By Paul Niederer, Founder Raiseworth. (Here is a post from 2015 when I started pushing for Crowdfunding to be moved to the Blockchain) If I go back to 2008, in the very early days of Equity Crowdfunding, the ASSOB platform has already been operating for around four years. This meant there were plenty of learnings in place even before any other equity platforms had started. There are parallels here with ICO’s as in the early days many people that approached us to raise capital on ASSOB had not much more than an idea or a sketch on paper. We learnt as the years went by that the existing regulatory structure was not detailed enough to protect investors so we put in place the ASSOB compliance framework. This stood the test of time as 300 odd raises later no evidence of fraud has emerged. This included an “offer document” not dissimilar to the “White Papers” that set out all aspects of the raise including: OPPORTUNITY KEY DETAILS KEY INVESTOR HIGHLIGHTS EXECUTIVE SUMMARY ABOUT THE COMPANY CORPORATE OBJECTIVES COMPETITION & RISK ABOUT THIS OFFER HOW TO APPLY FOR SHARES OWNERSHIP STRUCTURE STRATEGIC GROWTH PLAN USE OF FUNDS DIRECTORS DECLARATION DISCLAIMER GLOSSARY OF TERMS This was not […]
Wednesday, October 4, 2017 (10:00 AM) – Committee on Financial Services Hearing: “Examining the SEC’s Agenda, ICO’s Crowdfunding, Operations, and Budget”
By Navroop Sahdev Centre for Blockchain Technologies, University College London, UK Centre d’Économie de l’Université Paris-Nord, France June 2017 Table of Contents 1. Introduction 2. The Advent of Crowdfunding 3. Market design and Liquidity Considerations for CFE Trading on the Blockchain 3.1. Liquidity and Price Discovery 3.2. A game of Information 3.3. Asset Servicing and Voting 3.4. Market Making versus Tokenization 3.5. The impact of Transparent Holdings 4. Concluding remarks 5. Endnotes 6. References CLICK HERE FOR FULL REPORT Abstract Blockchain, the technology behind Bitcoin, promises to be nothing less than Internet 2.0. The financial services industry, in particular, is preparing for the disruption blockchain/distributed ledger technology promises to cause. In the current business environment, the majority of startups and small businesses have to look for alternative sources of funding given that ‘going public’ is increasingly expensive. The crowdfunding space has seen tremendous growth as an alternative way to raise capital by businesses. However, these crowdfunded shares cannot be traded for 7 – 10 years on average on any given platform in the U.S. currently. To build a trading platform on the blockchain which is completely P2P, immutable, fully transparent and low-cost presents some key design issues. […]
By: Sherwood Neiss and Jason Best, Principals Crowdfund Capital Advisors, LLC Into the second year of Regulation Crowdfunding there are now over 475 companies that have filed offering documents with the Securities and Exchange Commission (SEC) to raise up to $1,070,000 from their customers, communities, friends and family. But in which industries are these investors most interested in deploying their capital? The good news for companies considering using Regulation Crowdfunding, is that these online investors have a diverse appetite. While software/gaming application companies receive the most commitments, breweries, entertainment companies, personal transportation vehicles, restaurants and personal services (i.e. fitness training, veterinary, grooming, etc) aren’t far behind. They key data points for potential issuers to understand are: 1) How much money do you need to raise for your business in relation to the average amount raised for your industry? 2) Where is the crowd is engaged in deals and dollars? Meaning is there enough interest in your business (industry) to crowdfund. And 3) what is the crowd’s average check size – to determine how much you can realistically raise from your network compared with what you need? At Crowdfund Capital Advisors, we track all Regulation Crowdfunding offerings across the […]
by Brandon Raatikka According to FactRight’s tracking, the SEC qualified 21 Reg A+ Tier 2 offerings in the second quarter of 2017, maintaining a brisk pace by the standards of Reg A+’s relatively short history. Approximately 45% of the 96 Tier 2 offerings qualified since late 2015 (not later withdrawn or used for merger purposes) have been qualified in just the first half of this year. Three issuers made headlines in June 2017, when each listed common equity (that had been previously issued under Regulation A offerings) on a national securities exchange: Myomo, Inc. (NYSE: MYO), Adomani, Inc. (Nasdaq: ADOM), and ShiftPixy, Inc. (Nasdaq: PIXY). In the wake of successful public listings, it will be interesting to see whether a growing proportion of issuers will seek to use Regulation A as a stepping stone to becoming a fully public company. Interact with FactRight’s database through the charts below to glean additional insights about the state of the Regulation A space through the second quarter of 2017. The charts below are dynamic; if you click on a single data point in any chart, it will filter the data displayed on the sidebar at left and in the remaining charts. (For instance, if you click […]
By Trudy-Anne McLeary, Associate, Corporate and Finance | Benjamin T. Brickner, Associate, Corporate and Finance In an investigative report and investor bulletin, the SEC concludes that offers and sales of cryptocurrency coins and tokens may be subject to federal securities laws. On July 25, 2017, the Securities and Exchange Commission (the Commission) released an investigative report with important implications for issuers and sponsors of initial coin offerings (ICOs) that raise funds for cryptocurrency ventures. The report, prompted by the recent proliferation of such activity, concluded that coins offered to purchasers in ICOs constitute securities regulated by the Securities Act of 1933 (Securities Act) and the Securities Exchange Act of 1934 (Exchange Act). As a result, absent an exemption, such offerings must be registered with the Commission, similar to other public offerings. The press release accompanying the report notably quotes the new Commission chairman and the new heads of the Corporation Finance and Enforcement divisions. This combined statement gives the report unusual weight and makes clear to Commission Staff that its contents describe senior officials’ current thinking on cryptocurrency regulation. Background In early 2015, The DAO, an unincorporated association, organized an IPO-style offering in which investors were offered DAO Tokens in exchange for Ether, a cryptocurrency […]
Crowdfund Beat News Wire, SEC issued an investigative report stating, “tokens offered and sold by a ‘virtual’ organization known as ‘The DAO’ were securities and therefore subject to the federal securities laws.” U.S. Securities Laws May Apply to Offers, Sales, and Trading of Interests in Virtual Organizations FOR IMMEDIATE RELEASE 2017-131 Washington D.C., July 25, 2017— The Securities and Exchange Commission issued an investigative report today cautioning market participants that offers and sales of digital assets by “virtual” organizations are subject to the requirements of the federal securities laws. Such offers and sales, conducted by organizations using distributed ledger or blockchain technology, have been referred to, among other things, as “Initial Coin Offerings” or “Token Sales.” Whether a particular investment transaction involves the offer or sale of a security – regardless of the terminology or technology used – will depend on the facts and circumstances, including the economic realities of the transaction. The SEC’s Report of Investigation found that tokens offered and sold by a “virtual” organization known as “The DAO” were securities and therefore subject to the federal securities laws. The Report confirms that issues of distributed ledger or blockchain technology-based securities must register offers and sales of such securities unless a valid exemption applies. Those participating in unregistered offerings also […]
Crowdfund Beat News Wire, Delaware Blockchain Initiative: Transforming the Foundational Infrastructure of Corporate Finance or much of American corporate finance is Delaware corporate law. Later this year, a small change to Delaware corporate law, if enacted, could facilitate a major simplification of the plumbing of the financial system built on top of that foundation. The change is part of the Delaware Blockchain Initiative (DBI), which then-Governor Jack Markell introduced in May 2016. The initiative will allow for the application of distributed ledger technology to many of the private sector’s most basic and critical legal documents, which companies currently file with the Delaware Division of Corporations. What Is Blockchain Technology? Blockchain technology, also known as distributed ledger technology, is a new type of information technology that combines two components: distributed ledgers and smart contracts. Distributed ledgers are mutual, shared ledgers. They create a single record of transactions among multiple parties, providing one immutable, “golden copy” of data that all parties see at the same time and can trust as valid. Consequently, parties do not need to maintain their own copies and reconcile with each other. Distributed ledgers are append-only databases that maintain a perfect, immutable audit trail of who did what […]
BY SARA HANKS , CrowdFundBeat Sr.contributing Guest Editor CEO/Founder,Crowd check.Inc. So, one year ago today, Regulation CF went into effect. Small companies can make offerings up to $1 million (recently increased to $1.07 million) and roughly 325 companies have made Reg CF offerings so far. Roughly 80 companies have filed Form C-U to notify the SEC of the conclusion of their offering (they can also use Form C-U to report progress of the deal, so the raw numbers need refining). Another 50 or so companies have taken advantage of the fact that the SEC tells us that multiple closings are permitted once a company reaches its target offering amount, and so have received funds but have ongoing offerings. We’re talking about modest success so far. Companies are finding it takes a while to raise the funds they are seeking and many offerings are still in progress, so overall success rates are going to go up in time. And several companies have had million-dollar raises. The less-encouraging story in in the area of compliance. By our calculation, by May 1 perhaps 100 companies should have filed annual reports under Form C-AR (all the companies which had filed C-Us by that date and […]
Watch: Jonathan Frutkin, Sara Hanks, Mark Roderick, Brian Korn @ Crowdfunding USA More Videos:
By Mark Robertson CrowdFundBeat Sr. Contributing Editor. President at CrowdDD, LLC, This is an open letter to all real estate sponsors. Investors want better reporting. Concise, short, informative, and easy to read reports. Unfortunately, most sponsors do poor job of communicating results with investors. I have over 50 equity crowdfunding investments and the quality of the quarterly reports varies wildly. The poster child for good reporting is Praxis Capital lead by Brian Burke. They have a one page report with graphs, relevant statistics, and a short write up of the past quarter’s results and commentary. They key features of their report are they inform the investor of the only 3 things investors truly care about. How much is MY distribution? What is the cash on cash return? What is it as a percentage of my investment? How does it compare to your projections for this quarter? The properties performance. Most importantly is the NOI. What is this quarters NOI compared to the projections made by the sponsor at the time of my investment? What is occupancy compared to both last year’s quarter and compared to projections? If actual distributions are below projections or if NOI is below projections, we want to know why. What we […]
By Mark Roderick CrowdFunding Beat Sr. contributing editor and crowdfunding attorney with Flaster/Greenberg PC. Cryptocurrencies are hot. And often the sale of cryptocurrencies is referred to as Crowdfunding. Unfortunately, the use of “cryptocurrencies” and “Crowdfunding” together creates confusion about both, along with some pretty serious legal risks. We use “Crowdfunding” to mean raising money for a business or other venture online. We say “donation-based Crowdfunding” when we’re talking about Kickstarter, where people ask for donations. We say “equity-based Crowdfunding” when we’re talking about raising money from investors, who receive a stock certificate or some other security. A cryptocurrency is, well, hard to pin down. It’s a transaction registered in a distributed, secure database. Because it exists in limited quantities and is secure, it has value. Like anything of value, it can be used as a currency. For purposes of this post, the key feature of a true cryptocurrency is that is has value of itself, like a nugget of gold. You use Crowdfunding to sell shares of stock. Obviously, the paper certificates representing the shares of stock have no value by themselves, they have value only to evidence ownership in the business that issued the certificates or, more exactly, in the cash flow the business is expected to generate. […]
Fincera Inc. (OTCQB: YUANF), a provider of online financing and e-commerce services for small and medium – sized businesses and individuals in China, has reported financial results for the second quarter ended June 30 , 2017. According to their numbers, loan transaction volume across both... Read More
Boston based law firm Block & Leviton has initiated an investigation into the Tezos Initial Coin Offering (ICO). Tezos raised about $232 million in one of the largest ICOs of all time several months back. Since the date of the ICO the price of Crypto... Read More
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FAT (Fresh. Authentic. Tasty.) Brands Inc., a global multi-brand restaurant franchising company, announced on Friday completed its Regulation A+ Initial Public Offering (IPO). The initiative, which raised $24 million throughthe sale of 2,000,000 shares priced at $12.00 per share, was launched earlier this summer and sought to achieve... Read More
Israeli fintech company PayKey announced on this week it has secured $10 million during its Series B financing round, which was led by MizMaa, with the participation of other investors including SBI Group, Siam Commercial Bank’s financial tech subsidiary Digital Ventures, SixThirty and FinTech71. This investment... Read More
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Fintech collaboration platform B-Hive recently announced the launch of its hub in New York City. According to B-Hive, the new hub aims to build a bridge between Europe and the Americas. Working with American-based players as well as EU-based participants makes our partners and members... Read More
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The inaugural FinTech Abu Dhabi event will kick-off tomorrow (October 22nd) with a group of regional and international leaders from the global Fintech community. The creation of the event is in recognition of the growing importance of Fintech for financial centers and the financial services... Read More
On October 20, at its 6th Convention in Vilnius, Lithuania, the European Crowdfunding Network (ECN), the European association of alternative finance platforms, released its Third Edition of the Review of Existing Regulations of crowdfunding and related alternative financing in the 28 countries of Europe, as... Read More
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On Friday, The Good Egg announced it has extended its second equity crowdfunding campaign on Crowdcube for an additional two weeks.The launch of the initiative came less than three years after the restaurant secured £253,540. As previously reported, The Good Egg was inspired by Californian deli Wise Sons and has... Read More
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Everyone was talking about the Tezos Initial Coin Offering when it raised $232 million this past summer. Now everyone is talking about Tezos for all of the wrong reasons as an internal squabble has called the entire project into question. Tezos (ancient Greek for “smart-contract”), just... Read More
The post Wheels Fall Off: Infighting at Tezos Puts ICO Windfall in Question appeared first on Crowdfund Insider.
Alipay has partnered with Marqeta on real-time payment processing for millions of Chinese travelers visiting North America. Marqeta is an open API payment card issuing platform. Alipay, part of Alibaba, is the world’s leading third-party payment platform with more than 520 million users. Through the partnership,... Read More