Coined as the “modern-day capital raising”, crowdfunding refers to financing a venture through the collective effort of casual investors.

Last year, the sector got a regulatory green light after the government ruled crowd funding mechanisms could be extended to private companies.

And there’s already a number of platforms in the Australian market, providing a vehicle for early-stage startups to raise money from retail investors.

But crowd funding platforms aren’t the only vehicle for investors looking for opportunities outside of traditional listed stocks.

As the ecosystem for private capital markets continues to grow, there’s a number of players in the market linking companies with potential investors.

Here’s an overview from Saki Partners of five of the top current platforms, and how they’re offering shapes up in the current market place:

Equitise

Equitise delivers a platform for investing in early stage unlisted companies in exchange for shares in the company. Therefore, as a shareholder if the company is a success, the investor stands to profit off their equity stake.

Equitise is one of the big players when it comes to crowdfunding investments, currently holding the record for the second largest amount raised for a business start-up in Australia. Xinja participated in a retail equity crowdfunding scheme for 69 days.

During this time, Equitise’s ‘crowd’ managed to fund $2.4 million spanning over 1,222 investors. This achievement exemplifies Equitise’s capability to source capital for any start-up business looking for financing.

Equitise has successfully run 13 retail deals, 11 wholesale deals, and 8 IPOs and has helped raise equity for early stage businesses across a diverse range of industries, raising over $9 million in 2018 alone”.

To sum it up, we believe that Equitise is a sure thing for start-up growth companies to obtain financing. In terms of a proven track record, you can’t get much better than Equitise in the Australian market.

Moreover, they manage all documentation, administration and payment for both investors and businesses, taking the hassle out of a traditional capital raising process. Their website looks slick and sophisticated, and with easy to use navigation features, it’s hard to look past Equitise.

Birchal

Birchal has reach to 610,000 members and claims to have transacted over $70 million for those seeking financing. The company has tailored its service offering by centralising the investment process, making it simple and fast for both investors and firms.

What we love most about Birchal is its website layout. The crowdfunding solution boasts a slick modern design, allowing users and campaigners to easily navigate through. Companies are able to create a beautiful ‘web-designer style’ page within minutes.

Its eye-catching aesthetic will be sure to grab a potential investor’s attention. Its beautiful appeal heralds Birchal as one of the better pitching decks to share around with others.

Its platform design is top notch, and we believe that Birchal has some serious potential going forward as it competes with the other early-adopter crowd funding platforms for market share.

Venture Crowd

Venture Crowd is an equity crowdfunding platform offering investors the opportunity to invest in high growth private companies. The business has raised a collective $23 million and has funded 45 deals since its inception. Venture Crowd differentiates itself to other crowdfunding competitors by being Australia’s only multi-asset class crowdfunding platform.

Like Birchal, it’s web design and pitching deck for investors is slick, stylish and sophisticated, registering it as one of the best in terms of presentation. Venture crowd has a proven track record, having hosted several successful deals since their establishment. Their first crowdfunding start-up exit gave investors back 107%.

Since then, the platform has continually facilitated several successful raises, highlighting its reliability for those looking to gain funding. We reckon Venture Crowd is a safe option for business ventures and view it as a trusted brand in the market place.

OnMarket

Rivalling Equitise, OnMarket is a powerhouse in Australia’s crowdfunding industry. The company claims to have raised the most capital, for businesses than any other platform in Australia ($71.4 million). OnMarket mirrors Equitise’s model for which investors fund early stage unlisted companies in exchange for shares in that company.

OnMarket’s position in the marketplace is evidenced by its participation in the crowdfunding raise for DC Power Co. DC Power was able to raise $2.1 million through OnMarket’s platform from a whopping 14,950 investors, labelling it the world’s most popular equity crowdfunding offer.

With that sort of spread, it’s evident that OnMarket is one of the most successful crowdfunding spaces for start-ups in Australia. Similar to Equitise, OnMarket offers a fully automated distribution, payment and allocation process for its users.

Moreover, the platform regularly partners with investment funds, brokers and specialist advisors in the financial industry.

Primary Markets

When you ask a financial professional about crowdfunding in Australia they will tell you about Primary Markets. There is little doubt that this platform is well aligned to the professional and sophisticated investors.  Primary Markets is a global marketplace facilitating secondary trading of existing securities and investments.

However, they are also well known for their ability to raise new funds for unlisted companies. Incorporated in 2009, PrimaryMarkets has an investor network database of over 50,000 people and has traded more than $81 million worth of securities.

Surprisingly, PrimaryMarkets doesn’t have the same aesthetic appeal like other crowdfunding platforms do. The website feels clunky and the capital raising page looks subpair and unattractive.

Nevertheless, the company has a proven track record in raising capital on secondary markets, providing a platform for many successful business ventures, boasting their professional experience in the crowdfunding industry.

Former fund manager and finance academic, Dr Nigel Finch advises growing business on strategy execution, corporate governance and capital raisings. He has worked across all stages of the business cycle from start-ups to seasoned ASX-listed companies including many who have tackled Asia’s emerging markets. Authoring more than 5 books and 100 scholarly articles, Dr Finch has a thing or two to say about business.

If you have a private deal you think we should know about, get in touch with us at [email protected]
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.