Christopher Charlesworth, CEO and Co-founder of HiveWire, Joins National Crowdfunding Association of Canada’s Advisory Board
March 24th, 2017
CJME News Talk 980 | by Karin Yeske | May 28, 2014
A Philadelphia CEO is so excited with Saskatchewan’s entrepreneurial spirit that he’s moving to Saskatoon to foster the province’s crowdfunding activity.
Les Schaevitz, CEO of Holistic Funding Systems Corporation, said Saskatchewan is blazing the trail in equity crowdfunding thanks to a new exemption announced in December 2013.
“Saskatchewan is the only province in all of Canada that has made regulations to allow this to actually happen,” Schaevitz said after speaking on a panel presented by the National Crowdfunding Association of Canada and the Saskatoon Chamber of Commerce. Highlights from the Saskatchewan Equity Crowdfunding Event here
The new portal allows entrepreneurs to raise capital by selling equity over the Internet to non-accredited investors.
Pending the acknowledgment of the Financial and Consumer Affairs Authority (FCAA) later in June, Schaevitz’s Equity Crowdfunding Venture Exchange and Equity Crowdfunding Enterprise Exchange will be soon be active in the province.
Equity crowdfunding is different than simply crowdfunding, where businesses or projects raise money through donations. Equity crowdfunding involves individuals investing in a company, product or service.
Before the new exemption, startups had to pay to deal with expensive rules before they could sell a stake in their company. Entrepreneurs can now skip the red tape with the exception to certain rules.
The business and the investor must be located in Saskatchewan. The entrepreneur can raise up to $300,000 a year (two, six-month offerings of $150,000 each), and no investor can give more than $1,500 in an offering.
There are 225 equity crowdfunding portals worldwide. British Columbia, Alberta, Manitoba, New Brunswick and Nova Scotia are all looking at models similar to Saskatchewan. Ontario is proposing to allow companies to raise a maximum of $1.5 million in a year and individuals would be able to invest no more than $2,500 in a single offering to a maximum of $10,000 per year.