Crowdfunding for investors could prove model is effective

Most conversations we’ve had around crowdfunding revolve around the concept that it allows the average Joe to make an investment in a startup project. But why can’t accredited investors get in on the fun too? Our friend Shane Schick writes about a Bay Street firm, Optimize Capital Markets, about their crowdfunding portal targeted specifically at accredited investors.

Most people spending time on the Web are by now familiar with the crowdfunding model put forward by Kickstarter or Indiegogo – a company or individual asks for consumers to fund their campaign in return for the promise of future rewards or picks. But there’s also a movement to make equity-based crowdfunding possible in Canada being spearheaded by Invest Crowdfund Canada and the National Crowdfunding Association of Canada. The concept is simple enough: instead of a perk such as a promised product delivery or a great T-shirt, an average person could own a small stake in the company. While the U.S. paved the legal path to make this type of crowdfunding possible last year with the passage of the JOBS Act, Canada’s provincial regulators are still discussing whether it’s a good idea or how to go about it.

The fact a firm is pursuing institutional crowdfunding is a reflection of that legal reality in Ontario. While it can’t target the mass market, Optmize Capital Markets is building its model around the people that are legally allowed to make direct investments in startup firms. But if the Ontario Securities Commission decides to change its regulations then a firm like this could be in a good position to open its platform to more users.

Also, if the firm is successful, it will be a proof of concept for crowdfunding. Accredited investors have other avenues to park their money, so if they flock to a crowdfunding portal, it will show the model can truly be a disruptive vehicle for venture fundraising.

[Source: Brian Jackson @ Y! Finance CA @ ITBusiness]

http://www.itbusiness.ca/article/42141

Tags: , , , , ,

HEADLINE NEWS

LivemintFinding the right balance on crowdfundingLivemintSecurities market regulator Sebi (Securities and Exchange Board of India) has been trying to get a handle on digital platform-based crowdfunding since at least 2014, when it issued a cautiously positive consultation paper. It fl [...]

U.S. News & World ReportNo Cash for Hate, Say Mainstream Crowdfunding FirmsU.S. News & World ReportThe block on mainstream crowdfunding is just the latest blow to far-right activists operating online. In the last 24 hours, neo-Nazi website the Daily Stormer had its domain regi [...]

FortuneUncensored Social Network Gab Raises $1 Million in Crowdfunding CampaignFortuneA crowdfunding campaign for Gab, a Twitter-like social network that touts its commitment to freedom of speech, surpassed $1 million yesterday. The company claims it is politically neutral and committ [...]

Baltimore SunHarford still opposes crowdfunding sites for school donationsBaltimore SunRaising money through online crowdfunding sites is an ideal way for teachers to find the funds to purchase classroom materials and should be restored, the head of the Harford County teachers' u [...]

Crain's Cleveland Business'Smaller' gifts can go long way for Clinic's crowdfunding platformCrain's Cleveland BusinessFor an institution accustomed to securing multimillion-dollar donations, Cleveland Clinic's latest fundraising effort has some relatively [...]

The Northern Daily LeaderThe perks and pitfalls of crowdfundingThe Northern Daily LeaderWith a few clicks, would-be entrepreneurs, artists and charities can launch a project and start crowdfunding. All they need to do is nominate a dollar goal to raise within a certain time, and list [...]

League: Warriors legend Monty Betham drops crowdfunding bidNew Zealand HeraldFormer Warriors Monty Betham has pulled the pin on his quest to launch a crowdfunding campaign to buy the Warriors. With Warriors owner Eric Watson locked in negotiations to sell, Betham made a plea to league [...]

ForbesWhat Works In Equity Crowdfunding -- Insights From ResearchForbesAs we have recently celebrated the fourth anniversary of the signing of the JOBS Act into law, it is a good time to take stock of the effect that the legislature had on equity crowdfunding in the United States. It [...]

GeekZing Smart Light Passes Crowdfunding Goal With Flying Colors ...GeekAt age 31, I still prefer to keep a light on in the hallway, illuminating my way to the bathroom in the middle of the night. (God forbid I step on the creeping cat—or ...and more » [...]

Censorship in Crowdfunding Services and How Bitcoin Could HelpInside BitcoinsThis once again highlighted the need for crowdfunding and community support for independent projects to remain afloat, but this time it was more serious. With YouTube throttling advertising revenue to creator [...]

CFB Finance

Marketwired

  • Crowdfunding
  • Crowdfund
  • Peer to Peer Lending
  • FinTech
  • Reg A+
  • Reg CF
  • Crowdfunding USA

Press Release

Live Crowdfunding .tv

What's Next Step in Regulation A+ JOBS ACTS Title IIII :L Interview : Steve Cinelli with Brian Korn Securities and Crowdfunding/Peer-to-Peer Lending Lawyer, Watch more video library | Conference | Interview | Campaign Showcase | Research | Education |