Regulation Crowdfunding (Reg CF) has topped $1 billion – five years after the securities exemption became actionable for issuers in need of growth capital.
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
Alberta Securities Commission adopts small business finder’s exemption | Proposes Corporate Opportunity Waivers
Investment Executive | Nov 10, 2021
The Alberta Securities Commission (ASC) has adopted a new registration exemption for finders to help startups and other small businesses in the province raise capital, the regulator said in a release on Wednesday.
The small business finder’s exemption — proposed in March of this year by the ASC, and effective Nov. 10, 2021 until Nov. 11, 2024 — is intended to help small businesses use finders to raise money. Finders can be individuals or wholly owned companies owned by individuals, the regulator said in its notice, citing feedback it received from commenters.
See:
ASC and FCAA adopt new prospectus exemption to support small business capital raising
ASC Updates Raising Capital for Small Businesses Resource: Fostering Alberta’s New Economy
The new rule replaces the so-called Northwestern exemption, providing a more targeted exemption from the dealer registration requirement for finders.
The new exemption also includes a number of conditions and better integrates with prospectus exemptions that small businesses in Alberta can rely on, the release said. And, it specifically targets businesses raising less than $5 million.
“We recognize that it can be very difficult to find a registered dealer that is willing to help raise money for financings under $5 million,” Stan Magidson, Chair and CEO of the ASC, so this exemption “allows small businesses to use finders to help them identify potential investors, as long as they adhere to specific conditions.”
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Edmonton Journal | | Nov 15, 2021
Alberta could become the first province in Canada to offer corporate opportunity waivers as part of new proposed amendment
Proposed amendments to Alberta’s Business Corporations Act would make it easier for directors of private corporations to be involved with multiple related businesses and investments at the same time.
Under the proposed amendments, tabled in the legislature on Monday, Alberta would become the first jurisdiction in Canada to allow corporations to create “corporate opportunity waivers” which set out rules for when directors can be involved in multiple related projects.
See: With $73 million CAD, Symend closes one of the largest Series B rounds in recent Alberta history
Service Alberta Minister Nate Glubish said that often when private equity funds make a large investment in a company they will request a seat or two on the board. At the same time, it is not uncommon for members of these funds to be involved in multiple related businesses that they have an expertise in, he said.
Under the status quo, directors would need permission from the original company they invested in before they could take on another project.
“What the concept of a corporate opportunity waiver would do is it would allow for that company who’s raising that capital to say … we can give you a very narrow and well defined waiver that says in what circumstances you could go in and make these other investments,” Glubish said.
Speeding up the process is a way to attract more business and investment to Alberta, Glubish said.
“The key thing for me is to say, well, as a government we want to try and give Alberta companies as many tools as possible to attract as much capital as possible, especially if they’re attracting it from outside of Alberta. If not having access to corporate opportunity waivers puts certain private equity or venture capital funds out of reach for them, then we’d like to give them this tool,” he said.
While Alberta would become the first jurisdiction in Canada to offer these kind of waivers, similar legislation exists in some parts of the United States.
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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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Harmonized European Crowdfunding Rules Kickoff Allowing up to €5 million
Crowdfund Insider | | Nov 11, 2021
Harmonized European crowdfunding laws commence today (November 10, 2021). After years of engagement by industry leaders, largely due to the efforts of EuroCrowd, issuers may now utilize investment platforms to sell securities across all EU member states.
The European Crowdfunding Service Providers Regulation (ECSPR) rules allow platforms to be licensed at the member state level but issue securities to investors across the EU. Companies may raise up to €5 million. Prior to ECSPR, issuers could raise money across different countries in Europe but also had to manage a diverse set of regulations thus adding unnecessary friction to the funding process.
See: 3 Trends in 2022 Predicted to Shape Investment Crowdfunding
The EU explains:
“The EU market for crowdfunding is underdeveloped compared with other major world economies. For many years, one of the biggest hurdles faced by crowdfunding platforms seeking to offer their services across borders has been the lack of common rules and diverging licensing requirements across the European Union. This has resulted in high compliance and operational costs, which prevented crowdfunding platforms from efficiently scaling the provision of their services. As a result, small businesses had fewer financing opportunities available to them and investors had less choice and faced more uncertainty when investing cross-border.”
Many years in the making the new rules are expected to “increase the availability of this innovative form of finance, which will help companies seeking alternatives to bank financing.
Platforms and issuers must adhere to a set of requirements including disclosure and investor protection rules.
While the harmonized rules are actionable today for providers, final rules are still pending following a consultation by the European Securities and Markets Authority (ESMA) that is slated to reveal more granular details in May of 2022. It is not immediately clear as to when the first offering will be listed under ECSPR.
See: UK Crowdfunding Association Comments on FCA Dear CEO Letter Sent to Platforms
As it stands at the moment, ESMA must create 12 technical standards and 8 regulatory technical standards as well as 4 implementing technical standards.
Details outstanding include:
- Complaint handling;
- Conflicts of interest;
- Business continuity plan;
- Application for authorisation;
- Information to client on default rate of projects;
- Entry knowledge test and simulation of the ability to bear loss;
- Key investment information sheet;
- Reporting by crowdfunding service providers to NCAs (and NCAs to ESMA); and
- Publication of national provisions concerning marketing requirements.
See: European Banking Authority Adressing Crowdfunding and Money Laundering, Terrorist Financing Risk
ESMA has already published a Q&A on special purpose vehicles (SPVs) an important clarification that makes it easier for issuers to manage shareholders and platforms to facilitate transactions. Draft technical standards may be viewed here.
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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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3 Trends in 2022 Predicted to Shape Investment Crowdfunding
Crowdfund Insider | | Nov 1, 2021
Investment crowdfunding took off when the JOBS Act regulation went into effect back in 2016 and has become a booming industry in short order. We saw some significant regulatory changes in March of this year, with the Securities and Exchange Commission (SEC) confirming capital formation increases for Reg A+ and Reg CF. These increases solidified just how impactful this type of crowdfunding can be.
Equity crowdfunding has garnered trust and legitimacy from issuers, investors, broker-dealers, transfer agents, and lawyers—and raised $239 million via Reg CF and $1.6 billion via Reg A+ in the first half of 2021. Today, there’s nearly $800 million invested across 64 FINRA-licensed Reg CF funding portals.
Significant, positive economic ripple effects from equity crowdfunding
When it comes down to it, what 2020 and 2021 have clearly shown us is that investors want to participate in and support small businesses.
See: Doug Ellenoff on US Reg CF Increasing Issuer Caps to $5 million: Investment Crowdfunding Will Challenge Traditional Venture Capital
At my firm, we’ve seen 4,000+ issuers to date, including startups, small businesses, and medium-sized businesses. These SMEs are choosing equity crowdfunding instead of traditional, bank-led financing because they can control their offering and financing needs. No longer beholden to the mercy of a single small business banker with specific credit appetites, or a venture capital firm with narrow funding parameters, these entrepreneurs are now in the driver’s seat and their customers and supporters are riding shotgun alongside them.
Currently, the top five industries for issuers are software, distilleries and breweries, restaurants, internet and e-commerce, and movies, according to research from Crowdfund Capital Advisors. Ironically, all industries are significantly impacted by COVID. But investors in these spaces are eager to participate in crowdfunding for their favorite businesses, and in 2020 venture capital was particularly difficult to come by. The world watched as so many of our favorite restaurants, venues, and small businesses closed because they didn’t have the financial ability to stay afloat. But equity crowdfunding presents a chance for those businesses to get back in the game.
As we forge ahead into 2022, the impact of equity crowdfunding for COVID-affected small businesses will play out with positive ramifications in local economies by creating not only capital for businesses, but creating jobs as well. 120,000 local jobs have been created so far in 2021 as a result of successful Reg CF offerings, reported Crowdfund Capital Advisors. These salaries support government taxes, consumer spending, savings, and more. They’re supporting our communities and keeping food on our neighbors’ tables.
See: Reg CF: Investment Crowdfunding Tops $1 Billion on Heals of Funding Cap Increase
Accessible crowdfunding for all
As we move into 2022, the equity crowdfunding industry will continue to build a foundation for underserved people to gain access to the financial system in terms of meaningful investments. Anyone—regardless of social status or annual income—should be able to begin investing in companies that hold meaning for them. It’s about radical accessibility and execution. Looking to the future, we’re building a system that allows for more equal access for both the issuer and the investor.
Whereas only 1.2 percent of the venture capital invested in U.S. startups in H1 2021 went to Black founders, and just 2.3 percent to women in 2020, women and people of color make up 40 percent of issuers using Reg CF.
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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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Reg CF: Investment Crowdfunding Tops $1 Billion on Heals of Funding Cap Increase
Crowdfund Insider | | Oct 26, 2021
Regulation Crowdfunding (Reg CF) has topped $1 billion – five years after the securities exemption became actionable for issuers in need of growth capital.
According to Crowdfund Capital Advisors (CCA), 1.2+ million investors have backed over 4500 companies to achieve this milestone.
The third quarter of 2021 was said to be the best quarter ever with approximately $148 million committed to issuers raising capital on funding portals or regulated broker dealers.
See: Reg CF Update: Interview with Sherwood Neiss on Investment Crowdfunding
This amount was 93% greater than the same quarter last year and 12.5% over Q2. The third quarter broke the record of number of offerings pegged at around 400 securities sales.
Year to date as of Q3, approximately $409 million has been raised with 1,177 individual offerings.
Software was the most popular industry to raise money using the exemption.
The top five platforms during Q3 dominated the sector of online capital formation accounting for around 88% of investment activity.
CCA noted that Reg CF activity helped to create more than 17,000 jobs during the quarter.
See:
Doug Ellenoff on US Reg CF Increasing Issuer Caps to $5 million: Investment Crowdfunding Will Challenge Traditional Venture Capital
Canadian securities regulators adopt new nationally harmonized start-up crowdfunding rules
This sector of crowdfunding received a significant boost in March of 2021 when the Securities and Exchange Commission made several material changes to the securities exemption. Perhaps the most important change was boosting the funding cap from $1.07 million to $5 million thus making the exemption more viable for a broader range of early-stage firms.
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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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VCs are becoming modern-day investment banks
Sifted | Nicolas Colin | Oct 13, 2021
These days, a closely watched phenomenon is the growth and diversification of Andreessen Horowitz, one of the most prominent venture capital firms in Silicon Valley. Not only is it hiring new partners and employees by the dozens, but it is also expanding its approach to the market, going well beyond the usual artisanal approach of early-day venture capitalists.
For a long time, such firms would simply sign a cheque in exchange for equity at a given stage — whether seed or Series A or beyond. Now some of them are doing much more than that: investing across various stages, exploring new geographies and designing new financial instruments to adjust their offering to the specific needs of startups in sectors such as crypto, real estate, healthcare, financial services and others. It makes sense because, more often than not, startups now need more than just equity: they also need debt financing, working capital, structured financial products, access to specific counterparties and more.
See: European Government Funds May Get Distributed by European Crowdfunding Platforms
If we look a bit more broadly, we see that this model already exists: it’s called an investment bank! Financial behemoths such as Goldman Sachs, Morgan Stanley and JPMorgan effectively act as one-stop shops for their clients. They provide equity capital, debt capital, asset management, liquidity, sophisticated risk management, market research and opportunities for mergers and acquisitions.
If a single firm can do it all for its clients, then there are economies of scale on both sides. The more capital providers you’re connected with, the more you can tailor your offer to your clients’ specific needs. In the other direction, the more clients you have, the more you can market your portfolio of opportunities to those who can provide capital. And you can already spot these networks at work in the tech world.
It is logical, then, that the most successful VC firms are slowly morphing into a new breed of investment banks — gatekeepers of the capital markets for tech startups and tech companies.
“The most successful VC firms are morphing into a new breed of investment banks — gatekeepers of the capital markets for tech startups”
What today’s startups need
Compared to the tech businesses of the past, today’s startups do have more diverse needs. For example, the rise of revenue-based financing, dominated by the likes of Pipe, Capchase, and Uplift1, has made startups offering SaaS products realise that they could fund part of their endeavour with non-dilutive debt capital rather than costly equity capital. Could the same investment firm provide the equity capital to kickstart the venture and then the debt capital to fund its growth once revenue flows? American VC General Catalyst sure thinks so.
Read: Doug Ellenoff on US Reg CF Increasing Issuer Caps to $5 million: Investment Crowdfunding Will Challenge Traditional Venture Capital
On the other hand, those with capital on their hands feel that technology is where you can enjoy outsized returns over the long term; therefore, they’re seeking more exposure. As they realise it’s not always easy to access the best deals, maybe they’ll start thinking about trusting an investment bank with large amounts of money to be deployed across its client portfolio to generate the best returns.
It is no coincidence, then, that indexing, a concept long confined to the stock market, is becoming more visible in venture capital (see John Luttig here, and Tomasz Tunguz here). Instead of chasing a few deals a year, just trust a large, established firm with your money and let it index it on the entire tech market! A traditional VC firm can’t do that, but an investment bank does.
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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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Alberta and Saskatchewan securities regulators adopt new small business financing prospectus exemption
Calgary – The Alberta Securities Commission (ASC) and the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) today adopted a new prospectus exemption designed to facilitate greater access to capital for Alberta and Saskatchewan businesses.
“This exemption joins the self-certified investor prospectus exemption adopted in March 2021, and is the next step in our broader efforts to support innovation and diversification in our provinces,” said Stan Magidson, Chair and CEO of the ASC. “This initiative is intended to address challenges faced by small and early stage businesses in accessing capital, while still addressing investor protection,” added Roger Sobotkiewicz, Chair and CEO of the FCAA.
The new small business financing prospectus exemption allows Alberta and Saskatchewan businesses to raise up to $5 million from the public using a simple, streamlined offering document. The exemption has tiered offering limits depending on whether financial statements are provided to investors.
See: Canadian securities regulators adopt new nationally harmonized start-up crowdfunding rules
To mitigate the risks to investors, investments are limited, with higher limits possible if financial statements are provided or if the investor either has a certain minimum income or has received investment advice from a registered dealer. The investment limits do not apply to investors who qualify to invest under certain other common prospectus exemptions.
The exemption is being implemented on a three-year pilot basis. Details of the new exemption are set out in CSA Multilateral Notice of Implementation 45-539 Small Business Financing available on the websites of the ASC and the FCAA.
The CSA, the council of the securities regulators of Canada’s provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.
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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Crowdcube partners with Seccl to shake up IPO market
Seccl | Dan Marsh | Jun 24, 2021
It’s official: Crowdcube, the leading equity crowdfunding platform, has chosen Seccl to provide customers with seamless, API-based access to public markets, as it sets its sights on launching a Community IPO product later this year.
Having facilitated over £1 billion in crowdfunding investment campaigns since it launched ten years ago, Crowdcube is no stranger to democratising investments. Its Community IPO product is the next step in that journey, promising everyday retail investors an opportunity to get a piece of the IPO action.
As a result, the leading fintech will now be able to offer retail investors the most diverse set of equity investments anywhere in Europe, enabling investors to back businesses from start-up to IPO alongside VCs and institutions.
See: UK Equity Crowdfunding platforms Crowdcube and Seedrs to merge
It’s a super exciting development, and we’re delighted our technology will help make possible. By integrating with our custody, trading and settlement APIs, Crowdcube will be able to build on its existing secondary marketplace – Cubex – to create a seamless all-in-one experience to power retail participation on a mass scale.
Why Seccl?
Despite all the hard work innovative fintechs like Crowdcube are doing to democratise investments, everyday retail investors are still getting left out when it comes to Initial Public Offerings (IPOs).. Now, Crowdcube want to change that – and we’re completely onboard.
As Sam Lawson, Crowdcube’s VP of Capital Markets, puts it: “We have real alignment with Seccl on our vision to disrupt public markets, at first allowing retail investors fair access to IPOs. Together we have the right technology to include retail investors in a seamless and customisable way.
FFCON21 Video: European Crowdfunding Leaders - Lessons & Outlook from the First €1 Billion Raised
“The quality of Seccl’s team and solution is exactly what we need as we embark on our next step to democratise primary investment in the public markets, and double down on our mission of supporting entrepreneurs, from inception to IPO.”
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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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