Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Equity Crowdfunding, Alternative Funding
The Shift to Alternative Assets: Overcoming Barriers and Exploring Opportunities
CAIS | Release | Jun 21, 2023
The recent market volatility, interest rate hikes, and a diminishing confidence in public markets have led to an increased demand for alternative investments.
Alternative assets are projected to constitute up to 24% of the global investable market by 2025, a significant increase from 12% in 2018.
- In a survey conducted by CAIS at the 2022 Morningstar Conference:
- 80.9% of financial professionals agreed that all retail investors should have access to such investment avenues. Traditionally favored assets are experiencing muted expectations and alternatives might provide a diversified method for investors looking to hedge against market instability.
- The survey included over 300 registered investment advisors and other industry experts.
- Nearly three-quarters (74.9%) of respondents believe that the SEC's definition of an accredited investor needs updating.
- Respondents anticipate private equity (49.8%), real estate (38.9%), and private credit (33%) to be the top-performing alternative asset classes in 2022.
- Rethinking the Traditional Investment Mix:
- Public market assets have been underperforming in recent years, with the traditional 60/40 portfolio (60% stocks and 40% bonds) delivering some of its lowest returns in the past two decades.
- About 33.6% of survey participants believe this investment strategy is no longer effective.
- Interestingly, 84% of investment or financial advisors are now recommending alternative investments to their clients who meet accredited investor requirements.
See: Celebrating 7 Years of Regulation Crowdfunding: 4100 Startups Now Valued at $60 Billion
- Obstacles to Accessing Alternative Investments:
- A significant 68.98% of respondents cited lack of education around alternatives as a major hurdle.
- Other obstacles include stringent qualification requirements, high administration and paperwork (37.6%), and concerns around due diligence and compliance processes (34.3%).
- Implications for the finance industry:
- This shifting landscape implies a need for financial advisors to stay updated and expand their knowledge of alternative investments. As more alternative products become available, advisors will need to ensure they're well-versed in these complex products to confidently recommend them to their clients. Moreover, calls for updating the SEC's definition of an accredited investor could potentially open up alternative investments to a broader demographic.
View the original release --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Celebrating 7 Years of Regulation Crowdfunding: 4100 Startups Now Valued at $60 Billion
Crowdfund Capital Advisors | Sherwood Neiss | May 16, 2023
Image: Crowdfund Capital Advisors
Today marks a significant milestone as we celebrate the 7th anniversary of Regulation Crowdfunding (Reg CF).
Regulation Crowdfunding (Reg CF) has become successful for several reasons:
- Democratization of Investment: Reg CF has significantly democratized access to capital, enabling individuals to invest in the companies they believe in. This democratization has diversified the investor pool and allowed people who might not otherwise have access to investment opportunities to participate in the financial growth of startups and small businesses.
- Promotion of Diversity and Inclusivity: Reg CF has promoted diversity and inclusivity in the entrepreneurial ecosystem. With up to 50% of the capital going to companies with at least one woman or minority founder, this type of funding is opening the doors for underrepresented groups in business.
- Job Creation: Reg CF has proven to be a significant job creator. It has been instrumental in creating or supporting over 380,000 jobs, thereby becoming an important factor in driving local economies.
See: Equity Crowdfunding Demystified: Insights from Wefunder and Equivesto
As for the impact of Regulation Crowdfunding:
- Economic Impact: To date, $1.8 billion has been invested by 1.7 million investors into over 4,100 startups and small businesses across 1,700 cities in the USA. Moreover, it has contributed approximately $4.7 billion to the overall economy through salaries, inventory, rent, professional services, and various operational expenses.
- Wealth Creation: Companies that have raised funds via Reg CF are now valued at over $60 billion, indicating that average American investors have the potential to realize substantial wealth. This democratizes wealth creation, providing an opportunity for everyday Americans to partake in the financial success of early-stage companies.
- Promotion of Entrepreneurship: By unleashing the entrepreneurial spirit of America, Reg CF has generated jobs and fostered economic growth, becoming a powerful force in supporting local businesses and driving economic prosperity.
Overall, Regulation Crowdfunding has had a significant impact on the US economy and society by democratizing capital, creating wealth, generating jobs, and boosting local economies. Its future potential remains robust, with more opportunities expected to arise for individuals to participate in this transformative investment landscape.
See: CCA 2022 Investment Crowdfunding Report: 7 Charts Highlight Growth and Impact
Sherwood Neiss, Principal at Crowdfund Capital Advisor:
Regulation Crowdfunding has unlocked an unprecedented opportunity for everyday Americans to invest in early-stage companies and participate in the creation of wealth. It has brought about a level playing field, something that the private capital markets have not been able to accomplish until Reg CF became a reality.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Equity Crowdfunding Demystified: Insights from Wefunder and Equivesto
Forbes | Hessie Jones | Apr 3, 2023
Image: Johnny Price Wefunder and Alexander Morsink Equivesto
The time for startups to rethink venture capital alternatives has been gaining momentum.
- Is this the moment for Equity Crowdfunding (ECF) to emerge and become a viable alternative for startups? For startups domiciled in Canada vs the United States, jurisdiction and laws vary when it comes to choosing equity crowdfunding platforms. Qualification, campaign execution and benefits can also be different. What should you consider when getting ready to do your first capital raise?
- I reached out to two ECF platforms: Jonny Price, VP of Fundraising at Wefunder (US) and Alexander Morsink, Managing Partner at Equivesto (Canada) to understand these disparities but also demystify the many stereotypes associated with this emerging fundraising alternative.
See: Australian Equity Crowdfunding Markets Raised $72 Million in 2022
- The Legal Differences between Canada and the US
- Morsink illustrates that the publicly known concept of equity crowd funding is an umbrella term used to describe different ways private companies can raise capital in Canada. Private companies raising capital in Canada use prospectus exemptions, which are legal doorways that any company raising must bring their potential shareholders through.
- The first national ECF rules (NI 45-110 Startup Crowdfunding - similar to RegCF in the US) introduced in 2021 now allow companies raising capital to do so via an online investment platform.
- Offering Memorandum exemption (part of NI 45-106) “which is similar to the Regulation A (US) still allows the company to raise from the general public in Canada, but at no maximum raise limit.” In Canada, this option requires private companies to have ongoing audited financial statements and annual reports filed to regulators where 45-110 does not.
- “Accredited Investor” exemption allows high net worth individuals (HNW) to invest in private companies with no regulatory reporting.
- “Equivesto uses multiple prospectus exemptions at the same time for one issuer, so while a deal on the platform will be listed as an ECF deal open to the public, Angel investors will use the ‘Accredited Investor’ exemption, not the NI45-110 ‘Startup Crowdfunding’ exemption, as the legal doorway to make the investment.”
- Handling large number of investors?
- Wefunder has a lead investor who signs on behalf of all investors via special purpose vehicle (SPV)
- Equivesto recommends issuing a new class of non-voting shares and requiring investors to sign a voting trust agreement. Quarterly updates are recommended to keep investors engaged, and having many smaller investors can benefit the company by providing support and assistance in various ways.
See: Equity Crowdfunding Growth: It Took UK Seedrs 8 Years to Raise the First £1Billion and Only 2 Years for the Next Billion
- Social media is good for ECF because it reaches a lot of people and makes it easy to keep records, but scammers can use it to trick people. How do Wefunder and Equivesto protect people from scams?
- Wefunder and Equivesto both take measures to protect investors from fraudulent ventures in the ECF space, with Wefunder implementing fraud checks and offering features such as Lead Investors to provide signals for investors.
- Equivesto complying with regulatory requirements including verifying company information, conducting background checks on directors, and requiring companies to certify information is truthful before making it available to investors. Companies raising via ECF in Canada must also adhere to strict guidelines when using social media and other platforms to promote their campaigns, and investors are subject to a KYC and suitability review to ensure they are aware of the riskiness of their investments.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Real Estate Crowdfunding: Advice for Investors
March 13, 2023
Image: Pexels/fauxels
Real estate has long been considered a solid and relatively stable investment option, but it can also be an expensive, complex undertaking. That said, with the colossal rise of financial technology, coupled with the democratization of investment opportunities via crowdfunding, investing in real estate is now more accessible than ever.
Real estate crowdfunding represents innovative and exciting investment opportunities for more and more seasoned and aspiring investors to get in on. From security, commercial alarm systems and protocols, to the latest tech innovations, here’s a breakdown of some of the key real estate crowdfunding elements to get your head around when navigating this sector as an investor.
Financial technology
The financial technology (fintech) industry has played a major role in the growth of real estate crowdfunding. Platforms such as Roofstock and Fundrise have made it possible for investors to pool their funds and invest in real estate projects that would previously have been virtually impossible for them to access. These platforms also provide investors with in-depth market information, analysis, and tools that make real estate investing a significantly more transparent and efficient process.
Tip: Research and choose only reputable platforms that can demonstrate a strong track record in real estate crowdfunding.
Innovation
Progress is always dependent upon innovation, and the real estate sector has seen no shortage of it in recent years, with new and innovative technologies and concepts playing a key role in the success of real estate crowdfunding. Startups such as RealtyMogul and Cadre have leveraged both artificial intelligence (AI) and blockchain technology to deliver substantially more sophisticated investment options. By utilizing data-driven insights and machine-learning algorithms, companies like these are positioned to offer investors a far more personalized investment experience and improved investment returns.
Tip: When considering investing in companies that utilize innovative technologies, do your due diligence to fully understand the potential risks associated with the investment.
Small business and entrepreneurship
Real estate crowdfunding also provides a simplified avenue for small businesses and entrepreneurs to access capital. Platforms like GroundFloor and PatchofLand are making it supremely easier for developers and small businesses to raise funds from a diverse collection of investors. These fundamental shifts in investment trends have helped to level the playing field, giving smaller players a real chance to compete in the property market.
Tip: Invest in projects with a solid business plan, and stick with teams that demonstrate expertise in real estate development.
Digital identity
The concept of digital identity has become an increasingly important aspect of the world of real estate crowdfunding. Investors must verify their identities to comply with regulations and to ensure the security of their own investments. Platforms such as RealCrowd and CrowdStreet have developed sophisticated verification processes that make it easier for investors to participate in crowdfunding projects.
Tip: Go with a platform that prioritizes security and features a robust identity verification process to ensure investment safety.
AR/VR and the metaverse
Augmented Reality (AR), Virtual Reality (VR), and the metaverse all have the potential to transform the way investors participate in real estate crowdfunding. These cutting-edge technologies can provide investors with a more immersive experience, allowing them to explore virtual properties and (otherwise inaccessible) investment opportunities. Companies like VR Global and Rendever are already utilizing these technologies, providing investors with a highly engaging, interactive experience.
Tip: When considering investing in companies that leverage these technologies, keep in mind that this is a relatively new field, and the associated risks may be higher.
Startups to scale-ups
Real estate crowdfunding provides a pathway for startups to quickly become scale-ups. Companies such as RoofStock and Fundrise began as small startups and have since grown into multi-million dollar enterprises.
Tip: More and more startups now have the potential to transition quickly into scale-ups, but remember that it’s still riskier to invest in early-stage companies, so do your due diligence.
Peer-to-peer finance
Peer-to-peer finance has become a key component of real estate crowdfunding. Platforms like LendingHome and PeerStreet give investors access to opportunities to lend money to developers and borrowers, significantly reducing the barriers to entry for investors and providing an additional finance source for developers.
Tip: Stick to platforms with a solid track record in peer-to-peer lending and consider diversifying your investments across multiple projects.
Blockchain
Blockchain technology is transforming the real estate industry as we speak, by providing a secure and transparent way to conduct transactions. Companies like Propy and Harbor utilize blockchain technologies to streamline the process of buying and selling property; blockchain tech and smart contracts help companies like these to significantly reduce the time and cost associated with many real estate transactions.
Tip: Blockchain is tipped to revolutionize the industry, so any company that is utilizing it effectively is worth serious consideration.
Artificial Intelligence (AI)
Artificial Intelligence (AI) has also played a key role in the growth of real estate crowdfunding, with companies like RoofStock and Cadre utilizing AI for data analysis and investment opportunity insights. By leveraging big data analysis into market trends, historical data, and more, better predictions can be made regarding future market movements, and otherwise-overlooked investment opportunities can be uncovered.
Tip: When considering investing in companies that utilize AI technology, carefully analyze their algorithms and data sources to ensure reliability.
Security and governance
Platforms must comply with regulations and ensure the security of their investor’s funds. Companies like CrowdStreet and Fundrise have developed robust security and governance protocols to ensure the protection of investor funds and sensitive data.
Tip: Always opt for reputable platforms with a good history of security and watertight protocols in place to protect your investments.
Insurtech
Insurance technologies (Insurtech) have been transforming the Insurance Industry in recent years, and the innovative products in this space are also providing property investors with increased peace of mind. Companies such as PeerStreet and RoofStock offer insurance policies to protect investments and investor funds, thus reducing some of the risks associated with real estate investing.
Tip: As with any insurance policy, always read the policy terms, conditions, and fine print carefully before making any decisions.
Image: Unsplash/Tierra Mallorca
The future is now
Never before have we been living in the midst of such a transformational time, with technological advances revolutionizing industries and creating new ways to invest. Real estate crowdfunding is one such innovation, leveraging fintech, blockchain, AI, and more to bring about unprecedented access to investment and funding opportunities.
Investors must do their due diligence and research any platform and investment opportunity they consider. Still, any investor attempting to navigate the world of real estate without embracing all that real estate crowdfunding has to offer will soon be left eating the dust of those that do.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Seedrs Update: UK Equity Crowdfunder Raises Over US$100 Million Online Capital In February
Crowdfund Insider | | Mar 10, 2023
Seedrs, a top UK-based investment crowdfunding platform that operates across Europe, is reporting £84 million in investment across all securities offerings during the month of February (so Seedrs could top USD $ 1 billion during 2023)
- Seedrs noted it booked its 49th exit of a portfolio company as Cushon, a Fintech, was acquired by Natwest Group. Seedrs investors received £7 million in returns, with the earliest investors capturing 5X times the money invested, before tax relief. Cushon completed multiple funding rounds on Seedrs so later investors received smaller returns.
- February 2023: Seedrs said that nine “primary campaigns” (or retail offerings) raised £18.5 million from over 3,800 investors. Seedrs highlighted the following securities offerings during the month including:
- Tandem, a UK-based regulated digital bank, raised £8 million in a Private Deal Room offering
- OddBox, a Foodtech startup, raised £5.9million to fund their mission of having consumers use unwanted produce
- Fantasy football platform Fantasy Football Hub raised £788,000
- Fintech The Portfolio Platform secured £ 1.5 million for its tech investment platform
- Sustainable Venture’s Sustainable Accelerator raised over £ 1.6 million in February. The fund invests in startups tackling climate change.
See: Equity Crowdfunding Growth: It Took UK Seedrs 8 Years to Raise the First £1Billion and Only 2 Years for the Next Billion
- Also February: Seedrs also provided an update on its Secondary Marketplace, which continues to grow. Seedrs reported that Fintechs and the Food and Drink sector were the most active trading segments. Approximately 306 issuers traded shares representing a 38% increase in sales in comparison to January 2023.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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FCA Publishes Findings of “Early and High Growth Oversight” Review
FCA | March 10, 2023
Image: Unsplash/Agefis
Following a successful pilot, we’re expanding Early and High Growth Oversight, providing closer support for 300 newly authorised businesses by the end of 2022/23.
- Firms can face challenges in meeting their regulatory obligations in the first few years after authorisation. In response, we have initiated a new approach called Early and High Growth Oversight. This provides enhanced supervision for firms as they get used to their regulatory status and supports them to understand their obligations so they can meet the standards we expect as they grow. It will also ensure that we can identify and address harm developing in newly authorised firms quicker.
- During 2021-2022, we conducted a multi-firm review of 25 FCA solo-regulated firms which had experienced fast growth over a 3-year period. We assessed the impact of this rapid growth on their financial and non-financial resources. The review was based on business plans, internal capital adequacy assessment process (ICAAP) documents, wind-down plans and other documents submitted by firms.
See: Linklaters: Crypto and DeFi: Understanding the Risk Landscape and Tackling the Shifting Outlook
- We saw that for most firms:
- Their risk management framework and governance arrangements (including staffing in second and third line of defence) have not kept pace with the growth in their business activities. While risk management practices at these firms may have been proportionate at authorisation, they had not evolved to scale with the business. This can result in an increased risk of poor outcomes for consumers.
- Firms’ assessment of the adequacy of financial resources did not consider the growth in their underlying business resulting in financial resources assessments that were not commensurate with the size, business model and underlying risks. This can affect the financial resilience of firms, increasing the risk of disorderly firm failure.
- Wind-down plans were inadequate following the fast growth of these firms, increasing risk of harm in the event of firm failure.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Investment Crowdfunding for Retail Investors
MoneyWise | Barry Choi | Feb 28, 2023
Image: Freepik/rawpixel.com
Equity crowdfunding platforms are becoming more common in Canada, and it’s allowing everyday investors to own part of the action that was once reserved to accredited investors.
- With equity crowdfunding, a large number of investors can contribute to a business via platforms like FrontFundr or Equivesto. When investors contribute to a business through an equity crowdfunding portal, they receive a stake in the business. Equity crowdfunding allows start-ups to raise funds without loans, while investors are able to gain equity in a company for a fraction of the price of a traditional buyout. With equity crowdfunding, Canadian start-ups are allowed to raise up to 1.5 million dollars during a 12-month period.
- In Canada, the investment limit for retail investors in equity crowdfunding depends on the province where the investor resides and the type of securities being offered. Generally, the investment limits for equity crowdfunding for retail investors in Canada are as follows:
- In British Columbia, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, and Prince Edward Island, the investment limit for retail investors is $1,500 per offering, with a maximum of $5,000 per year.
- In Ontario, the investment limit for retail investors is $2,500 per offering, with a maximum of $10,000 per year.
- In Alberta, the investment limit for retail investors is $5,000 per offering, with a maximum of $30,000 per year.
- Investors can invest in multiple offerings as long as they don't exceed the annual investment limit for their province. Additionally, some provinces may have different rules for accredited investors, who have higher investment limits due to their higher net worth or income levels.
See: Hardbacon: Why we launched an equity crowdfunding campaign in the middle of a bear market
- Equity crowdfunding doesn’t only make it easier to contribute to individual companies, some view it as a key to giving consumers more economic power.
- Getting funding can be essential for entrepreneurs to survive, but not all companies will qualify for crowdfunding platforms.
- Risk Reward: There’s always a chance that the company you invest in fails, causing you to lose your investment. This is a risk with all investing, but is more likely for start-ups and early-stage businesses.
- Real estate Crowdfunding: Companies such as Willow and Addy split properties into equal shares and make them available to the public. If they buy a property for $500,000 it could then be split into 500,000 units. That means you could own a part of a home for as little as $1.
- Once you purchase a share, you get a proportionate share of rental income.
- You can also get paid if the property is sold for profit.
- Not only do you get fractional ownership in a property, but you don’t have to deal with lawyers, realtors, or land transfer taxes when selling your units.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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