic Marketing Principal, Bennett Milner Williams Consulting Ltd.

Victoria Bennett ran her first successful crowdfund campaign over four years ago, a long time in crowd funding years. A strategic marketer by training, she has worked on many major brands including Tide, Pampers, ENMAX and TD. She has used her skills as a marketer, to identify the solution the product or service provides, the target market, the so-what, and to communicate clearly, effectively and consistently to the crowd; all skills vital to crowdfunding. She has run successful campaigns in Canada and in Europe and her team is currently consulting for a number of Canadian equity and rewards crowdfund campaigns.

"Entrepreneurs are not well served by the current closed networks, if you don’t have a good network of friends and family, any great idea will fail. The Canadian government opened up equity crowdfunding in 2015 and we have seen companies in both the start-up and growth stage benefit. The benefits, whether it be rewards or investment crowdfunding are much more than just the capital, a community of advocates, who believe in the company.  The pace of adoption has not been at the same rate as in the US and particularly the UK where government policy has strongly encouraged investment crowdfunding to finance companies. I am pleased to see NCFA lobbying the government for further support and policy change for crowdfunding, and hope to see the benefits across all crowdfunding platforms," said Victoria Bennett, NCFA Ambassador

“The fintech and crowdfunding sectors in Canada need more experienced advocates who truly understand the capital and growth benefits for small businesses launching ventures or products to market inherent in crowdfinancing, along with the wider economic benefits and job creation for the country and welcome Victoria’s sustained expertise and industry support," said Craig Asano, CEO, NCFA Canada.

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The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders across the country. NCFA Canada provides education, research, industry stewardship, and networking opportunities to over 1600+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry in Canada.  For more information, please visit:

Source: NCFA Canada

For more information please contact:

Media Contacts:

Craig Asano
NCFA Canada
Founder and CEO
p. (416) 618-0254


Michael R. King, Tangerine Chair in Finance and Co-Director, Scotiabank Digital Banking Lab – Ivey Business School at Western University Joins the National Crowdfunding & Fintech Association of Canada’s Advisory Group


NCFA Canada | Craig Asano | March 19, 2018

Michael R. King, PhD CFA,
Advisor, Fintech Research & Education

TORONTO, MAR 19, 2018 – The National Crowdfunding & Fintech Association of Canada (NCFA) today announced that Prof. Michael R. King, Tangerine Chair in Finance and Co-Director of the Scotiabank Digital Banking Lab at Ivey Business School, Western University, has joined the Association`s growing Advisory Group to advise on the areas fintech research and education.

Michael R. King, PhD CFA - Tangerine Chair in Finance, Co-Director, Scotiabank Digital Banking Lab - Ivey Business School at Western University Professor Michael King is the co-Director of the Scotiabank Digital Banking Lab at Ivey Business School – Canada’s first research centre studying the impact of financial technologies (“FinTech”) on banking and financial services. Michael joined Ivey in 2011 after two decades working in international financial markets.

Between 1990 and 1998 Michael worked in investment banking and trading in New York, London, and Zurich with Credit Suisse and RBC Dominion Securities. After finishing his PhD at the London School of Economics, Michael joined the Bank of Canada in Ottawa from 2001 to 2008 where he worked in the Financial Markets and International Departments.  From 2008 to 2011, Michael worked for the Bank for International Settlements (BIS) in Basel, Switzerland studying financial markets, foreign exchange, and banking regulation.

At Ivey, Michael is an Associate Finance Professor and teaches on the undergraduate, MBA and Executive Education programs. His research focuses on fintech, banking, capital markets, and international finance. He is a member of the Responsible Research for Business and Management (RRBM) Network, which believes in producing credible knowledge that is ultimately useful for addressing problems important to business and society.

“It is a privilege to be joining the NCFA Advisory Group at this critical juncture in the development of Canada’s fintech ecosystem. The NCFA has been playing a leading role to advance crowdfunding and fintech through its publications, its conferences, and its outreach to regulators and policymakers. At Ivey, we share the belief that Canada can and should be a leader in fintech globally. We also feel passionately that more needs to be done to educate the public on the benefits of fintech, and to highlight for decision makers the obstacles to innovation. Analysis and advocacy backed by research and data collection are important tools for advancing this vital sector.” -- Michael R. King, PhD CFA

“The growth of fintech in Canada needs the full support of regulators, government and the whole fintech ecosystem to come together to address opportunities and challenges.  We’re thrilled and welcome Prof. King’s contributions across the board and look forward to developing a strategic roadmap to advance education and fill data collection gaps to further impact the growth and global competitiveness of crowdfunding and fintech in Canada” – Craig Asano, NCFA Canada


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The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders across the country. NCFA Canada provides education, research, industry stewardship, and networking opportunities to over 1600+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding industry in Canada.  For more information, please visit:


Craig Asano
Founder and CEO
NCFA Canada
416 618 0254


NCFA Canada’s submission to Finance Canada (March 2018): Urgent Need for Regulatory Change and Government Support


NCFA Canada | March 15, 2018

On Tuesday, March 13, 2018, the National Crowdfunding & Fintech Association participated on a call with Finance Canada in Ottawa to discuss it's latest submission calling for an urgent need for regulatory changes and government support to ensure the Canadian fintech sector is not being held back and remains competitive with international comparators such as in the UK and US.  Below are the highlights of the submission that can be viewed/downloaded in full at the bottom of this post.

We'd like to thank Robin Ford, NCFA Advisor, Regulations and Governance for leading a group effort by the following participating NCFA members (in alphabetical order):

Alan Wunsche, Blockchain Canada
Alixe Cormick, Venture Law Corp
Amar Nijjar, R2 Capital / Investments
Beverly Brooks, Brooks Communications
Brad Kerr, FundingNomad
Cato Pastoll, LendingLoop
Craig Asano, Founder/Director, NCFA
Daryl Hatton, FundRazr / Director, NCFA
Douglas Cumming, Finance Professor, York University
Hitesh Rathod, NexusCrowd
Jason Saltzman, Gowling Canada LLP
Marcel Schroder, Managing Director, Vaultcircle (Lendified)
Marcus New, InvestX
Marty Gunderson, Director, NCFA
Peter-Paul Van Hoeken, FrontFundr
Richard Remillard, RCG Group / Director, NCFA
Robin Ford, former Head of Dept UK FSA, former Executive Commissioner BCSC, Consultant
Rubsun Ho/Sandy Hershaw, Crowdmatrix


1. OVERVIEW: Crowdfunding & Fintech are being held back in Canada

Canada’s crowdfunding and fintech “ecosystem” should be competitive, be in line with global trends, and enable early stage entrepreneurs to access smaller amounts of capital (ie, < $5 million) at a reasonable cost. Unfortunately it is not. There is a‘funding gap’ in the market as many smaller companies find it very challenging to raise debt or equity financing in Canada. This means fewer innovative start-ups, fewer opportunities for investors, and constraints on economic growth (and jobs).

The National Crowdfunding & Fintech Association of Canada (NCFA) has conducted numerous stakeholder consultations which overwhelmingly tell us that the regulatory requirements are overly prescriptive, complex, and burdensome (costly). The capital markets regulators in Canada have attempted to address the market problems within their jurisdictions, but so far without much success.

Canada is falling behind international comparators such as the United Kingdom and the United States. Entrepreneurs are reluctant to start up in Canada due to the high costs (relative to a small financing), and significant ongoing regulatory burdens. Investors are inhibited by eg caps on investment and limited education about  the  benefits  and  downside  risks  of  crowdfunding  and  other  exempt financings. This pushes many talented entrepreneurs and investors to overseas jurisdictions that better understand (and support) innovation and the economic potential of start-ups and small businesses.

The NCFA is very concerned about this and has strongly encouraged the BCSC and OSC to work smarter (and harder) to streamline regulation across the country, and to reduce undue burdens (that are not justified by the risks).

The NCFA now asks the federal government to work with the provinces and regulators to provide the required strategic direction and leadership needed to enhance Canada’s competitiveness.



The benefits of crowdfunding are broadly accepted and frequently described, eg - crowdfunding-2/#3fd5ab4c2c5e.

The same is true of fintech, eg - capturing-the-benefits-avoiding-the-risks/.

If the NCFA recommendations in this submission were to be implemented, the experience of other jurisdictions makes clear that more capital would be raised, especially for under-serviced sectors (eg, women and minority groups, including First Nations and rural areas). Investors would also have increased confidence and more freedom to invest as they choose.

We have a lot of tech and innovation talent in Canada. As the Competition Bureau has pointed out (Dec 2017 -, a more flexible approach to regulation and adequate government support would provide significant economic benefits by freeing entrepreneurship. It would also help to keep our entrepreneurs in Canada (along with the related jobs), boost GDP (especially by improving productivity), and encourage the commercialization of new products and services generally.



As the leading and only dedicated crowdfunding and fintech association in Canada, the NCFA has consulted numerous registrants, industry experts, and practitioners in the sector about the most pressing challenges.  They say:

  1. Investment-based crowdfunding requirements are far from internationally competitive with respect to raising non-bank funding.
  2. Regulatory requirements are overly prescriptive with a one size fits all approach (versus risk-based) that is not working.
  3. Regulatory regimes in Canada are not harmonized and are overly complex which adds significantly to the costs of start-up and ongoing compliance.
  4. Lack of co-ordinated governmental incentives and support for innovation and for education and awareness puts Canada at a disadvantage that our competitors are happy to exploit.


A. Overly prescriptive requirements

Many entrepreneurs been discouraged by high legal fees, onerous reporting requirements, and other burdens. While entry into the market may be possible, entrepreneurs are also inhibited by ongoing costs of compliance and high hurdles for future financings that will limit their ability to scale up.

For example, only a small number of issuers have used online platforms to raise capital under the Accredited Investor or Offering Memorandum Exemptions in Ontario. While the Offering Memorandum Exemption is gaining some traction and is used by several NCFA member portals, it is primarily aimed at companies wishing to raise at least $250,000 (due to the costs, for example, of preparing the necessary legal and financial documentation).  Most early stage companies seeking to  raise  smaller  amounts  of  capital  cannot  realistically  use  the  OM  (or  the Integrated Crowdfunding Exemption MI 45-108 due to similarly high costs).

These exemptions are also inadequate for most marketplace lending platforms. For example, they do not allow the multi-party participation of public, private and government blended funding models which have developed in the UK and elsewhere, or membership marketplace lending models. (See Appendix 10:  P2P Lending.)

BC and some other jurisdictions have a ‘lighter’ set of crowdfunding requirements (eg, the ‘Start-up Crowdfunding Registration and Prospectus Exemptions MN 45-316 that allow small firms to raise up to $250,000 per offering (twice a year), with participation from other provinces). If there is not be a move towards a risk based approach, then the NCFA supports BC’s regime and proposes that other jurisdictions at least allow BC offers to be distributed across Canada under a mutual   recognition   system.   (NCFA   was   pleased   to   see   BCSC’s   recent announcement   of   changes   to   the   Startup   Exemptions   (BCI   45-535)   - up_crowdfunding_exemption_will_increase_access_to_capital_for_B_C    issuers)

For more recommendations to streamline regulation see Appendix 11.

The NCFA encourages regulators not only to adopt a more risk-based approach, but also to improve the measurement of the cost of a proposed regulatory solution against its benefits. Detailed or prescriptive controls should only be imposed when clearly justified. Market problems should not be “resolved” by additional requirements unless demonstrated benefits exceed costs. (See Appendices 5 and 6

Prohibitions on Advertising and Solicitation’ and ‘Frequency of Reporting Requirements’ for a high-level analysis of two requirements where we conclude that the costs far outweighs any benefit, and Appendix 7 ‘Regulatory approach’.)


B. Regulation is not harmonized and is overly complex

There  are  currently  three  versions  of  crowdfunding  specific  requirements  in Canada that form a patchwork that varies with respect to offering documentation, ongoing   disclosure   requirements,   capital   raising   and   investor   limits,   and advertising. These differences make it more costly for early stage companies, most of whom want to raise funds and do business in more than one jurisdiction (with additional costs for issuers of approximately $5,000 - $20,000 in legal fees alone).

The differences among the regulatory systems are outlined in Appendix 1. The table illustrates how complex and varied the requirements are, causing confusion and frustration for all market participants. Appendix 2 shows that differences exist even among jurisdictions participating in the same instrument, in this case MI 45-108.


C. Lack of incentives and support for education and innovation

Introducing new requirements/exemptions without a robust ongoing educational program is like asking new drivers to follow a road that contains no ‘signs’, without maps.  To increase the use of the new financing tools, in addition to the regulatory changes the NCFA proposes in this submission, many more businesses and individuals need to be educated about the opportunities and threats for both entrepreneurs and investors.

We have selected some insights from the NCFA’s annual 2017 Alternative Finance Crowdfunding survey of 170 responders (Jun-Jul 2017) including investment platforms, companies seeking capital, and a wide range of investors (including VC/PE and institutional investors):   (See: Appendix 3  NCFA Selected Survey Results Charts)

  • When asked ‘What do you think is needed to attract more investors to the Canadian  alternative  finance  crowdfunding  markets?”    The  number  one (70% of the responders) answer was “More education”.
  • When  issuers  were  asked  “Has  your  company  ever  raised  capital  via alternative finance crowdfunding markets before?” the overwhelming majority (approximately 90%) responded ‘No’.
  • When asked why not, issuers’ number one reason (over 55%) was that they were ‘Unaware of how it works’.

While regulators have provided dedicated web pages to help potential investors and issuers better understand the capital markets, the information is limited. According  to  a  recently  published  Ernst  &  Young  “Fintech  Adoption  Index” survey, Canada has one of the lowest fintech adoption rates in the world and a central reason for this is lack of awareness. Over 70% of the respondents thought that more education was required to attract more investors to crowdfunding and that the regulators should publish more market analyses.

Data collection and analysis is poor in Canada. In contrast, the Securities and Exchange Commission (SEC) recently published an extensive whitepaper on Title III Regulation crowdfunding activity titled ‘U.S. Securities-based Crowdfunding under Title III of the JOBS Act’ that reviews offering activity, characteristics, geographic distribution and regulated platforms performance, characteristics and compensation rates.

It is crucial that data collection and analysis be improved in Canada (in collaboration with the private sector) so that we can better understand the markets and pinpoint problem areas (to enable evidence-based decisions).

Finally, we were pleased to see the announcement of the new federal program Innovative Solutions Canada as well as the support in Budget 2018, building on Budget 2017. These are steps in the right direction (and we are aware of some older federal programs). But Canada still needs a comprehensive innovation strategy and an integrated program of incentives and support. Governments, regulators, and the private sector need to work together more strategically. Other jurisdictions like the UK, Singapore, and Hong Kong are well ahead of us.



A. Work harder to harmonize and reduce unjustified regulatory burden

Prescriptive and complex regulation is simply inappropriate in a highly innovative and fast paced  digital  space.  Moreover,  businesses  cannot  be  as  nimble  and responsive to market demand.

We acknowledge that a change to a more risk based and principles based approach is not easy. Indeed it would require a profound change in regulatory culture and a significant and long term commitment from Ministers and regulatory boards and senior management. But short of that, there is much that can be done. The NCFA has made specific recommendations for regulatory change. (See Appendix 11.) (Regtech must also be part of a change of approach, but we do not discuss that here.)

B. Governments to support regulatory change

The  NCFA  strongly  supports  CSA  initiatives  such  as  “sandboxes” and  cross- border agreements (such as the recently announced agreement between some Canadian  regulators  and  the  French  AMF  FinTech,  Innovation  and Competitiveness Division). But it is not enough. (In the UK, the FCA is now pushing for sandbox improvements globally.)

There is a crucial role here for governments, especially the federal government, to champion innovation, to agree a fintech or innovation strategy with the provinces, to use already proven tax and other incentives, and to work with the private sector to ensure adequate data collection and analysis. The profound change in regulatory approach in the UK starting in 1997 could not have happened without the strategic planning and leadership of Number 10.

More government resources and support for innovation and education

While educational conferences are in high demand and markets are slowly gaining traction in Canada, the sector needs more government support to encourage and enable more portals  and  participants  to  start-up,  ‘scale  up’,  and  operate  more efficiently.    There  is  a  large  knowledge  gap  due  to  the  real  (or  perceived) complexities and burdens involved in putting together an online financing round. Businesses and investors need to be better educated about the options and the available  support  facilities  and  incentives.  Education  is  an  investment  by governments,  working  with  the  private  sector,  that  will  generate  more  capital investment and jobs, as well as making potential investors more risk aware.  (See Appendix   4:       Private-public   growth   model   for   the   alternative   finance crowdfunding industry.)



Governments play an essential role in facilitating and encouraging innovation and entrepreneurship. While one might now add to it, a wide ranging 2010 paper by PWC provides a good overview of how this can be done -   The   report   concludes:   “Countries  that   understand   their   particular economic profile, and design the right strategy to suit that profile, stand to raise the odds of success in fostering innovation.”


The NCFA urges the federal and provincial governments, as well as the provincial and territorial securities regulators, to work together:

  • to reduce regulatory burden, to champion innovation,
  • to make good use of proven tax and other incentives, and
  • to work with the private sector to ensure adequate data collection and analysis, as well as education and awareness.

If not, we will fall further behind.

The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding, alternative finance, fintech, P2P, ICO, and online investing stakeholders across the country. NCFA Canada provides education, research, industry stewardship, and networking opportunities to over 1600+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding industry in Canada.  For more information, please visit:


Global Blockchain Becomes Media Sponsor for FFCON18: VELOCITY


Global Blockchain Release | Shidan Gouran | March 2, 2018

Participating alongside leading names in blockchain, fintech and the finance world, this conference will be where many advances for blockchain will occur in 2018.

VANCOUVER, British Columbia, March 02, 2018 (GLOBE NEWSWIRE) -- GLOBAL BLOCKCHAIN TECHNOLOGIES CORP. (CSE:BLOC) (CSE:BLOC.CN) (CSE:BLOC.CNX) (FSE:BWSP) (OTC:BLKCF) ("BLOC" or the "Company") is pleased to announce that it will be a media partner for the Fintech and Funding Conference of 2018.

The National Crowdfunding & Fintech Association of Canada (NCFA) and partners are proud to present FFCON18: VELOCITY (2018 Fintech and Funding Conference) on Monday, March 5th and Tuesday, March 6th. Currently in its fourth year, this conference offers a full scope of insights, knowledge and commentary from leaders and innovators in the blockchain industry;  as well as regulators, lawyers and several notable names in the world of tech. BLOC is proud to announce that it will be a media partner for this event, giving it presence at what will be a defining conference for the trajectory of the blockchain in Canada for 2018 and beyond.

“We are honoured to have BLOC on board as a media partner,” says Craig Asano - Founder and CEO of NCFA. “Their accomplishments to date in blockchain-related ventures have helped to put Canada on the map as a leading market in this sphere. We’re thrilled to have BLOC participate at FFCON, because we know the amount of influence that they carry in this field - which is very much of interest to our attendees, exhibitors and speakers.”

See:  Fintech and Funding 2018 Conference March 5-6, Toronto, Blockchain, Crypto and Alternative Investing

At the conference, there will be five different streams of content, several learning and networking events, VIP one-on-one meetings, 12 pitching companies, and over 50 speakers - including  the President of BLOC, Mr. Shidan Gouran.

“I’m really happy that we’re getting to be part of this conference,” says Mr. Gouran. “As blockchain jumps past the initial hurdles of adoption, everyone is trying to understand all of the different angles of it - taking somewhat of a holistic approach. The team behind FFCON has done a great job to bring in experts from nearly every relevant area, and this is going to be an event that you don’t want to miss if you want to be part of Canada’s climb to the top of the blockchain world.”

In light of substantial changes to and developments in cryptocurrencies and the blockchain over the past year, this will be the most impactful FFCON event so far. With even greater changes and developments coming on an even larger scale, the insights that come from this event will be essential both for active blockchain participants and for entities who are just getting introduced to it.

For more information, please contact

On behalf of the Company:
Shidan Gouran, President
(416) 854-3017

About Global Blockchain Technologies Corp.

The Company provides investors access to a basket of direct and indirect holdings within the blockchain space, managed by a team of industry pioneers and early adopters of all major cryptocurrencies.

BLOC is listed on the Canadian Securities Exchange (“CSE”) and its common shares trade under the ticker symbol "BLOC". Additional information relating to BLOC is available on SEDAR at, the CSE at, as well as on the Company's website at


FFCON (Fintech and Funding Conference) is an annual conference hosted by NCFA Canada in its fourth year, with an educational objective that brings together professionals and innovators in blockchain, cryptocurrency, and alternative investing. It is being held on Monday, March 5th and Tuesday, March 6th, 2018 in downtown Toronto. The VELOCITY theme is all about speed, efficiency, and reducing friction; all of which are commonly shared objectives among participants in the blockchain ecosystem. Additional information about the conference can be found at


Jan 8, 2018: Intro Presentation on Raising Equity and Funding for your Startup


NCFA Canada | Jan 15, 2018

Slides:  NCFA Canada Founder and CEO, Craig Asano, delivers a presentation on raising equity and funding for the graduating class of Founder Institute companies in Toronto on Jan 8:

  1. Equity & Funding Introduction Date: January 8, 2018 Prepared for: Founders Institute Toronto Prepared by: Craig Asano, NCFA Canada
  2. Fintech & Funding Association Massive Fintech Network Partners Advisors Members 90+ Platforms 20+ Providers 45 Portals 2018 2017 2016 2015 Oct 2012 Programs Services Global Network P1 P2
  3. Are you ready to raise capital?
  4. Are you ready to raise capital? Set your valuation appropriately • Look for comparable businesses • Geographic and investor group dependent • Discounted cash flow. Make your projections realistic. would you be willing to take your compensation as a % of forecast? • Ultimately a negotiation between investors and the business • Expect 10% - 30% dilution per round • Use preferred shares, convertible notes, SAFE / SAFT if uncertain or to avoid significant dilution How much time can you devote to funding? • Do not do this half ass. If after a defined period (ie 1 year) you’ve been unsuccessful then face facts (markets are highly efficient) • Understand potential impact to ego / brand equity and team motivation • Leverage templates. Be resourceful. Seek expertise.
  5. Are you ready to raise capital? How much money should we raise? • Determine key milestones that impact business’ value • IP strategy, Prototype • Sales and Revenue (ie repeat customers/month • Product/market fit or key development milestones • Human resources and team building (growth) • Raise what you need to get you to the next milestone (iterate and prove) Bootstrapping: advance your situation using existing resources Lean start-up: get to market and revenue positive as quickly as possible What non-dilutive sources of capital are available at each step?
  6. Are you ready to raise capital? Understand your initial capital structure (and dilution) • Founders (80-90%), Leadership team (10-15%), Advisors (1-3%) • Skin in the game • Put in writing and use vested agreements • Source cap table excel sheets online
  7. Where can I find Investors? • Identify potential investors and sources of funding (keep doors open): • Government grants / funds • Corporate sponsorships and grant programs • Friends and family, Loans and credit • Crowdfunding (Equity, debt/lending, reward, ICOs/tokens, Royalty) • Angel investors • Venture capital • Dealer-brokers, agents, intermediaries • Private equity interested in side-car investments • Ask for introductions • Global markets Sources of Private Capital
  8. Be strategic with your approach • Make a list of contacts that can realistically help (assign probability and amount you are seeking from them) • Seek to develop long term relationships and understand what you can offer them and vice versa. • Learning loop: Listen – learn – track and improve (alignment, probability) • Start building your funding networks yesterday • Online – personal & company profiles • Offline - Events, conferences, pitch forums, investor networks • Understand the timing of your ask relative to the ‘funding window’ and type of investor • Stay on top of funding research and news to find similar companies to learn from / with. • Ask for introductions • Turn advocates into loyal customers and investors Get in Funding Mode
  9. What are investors looking for? • A product/services that addresses a large market need (not a nice to have) • Team that can execute who has a solid understanding of business and challenges • Validation/proof (de-risk) • Some are seeking social impact or to balance impact with profits The Investment Process • Pitch deck is bare essential • Meet and greet is only the first step • All investment basics must be met • Due diligence review • Terms negotiated • Close (in person) What are investors looking for?
  10. Deal Breakers and Tips • Avoid one man team, no skin in the game, unrealistic valuations, serious character flaws • Raise equity capital with no clear purpose, to replace debt, pay big salaries, to develop an idea and not a business • Face to face meetings (3-5x more capital $ than email or call) • Securing initial key/lead investor will make raising $ significantly easier • Only invest if they know you, know the business and like the investment opportunity What you Need to get Started
  11. Basic Crowdfunding Models < $10K $10 - $250K < $100 - $350K+ < $250K - $3M+ Social Material Investment Benefits
  12. Raising Capital Online in Canada
  13. Wide distribution over the internet • Low cost, efficient, transparent capital • The `great equalizer` • Media/PR, awareness • Increase customer engagement and • Evangelize backers into investors (customer acquisition) • Reduce risk by getting feedback on new launches (product or ventures) • Market research Access to Capital Marketing Platform Validation • Raising funds via crowdfunding markets is a very public and transparent • Protect your IP and speak to a lawyer • Crowdfunding takes a lot of effort and commitment • The majority of Ideas fail to reach their funding goal • How will this affect your companies brand? Expose your Idea Resourcing Failure Crowdfunding Pros/Cons Benefits Risks For Companies
  14. Examples Source: Kickstarter Campaign page Innovation – Social – Incentives – Economic Growth Quidni Estate Winery (NCFA Director) • Just completed $100K equity raise (for 3% equity ownership) • Took over a winery. Went digital (including online wine sales). Converted virtual wine tasters into investors Impak Finance (Equity Offering) • Raised $1.2 million (goal was $500K for 6%) from 1450 shareholders to create first socially responsible Canadian bank • $500,000 in the first 24 hours! • Inclusive & accessible: $100 shares for $100
  15. NCFA Canadian Online Funding Directory Reward/Donation: Equity-based via Dealer: • Steady growth in portals • Equity, Debt & Royalties all emerging • Fintech is all the rage • Real estate and entertainment, film/media crowdfunding emerging Consumer and Small Business Loans:
  16. Crowdfunding Framework Planning & Strategy • The greater your planning efforts, the greater your chance of achieving your funding goal • Do not launch a crowdfunding campaign if you are not ready. (3 months) (40 days – 90 days) (Ongoing) Post-campaign • Your campaign is done but now you have to deliver on your promise • Fulfillment • Ongoing customer engagement Campaign Execution • Daily execution of tasks outlined in the campaign plan • Control, monitor and adapt Feedback Loop
  17. Success Factors SUCCESS 2. Network Strength • Sizeable online network and social media presence? • Will media/PR and influential bloggers cover your story? 1. Quality Idea & Pitch • Unique, enterprising and clear value proposition (conveyed online in a simple manner) • Get others excited about your story? • Clear funding target and specific goals? 4. Key Docs and Content • Compliant and necessary for investor review 3. Strong Committed Team • Is your team credible, committed and willing to deploy the resources and time to execute effectively? • Time management HARD WORK! 5. Marketing Campaign & Incentives • Planning and strategy with ability to execute through launch to post campaign
  18. Common Mistakes • We underestimated the time commitment involved • We didn’t test our campaign sufficiently • We launched before we were ready • We didn’t develop an accurate budget • We didn’t consult legal counsel or professional providers • We didn’t account for taxes • We tried to do everything on a shoestring • We didn’t realize how important the video was • We didn’t understand liability exposure (eg. misrepresentation) and intellectual property • We had little to no traction so we gave up • We blamed it on the portal
  19. Join Us Education & Research Market Access Crowdfunding Infrastructure Capital Raising Prep Services Support and Leadership Advocacy GET IT IN TOUCH Fintech & Funding Association

The National Crowdfunding Association of Canada (NCFA Canada) is a national non-profit actively engaged with social and investment crowdfunding, alternative finance, fintech, peer-to-peer (P2P), initial coin offerings (ICO), and online investing stakeholders across the country. NCFA Canada provides education, research, industry stewardship, networking opportunities and services to thousands of community members and works closely with industry, government, academia and eco-system partners and affiliates to create a vibrant and innovative fintech and online financing industry in Canada.  For more information, please visit: