UK Government Ups Crowdfunding without Prospectus to €8 Million – Matching Germany
Crowdfund Insider | | Jul 2, 2018
In a significant policy move by the UK government, the threshold for investment crowdfunding has been upped to €8 million thus matching the recent change by Germany which announced the same funding limit. This increase is due to a change in the Prospectus Directive.
In the UK, there is no limit on how much a crowdfunding platform may raise online. But a rule requiring a full blown prospectus at €5 million has, in effect, created a significant speed bump for investment crowdfunding platforms – one that has rarely been breached due to the cost of creating and complying with a prospectus requirement.
The change announced today, should have an important impact on UK crowdfunding platforms as it will help make the online capital formation industry far more viable as issuers seek larger funding amounts raised via the issuance of securities online. In the early days of UK crowdfunding most issuers raised smaller seed round amounts. Today, issuers span a far wider range of funding requirements from seed stage to scale up. Frequently, these offerings are done in partnership with professional investors such as VCs or experienced angels.
See:
-
Competition Bureau weighs in on fintech: urgent action required
-
NCFA Canada’s submission to Finance Canada (March 2018): Urgent Need for Regulatory Change and Government Support
The industry leadership organization, the UK Crowdfunding Association (UKCFA), welcomed the UK government’s decision to change the rule – a change that becomes actionable almost immediately – on July 21st.
Investment crowdfunding platforms, both debt and equity, have been increasing the scale and scope of investment offers with many platforms already consistently raising the maximum €5 million for SME’s and infrastructure projects in the UK. The extension is said to enable a new age of crowdfunding for larger businesses and tackle more significant infrastructure projects in a diverse sector of industry.
A spokesperson for the UKCFA shared a statement with CI:
“Our members are already working now on investment offers which could take advantage of this opportunity for larger, more efficient capital raising through investment based crowdfunding without compromising on levels of due diligence. The economics of the previous threshold no longer added up, creating a distortion in the market which has now been addressed. This means that a new sector of ‘scale up’ businesses will be able to benefit from the option of choosing crowdfunding as a route to funding their growth and success. It also helps maintain the UK’s competitive position as a great place to start and scale a business.”
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Read More
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Read More
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Read More
Read More
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Read More
Read More
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Read More
Read More
TechCrunch | Kate Clark | Sep 12, 2019 Affirm, founded by PayPal’s Max Levchin, is said to be raising as much as $1.5 billion in a combination of debt and equity, according to people with knowledge of the company’s fundraising activities. Josh Kushner’s New York venture capital firm Thrive Capital is said to be leading the financing, with participation from the San Francisco outfit Spark Capital. Affirm declined to comment. Representatives of Thrive and Spark, existing Affirm investors, have not responded to a request for comment. Sources familiar with Affirm, which gives consumers an alternative to personal loans and credit by financing online purchases at point-of-sale, presume the round will be made up largely of a line of credit from a large financial institution, known as a warehouse facility. Affirm recently raised a $300 million Thrive-led Series F round in April at a valuation of $3 billion. Fintech companies focused on payments and lending, however, require a vast amount of capital to sustain operations. Those capital requirements coupled with the frothiness of the venture capital market justify this additional cash infusion. To date, Affirm has raised $1.03 billion in funding from Ribbit Capital, Founders Fund, Andreessen Horowitz, Khosla Ventures, Lightspeed ...
Read More
Read More
Le Monde with AFP | Sep 12, 2019 Bruno Le Maire expressed his hostility towards this cryptocurrency project, saying that "the monetary sovereignty of states is at stake" Finance Minister Bruno Le Maire announced on Thursday (September 12th) that France was refusing to authorize the development "on European soil" of libra, the cryptocurrency that Facebook wants to launch in 2020. "Considerable financial disorder" "The monetary sovereignty of states is at stake," said the minister at the opening of a conference of the Organization for Economic Co-operation and Development (OECD) dedicated to the challenges of cryptocurrencies - without specifying, however, what concrete measures he wanted engage to prevent the spread of libra in Europe. See: Facebook’s Libra Cryptocurrency: Everything We Know In his speech, Bruno Lemaire described as "systemic" the risks that could result from this "possible privatization of a currency (...) held by a single actor that has more than 2 billion users on the planet" . "Any failure in the functioning of this currency, in the management of its reserves, could create considerable financial disorders , " justified the Mayor, also fearing that the libra is replacing the national currency in the States where the currency is weak or ...
Read More
Read More
CNBC | Bob Pisani | Sep 10, 2019 Key Points The head of the SEC says more needs to be done to make it easier for companies to go public. Jay Clayton says his office is taking a “fresh look” at allowing Main Street investors access to the private capital markets. The head of the SEC says more needs to be done to make it easier for companies to go public and that his office is taking a “fresh look” at allowing Main Street investors access to the private capital markets. In a speech to the Economic Club of New York on Monday, SEC Chairman Jay Clayton said the lack of more IPOs and the inability of most of the Main Street investing public to access private markets was a “growing concern.” Clayton addressed what he called the “two segments” in capital markets: the public markets, and private ones, including private equity and venture capital investments. See: The Solution To The Fintech IPO Shortage “Twenty-five years ago, the public markets dominated the private markets in virtually every measure,” he said. “Today, in many measures, the private markets outpace the public markets, including in aggregate size.” Clayton wants to make the ...
Read More
Read More
Nesta UK | Rosalyn Old and Johnathan Bone | Sep 4, 2019 Earlier in May 2019, Nesta commissioned a report called 'Taking Ownership: Community Empowerment through Crowdfund Investments' that looked at how community-led projects have the power to transform local areas socially, economically and environmentally and how institutions such as local governments, municipal authorities and foundations, can help community-led initiatives by making the most of new investment crowdfunding models (eg community shares and bonds). Key Findings Investment crowdfunding has been used to fund a broad range of local assets, including but not limited to, saving local shops and pubs from closure, creating new community centres and art spaces, and expanding leisure facilities and infrastructure projects. Potential opportunities in using investment crowdfunding for community-led initiatives include helping to fund projects that would otherwise struggle to access finance elsewhere, increasing the use of and volunteering for community initiatives, and strengthening local resilience and self-determination by bringing communities together to improve their area. The main challenges for community organisations raising money in this way include gaining access to assets to buy or use on a temporary basis, transitioning from grassroots fundraising to implementing a project and avoiding negative impacts on diversity and inclusion ...
Read More
Read More
NCFA Canada on behalf of our partner's Lending Loop | Sep 11, 2019 HAVE YOU EVER SEEN A CHESHIRE CAT SMILE? Well they deserve it. Back in October 2015, NCFA made this introductory video with Cato Pastoll, CEO and Co-Founder of Lending Loop, about a peer to peer lending marketplace for small businesses model that was new to Canada but was achieving significant growth internationally. The question and opportunity was back then: why not here in Canada? A question that many of us ask ourselves, ask the community and point fingers at strict regulations and high operating costs. Well fast forward several years and growth obstacles later, and the Lending Loop story continues to impress with their latest milestone of lending over $50 million to deserving small businesses to help them grow and expand operations while providing retail and accredited investors direct access to a wide range of lending and investment options, a robust community and the chance to strengthen Canadian small business - here here! The early vision... Brandon Vlaar, Co-founder and CTO of Lending Loop sharing their good news! CONGRATS to the entire Lending Loop Team for achieving this latest milestone. We've 'got your back' and look forward ...
Read More
Read More
NCFA Guest Post | Sep 9, 2019 The world was shook when online money was first introduced. Some people didn’t like the idea. They’d prefer having something tangible, something that they can actually see and touch to use as currency. Some people were positive about the new experience. They believe that it can certainly make life more convenient. But hey, we’re now in 2019 and online currency is still widely in use. In fact, its uses have expanded way more since it was first introduced (read more). One of the most popular and controversial of its time was BTC or Bitcoin. Even without studying cryptocurrencies, you’ve probably heard this term once or twice before. You may have come across it in the internet or someone may have encouraged you to try trading it. After all, when cryptocurrency was first brought to light, many people saw its potential in the trading market. And it has been making noise ever since. See: New Regulatory Framework for Canadian Retail Payments Coming in 2019 At first, Bitcoin was surrounded with a lot of controversy – and of course, a lot of doubt. People were scared of exchanging real world money for something that you ...
Read More
Read More
The National Crowdfunding & Fintech Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with cryptocurrency, blockchain, crowdfunding, alternative finance, fintech, P2P, ICO, STO, and online investing stakeholders globally. NCFA Canada provides education, research, industry stewardship, services, and networking opportunities to thousands of members and subscribers and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding and fintech industry. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: ncfacanada.org
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