From gin to soccer balls, equity crowdfunding is growing in Australia
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At least 25 equity crowd-funding projects have launched in Australia since new funding laws came into effect in January.
Equity crowd-funding laws were passed last year, allowing public companies to raise up to $5 million and individual investors to chip in as much as $10,000 per company.
Another dozen or so have issued prospectus information and expression of interest forms in the hope of launching offers soon.
It’s not yet known how much Australians have invested — but the figure is in the millions, divvied up into more than 25 equity crowdfunding rounds.
More business ideas are being added to fundraising platforms each day.
Many of the businesses on offer differ from typical ASX-listed offers.
Among others, investors are right now being invited to own a small piece of an independent gin brewer, a soft drink startup, an early stage fintech disruptors and a small sporting goods producer.
Digital bank disruptor Xinja completed Australia’s first equity crowdfund raise in March, securing $2 million.
At this stage, it’s not unusual for companies to ask investors for millions for everything from product line expansion to new projects and working capital to expand nationally or globally.
Here’s a look at some of the ongoing equity crowdfunding campaigns this month:
Offer: Shares at $1 each, looking to raise up to $750,000 this round. $215,000 raised so far
Expires: June 30
Social enterprise Park is days from completing its funding campaign and already has $220,000 in the kitty after offering shares at $1 each to a maximum of $750,000.
The business, co-founded by former Apple creative director Sam Park, is a sports and lifestyle brand that produces soccer balls and clothing equipment and has a blueprint to provide sporting goods to communities in need.
Park has already reached its minimum investment pool of $200,000, so all funds pledged so far will be invested in the business up to the $750,000 mark.
Offer: Shares at $1 each up to a total investment target of$1.2 million. This will contribute to a $6m series A round.
Expires: Accepting investments until June 30.
Sugar-free soft drink operator Nexba is about 80 per cent of the way there to reaching a $1.2m investment target, with its equity crowdfunding raise contributing to a $6m series A funding round.
This is a wholesale investor offer with shares offered at $1 each. Investors River Capital and former David Jones chief executive Paul Zahra have already invested with Nexba, and a range of lead investors have so far contributed $2.6 million to the series A round.
Those taking part in this raise are invited to help secure the growth of the business. The company, which has distribution deals for its drinks through the major supermarkets and restaurant chains like Domino’s, is in the final stages of negotiations with a major UK retailer for distribution in the UK.
Offer: Shares at 25c to raise up a minimum of $500,000 and maximum of $3.5m. Minimum investment $500.
Expires: Expires July 17.
Want to own a gin business? Perth spirits maker West Winds started as an engineer’s hobby project and has so far raised $682,000 from crowdfunding investors through a campaign that ends next month.
West Winds is happy to take up to $3.5 million from investors at 25c a share, up to 14m shares.
The funds will help expand the reach of its nautical-themed gins, including The Cutlass and The Sabre, as well as going towards marketing and capital expenses.
Offer: Shares at $1.41 to raise up to $1.5m. $800,000 raised so far
Expires: Ends June 27.
This one’s only open to sophisticated investors, but $896,000 has so far been poured into car booking business GoCatch as part of a pre-IPO capital raise. The company lets app users book and settle private hire car and cab rides up to the size of a minibus and is aiming to become the first app-based transport startup to break even in the next year.
The company wants to raise up to $1.5m at $141 a share, with the minimum buy-in at $4,935. The business generated $1.3 million in revenue in the nine months to March 2018, and spent $2.1 million on operating expenses.
A number of companies are also teasing plans for equity crowdfunding raises in coming weeks and months, with at least ten unlisted companies announcing expressions of interest will open soon for their raises.
Investors will have to wait until offers open for exact details of the raises, but here are four disruptive businesses who’ve put their plans on the table:
This cinema platform is inviting potential investors to register their interest on the Equitise platform for an upcoming crowdfunding raise. Choovie is a demand-based cinema ticket platform that connects users to cheap movie tickets by selling empty seats at a deep discount.
A professional Esports team is calling on investors to “join the army”, listing on the Birchal platform for an upcoming raise. A startup hoping to capture a slice of the $1.7 billion esports market, Order is has set up teams to compete in League of Legends and Counter Strike competitions, with teams in more Esports codes to come.
On the property sector front, mortgage Joust has launched investment expressions of interest via OnMarket. Joust connects home buyers directly with lenders via its platform, letting providers fight it out to offer customers the best interest rate on mortgages.
Fintechs are also getting in on the equity crowdfunding action. Payments startup Pelikin is building a banking app and payments card that can be used anywhere in the world without incurring additional fees. It’s listed an upcoming crowdfunding raise on Birchal to contribute to the development of the product, which is soon to enter private beta mode.