Georgia P. Quinn is the CEO and co-founder of iDisclose, an adaptive web-based application that enables entrepreneurs to prepare customized institutional grade private placement
(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
- GLOSSARY OF TERMS
This was not prescribed anywhere in regulations for documents that weren’t disclosure documents but over a period of time things like quarterly reporting, annual accounts and other things were added to the mix to strengthen the self-regulated compliance framework.
With ICO’s I see the same effort by early adopters in their documents. There is an eagerness to be transparent and provide valuable and essential information for prospective funding providers. However as these are early days there is a widely disparate level of transparency and disclosure by ICO promoters. This is to be expected but just as equity crowdfunding evolved around the world as players engaged with regulators, so will the ICO area.
The main difficulty at ASSOB from 2004 to 2010 was that entities often had no turnover, maybe not a product and no track record. The question was how do you assess these companies as potential investments. This same question is front and centre for ICO’s.
We solved this at ASSOB by using “Fundability Circles” to assess opportunities. Since 2015 a lot has changed, including the emergence of ICO’s so I thought it would be good to update this and do an ICO version.
Here it is!
Here is how you use it!
When you look at an ICO opportunity the three circles equal the main areas to assess a raise. I’ve listed some factors to assist you but basically each of the areas should have a total of 10 points with the total being 30. Obviously if you get 30 out of 30 for an ICO raise you are good to go. What happens though is usually one area is much lower than the other two. Often you can have a great idea with a very technical team but nobody in marketing or legitimisation. Or at other times the marketing team is great but the people are not around to build it.
Most ICO “White Papers” usually include Story, Team and Legitimisation but often they are weighted differently in each white paper. If you are involved in an ICO, or you are promoting one, you should yearn to get balance in the document so the three areas are equally reflected. (Note the intersecting areas between each circle)
- The Team must be capable of implementing the story
- The Team must appear credible to the potential partners and investors
- The Story must be relevant to potential partners and investors
Trust this assists you with your ICO. After seeing 300 odd raises go through this process it is indeed a great way to get an early grip on the possibility of success or as it says in the middle … the “Fundability Potential”.
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 on the bar for Tier 2 offerings qualified in the second quarter of 2017, all of the refreshed data in the sidebar and throughout the charts will only pertain to offerings qualified in the second quarter.) Hover your cursor over a chart for additional information.
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
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 may be liable for violations of the securities laws. Additionally, securities exchanges providing for trading in these securities must register unless they are exempt. The purpose of the registration provisions of the federal securities laws is to ensure that investors are sold investments that include all the proper disclosures and are subject to regulatory scrutiny for investors’ protection.
“The SEC is studying the effects of distributed ledger and other innovative technologies and encourages market participants to engage with us,” said SEC Chairman Jay Clayton. “We seek to foster innovative and beneficial ways to raise capital, while ensuring – first and foremost – that investors and our markets are protected.”
“Investors need the essential facts behind any investment opportunity so they can make fully informed decisions, and today’s Report confirms that sponsors of offerings conducted through the use of distributed ledger or blockchain technology must comply with the securities laws,” said William Hinman, Director of the Division of Corporation Finance.
The SEC’s Report stems from an inquiry that the agency’s Enforcement Division launched into whether The DAO and associated entities and individuals violated federal securities laws with unregistered offers and sales of DAO Tokens in exchange for “Ether,” a virtual currency. The DAO has been described as a “crowdfunding contract” but it would not have met the requirements of the Regulation Crowdfunding exemption because, among other things, it was not a broker-dealer or a funding portal registered with the SEC and the Financial Industry Regulatory Authority.
“The innovative technology behind these virtual transactions does not exempt securities offerings and trading platforms from the regulatory framework designed to protect investors and the integrity of the markets,” said Stephanie Avakian, Co-Director of the SEC’s Enforcement Division.
Steven Peikin, Co-Director of the Enforcement Division added, “As the evolution of technology continues to influence how businesses operate and raise capital, market participants must remain cognizant of the application of the federal securities laws.”
In light of the facts and circumstances, the agency has decided not to bring charges in this instance, or make findings of violations in the Report, but rather to caution the industry and market participants: the federal securities laws apply to those who offer and sell securities in the United States, regardless whether the issuing entity is a traditional company or a decentralized autonomous organization, regardless whether those securities are purchased using U.S. dollars or virtual currencies, and regardless whether they are distributed in certificated form or through distributed ledger technology.
The SEC’s Office of Investor Education and Advocacy today issued an investor bulletin educating investors about ICOs. As discussed in the Report, virtual coins or tokens may be securities and subject to the federal securities laws. The federal securities laws provide disclosure requirements and other important protections of which investors should be aware. In addition, the bulletin reminds investors of red flags of investment fraud, and that new technologies may be used to perpetrate investment schemes that may not comply with the federal securities laws.
The SEC’s investigation in this matter was conducted in the New York office by members of the SEC’s Distributed Ledger Technology Working Group (DLTWG) — Pamela Sawhney, Daphna A. Waxman, and Valerie A. Szczepanik, who heads the DLTWG — with assistance from others in the agency’s Divisions of Corporation Finance, Trading and Markets, and Investment Management. The investigation was supervised by Lara Shalov Mehraban.
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. So it wouldn’t make sense to say “I’m selling nuggets of gold using Crowdfunding.” The nuggets of gold have an intrinsic value without reference to the cash flow of anything else, or at least you hope they do. I can go shopping with a cryptocurrency like Bitcoin or Ethereum, just as I can shop with US dollars or, historically, with gold.
This is where things get tricky and words matter. The blockchain – the technology underlying all cryptocurrencies – can be used for a lot of things other than cryptocurrencies. As it happens, one of the things the blockchain can be used for is to keep track of stock certificates. In fact, the blockchain works so well keeping track of stock certificates that it will undoubtedly be used by (or replace) all public stock transfer agents within the next five years.
What’s happening today is that companies are selling what they call “cryptocurrencies” that are really just interests in the future operations of a business, i.e., really just hi-tech stock certificates. Cool, they’re using blockchain technology to keep track of who owns the company! But that doesn’t mean what you’re buying is really a cryptocurrency and that you’re going to get rich like the early buyers of Ethereum.
Words are powerful, and the confusion around cryptocurrencies is deepened by the nomenclature. Sales of cryptocurrencies are often referred to as “initial coin offerings,” or ICOs, which implies a similarity to “initial public offerings,” or IPOs. Yet if we’re being careful, the two have nothing in common. In an IPO a company sells its own securities, which have value only based on the success of the company. In an ICO somebody sells a product that has intrinsic value of itself.
Ignoring the difference is going to land someone in hot water, probably sooner rather than later. A company that sells something it calls a cryptocurrency but is really just a share of stock is selling a security, even if that company has an address near Palo Alto. And a company that sells a security is subject to all those pesky laws from the 1930s. If you sell a cryptocurrency that is really just a hi-tech stock certificate, then not only do you risk penalties from the SEC and state securities regulators, you’ll also face lawsuits from your investors if things don’t go as planned.
How to know whether you’re selling a true cryptocurrency or a hi-tech stock certificate? Here are some tips:
- If the value of the cryptocurrency depends on the success of the business, it’s a security.
- If the value of the cryptocurrency depends on, or is backed by, real estate or other property, it’s a security.
- If the cryptocurrency is marketed as an investment, it’s probably a security.
- If the value of the cryptocurrency depends what the buyer does with it, rather than the success of the business, it’s probably not a security.
- If the cryptocurrency merely gives the holder the right to participate in a group effort (g., the development of software), it’s probably not a security.
- If you’re selling the cryptocurrency in lieu of issuing stock, it’s probably a security.
By Anum Yoon Crowdfund Beat Guest Editor,
The idea of crowdfunding has gained popularity in the past few years. Individuals contributed approximately $880 million in 2010, when the concept was still new and innovative. Today, the practice of crowdfunding generates tens of billions for startup enterprises, budding entrepreneurs and motivated professionals on an annual basis.
But the concept behind this relatively new phenomenon isn’t limited to financial investments. Some of the more tech-savvy and energy-conscious leaders of today are now exploring the value of crowdfunding to meet our nation’s growing energy needs. The results are showing tremendous potential to revolutionize the way we look at our utility bills from this point forward.
Embracing the Shared Economy
Crowdfunding is paving the way for what many experts refer to as a “sharing economy.” Expected to be worth over $300 billion by 2025, the sharing economy provides new opportunities around the world. When applied to energy production and consumption, this amounts to newly built, sustainable energy sources and the establishment of new facilities in remote regions of the world.
The Africa Regional Climate Change Programme, a part of the United Nations Environment Programme, or UNEP, points out that more than 60% of Africans do not have access to a standardized power grid. Crowdfunding and the sharing economy are poised to help these communities by developing energy sources that are clean, renewable and sustainable.
Mosaic, which recently launched in the U.S., serves as a go-between on behalf of clean energy investors and solar projects that need funding. Investments start at the low price of $25 for annual returns of 4.5%. Like with all investments, those who put in more money will have a greater chance of receiving significant profits in the long run.
Crowdfunding Energy Around the World
According to recent studies, the United States currently leads the world in active energy crowdfunding projects with eight different initiatives. Germany boasts six, the United Kingdom has five and Netherlands has four of their own.
There has been a strong push toward eco-friendly and sustainable energy around the globe. In 2014, nearly 10% of all the energy consumed in the U.S. was drawn from renewable sources. This number has remained consistent and will likely increase even further as more crowdfunding campaigns pop up.
Europe is making huge strides in the effort to curb fossil fuels. Approximately 90% of new energy generators installed in 2016 utilized renewable sources. The majority of this new power is coming from large-scale windfarms in countries like Germany, France, Finland, Ireland and Lithuania.
Some of the most popular energy crowdfunding platforms are based in the United Kingdom. GenCommunity and Abundance Generation, two of the most popular options to date, are both based in the U.K.
Overcoming the Obstacles
As bright as the future of crowdfunded energy seems, there are some roadblocks to overcome. Given the large scale of many projects in the energy sector as well as the high costs and extended timeframes needed to complete such jobs, the industry doesn’t lend itself to the idea of crowdfunding.
In an economy where investors want to see instant results, there simply aren’t many projects in renewable energy that match the format.
Proof of these challenges can be seen in current projects. Although Europe is on the forefront of energy crowdfunding, most of the campaigns to date were focused on small or medium-sized jobs. This is great for hobbyists and those who want to participate in a community-oriented effort, but it does little to address the growing issue of worldwide energy consumption — at least for now.
One of the primary points of crowdfunding energy is to make it possible for smaller investors to raise the capital needed for bigger and better projects. This opens up the industry to a far greater number of investors and even more minds trying to solve such challenges.
Larger Investments Will Lead to Greater Advancements
Although the number of renewable energy projects to benefit from crowdfunding has been limited thus far, proponents of the platform are optimistic about the future. With more investors starting to consider crowdfunding as a viable means of financing projects, and as more investment groups begin to target the renewable energy sector, we’re bound to see even larger investments and greater advancements across the board.
By Anum Yoon, Crowdfund Beat Media Guest Editor,
Throughout the past few years, crowdfunding has become a source of fundraising for charities, life-saving surgeries, new products, individual travel goals, research projects and more. With crowdfunding platforms and social media, it’s easier than ever to set up a page where friends and family can donate to whatever it is you’re passionate about or need money for. But does this new fundraising fad have a place in politics?
Politicians who are starting campaigns or building platforms need money, and it’s a fairly new possibility that this money could come from small individual donations from people on crowdfunding websites instead of the wealthy upper class. Here’s everything there is to know about crowdfunding in the political arena.
Traditional Political Fundraising
In the past and even currently, campaigns have been funded by the appropriate political party the candidate is running for. Additionally, wealthy donors throw large amounts of money into the politician’s bank account and, more often than not, cash in the donation for a favor later on down the road.
With this system, the upper class and politicians are completely running the show. Campaigns are based on who got money from the top dogs, and elections are based on those campaigns. So, it’s not hard to see how the average person isn’t exactly included in the political process.
Changes Being Made
In 2008, Barack Obama, who would be elected president that year, changed the game of fundraising in politics. He was the first candidate who collected funds for his campaign from the average working class family.
Obama successfully built a campaign that got American families interested and invested in him – literally. He asked for donations on his website in order to fund his campaign and raised millions of dollars from small donors who simply donated what they could afford, even if that was only a dollar.
Obama’s strategy worked, obviously. Since then, politicians at the local and federal level have used similar campaign strategies. Bernie Sanders, who ran for the Democratic nomination in the 2016 presidential race, prided himself on not accepting money from billionaires. Instead, he wanted to be funded only by the average American. It was easy for his supporters to support him because donating was just a few clicks away thanks to the ease of electronic payments.
He would often send out emails to his supporters asking for just $3 before midnight to send a message to Washington that Americans are tired of billionaires buying elections. The average campaign donation was $27.
On the surface, it seems like Sanders’ strategy did not pay off, since he did not win the nomination. However, Bernie Sanders made quite a name for himself in just a few short months and was a serious contender for the nomination, running on only small donations through crowdfunding efforts. His effort is a look into what could be the future of political fundraising.
Building a Community
The idea behind crowdfunding is to build a community. Crowdfunding started with individual stories. People who wanted to travel and do philanthropic work. Somebody who needed a surgery their family couldn’t afford. An entrepreneur with a great business idea. A young girl who wanted to go to Disney World.
The stories behind each crowdfunding page are what drives people to donate money. People tell their story in the hopes of touching others and convincing them to donate to their cause.
For this reason, crowdfunding in the political arena could be a great thing. Imagine politicians building their campaign not around the nitty gritty of politics, but around a story that touches the American people — a story of hope and resilience. Campaigns and politics in general could become so much more personalized, and Americans could really play a part in the government.
Of course, there are always some things that could go wrong. Politicians could somehow corrupt this system. There will always be billionaires to buy out politicians in their own best interest. There are holes in every system, but it’s also possible to patch up those holes. Since crowdfunding is such a new idea, there is much to be said and discovered about how the system would actually work when utilized by many politicians.
So, crowdfunding in politics could be great, it could be terrible or it could be somewhere in the middle. Only time will tell how politicians will use crowdfunding for their campaigns and how people will react to this new way of fundraising.
BY Rachael Everly ,CrowdFund Beat Guest Post,
Crowdfunding platforms are a product of technological advancement. However at the end of the day they are a financial solution and their success is dependent on the economic situation at a given time. Many businesses prosper when the economy is booming and all is good. Crowdfunding on the other hand has always prospered when the economy is not doing well, and even during the worst recessions.
During the last recession of 2008, there was a great lack of confidence among banks. This led to a drying up of sources of finance for the small business owner and for individuals who were just starting out. Either their loan applications were outright rejected or they were given such high interest rate offers that they were forced to decline. But with the advent of digitalization came the much flexible option of crowdfunding that led smaller business achieving the necessary finances much cheaply and much easily.
Setting up a crowdfunding platform is an excellent business idea for it is something that the entrepreneurs need. However to be successful it has to meet the finance needs of people successfully.
- Initial set-up
Crowdfunding platforms are a place where investors and people looking for finance gather. So you need to be sure about how you are going to attract investors in your starting days. Your whole business is dependent on them.
You also have to ensure that you offer a “deal” that is both acceptable to investors and the people looking to borrow. The system has to be set up in a transparent way in order to induce trust from all the involved parties. In order to achieve this you will have to focus on a marketing strategy that delivers the maximum information. Information about how you operate, the charges for the borrowers and how are you going to handle the funds at your disposal. You will especially have to convince people that your platform is a secure place to invest. You will need to figure out your marketing channels. The most basic will be your own company blog and possibly even your own in-house developed app (which could be done via crowdfunding).
- Developing a brand
Once the crowdfunding concept was new and there were hardly any platforms on the scene. Now competition is arriving and the first mover advantage is long gone. You will have to differentiate yourself from your competition. In the simplest way, it could be by the way of focusing on the aesthetics on your website that is the logo and theme and the usability.
Secondly you should match the features being offered by the competition and where possible streamline your processes even more. You will have to communicate your “differences” via email marketing and company blog. The best way to do this is to provide content that is actually useful for the reader and yet brings your platform to attention.
- The technical expertise
At the end of the day customers prefer businesses that provide them with a superb quality service or product. Crowdfunding is essentially a fintech product and thus technology is its backbone. Your crowdfunding platform must not only be user friendly, but it also must be secure and have features that help you make better decisions. For example, Zopa has its own algorithm for deciding which borrowers are more likely to stick to repayment schedules.
In order to succeed it is very important that you analyze your existing competition and see what features you have to match in order to attract customers and what you can do better than them.
By Anum Yoon, Crowdfund Beat Media Guest post,
Venture capitalists tend to back entrepreneurial firms that reflect their own ideas and match their social and educational experiences. This type of financing has resulted in a concentrated amount of funds for business endeavors in specific locales. Venture capitalists are typically wealthy investors, investment banks and other financial institutions with similar interests.
Silicon Valley and Boston benefit greatly from venture capitalism, while struggling entrepreneurial startups across the country are suffering from a venture capital drought.
However, the industry is changing with the expansion of crowdfunding platforms, such as Kickstarter, helping to level the playing field. A recent study from the University of California at Berkeley states that crowdfunding financing is now accessible outside of the traditional startup and technological landscape, with even the restaurant industry jumping into the crowdfunding action.
Crowdfunding Platform Expansion Leads to Nationwide Innovation
Crowdfunding appeals to entrepreneurs and investors looking for a different tribe. Since many venture capitalists (VCs) finance people and ideas similar to their own, women and minority entrepreneurs can benefit greatly from crowdfunding expansion outside of the normal VC region.
The study from UC Berkeley identified specific regions where the majority of financing from VCs are concentrated. The study analyzed data from 55,0005 Kickstarter campaigns and 17,493 venture capital investments that were similar in activities.
The researchers mapped the successful campaigns and financing from 2009 to 2015. What the researchers found was that the Kickstarter campaigns originated from all across the country and from areas not typically financed through venture capitalism. This includes the cities of Chicago, Los Angeles and Seattle.
Venture capitalism was responsible for the financing of entrepreneurial firms in highly concentrated areas. As much as 50 percent of all VC financing concentrates in only four counties within Silicon Valley and Boston.
The study took into account the relative intensity of the crowdfunding platform and venture capital funding in each region. Using this formula, the researchers could account for the differences in population and other factors that might skew the results.
The researchers found that areas with Kickstarter investments were located away from venture capitalist funding. For example, in the Bay area, VC funding is primarily focused in San Francisco and the Peninsula, but Kickstarter funding concentrates in Marin and Napa counties.
According to the researchers, the results could show an inequality in entrepreneurial funding in regions. In areas with Kickstarter technology campaigns, the study found that venture capitalist funding increased as VCs find these new ideas attractive.
Other Crowdfunding Platforms Expanding
The six-year study from UC Berkeley focused on Kickstarter as the crowdfunding platform, but others are expanding their reach across the country in hopes of reviving the entrepreneurial legacy while stimulating the economy and supporting charities.
GoFundMe recently acquired CrowdRise to expand fundraising initiatives for charities. GoFundMe processed the transactions for CrowdRise during 2016, and the platform raised $100 million each month and grew 300 percent year-over-year. The acquisition increases the opportunities for social fundraising and charity fundraising.
Other crowdfunding platforms that small businesses and entrepreneurs are using include Indiegogo, Fundable and RocketHub. Indiegogo launched in 2008 and announced in 2016 that it has added equity crowdfunding to open the door for small investors.
Fundable is an Ohio-based crowdfunding platform that attracts accredited investors for entrepreneurial businesses, such as InstaHealthy USA.
RocketHub offers traditional donation fundraising as well as equity-based crowdfunding through the ELEQUITY Funding platform and Bankroll Ventures.
Now entrepreneurial startups in smaller cities and rural areas have a chance to develop and share their ideas with crowdfunding platforms. Not long ago it was determined that U.S. entrepreneurship was at a 40-year low, but this may soon change.
The American entrepreneurial spirit still exists, it just needs a little financial help from its tribe.
2017 who’s who in CrowdFunding World
As you know CrowdfundBeat.com continues to grow as the preeminent go-to source for all news and trends Crowdfunding related. Our conferences are expanding as part of our “World Tour” for 2017.
For sponsorship opportunity contact: CFB@CrowdFundBeat.com or call 1 888 580 6610
|Jay||Abraham||Business Growth Strategist|
|Dara||Albright||Dara Albright Media & FinTechREVOLUTION.tv||@tothestoics|
|Kendall||Almerico||Crowdfunding and JOBS Act Expert||@FundhubBiz|
|Antonio||Arias||CEO and Co-Founder Healthy Crowdfunder Corp||-@alamidas – @healthvcfunder|
|Sydney||Armani||CEO Crowdfunding USA & Publisher of CrowdFund Beat Media Groupemail@example.com|
|Joseph||Barisonzi||Leader Community Turnkey Crowdfunding|
|James||Beshara||CEO And Co-Founder Crowdtilt|
|Jason||Best||Co-Founder And Principal Crowdfund Capital Advisors||@CrowdCapA|
|Bruce||Blankenhorn||COO Realty XE .com Real Estate CrowdFunding|
|Amanda||Boyle||CEO And Founder Bloom VC||– @nowaffle|
|Ryan||Caldbeck||CEO Circleup, A Crowdfunding Platform For Accredited Investors|
|Chris||Camillo||Author Laughing At Wall Street: How I Beat The Prosinvesting||@ChrisCamillo|
|Aubrey||Chernick||Founder, NextGen Crowdfunding||@|
|Steve||Cinelli||Financier, economist, author, artist.||@|
|Dan||Ciporin||CEO And Venture Capitalist|
|Susan||Cooney||Founder & CEO At Givelocity|
|Trish||Costello||CEO & Founder Portfolia|
|Christopher.j||Crippen||Certified Crowd Funding Professional,|
|Brian||Dally||Co-Founder & CEO, GROUNDFLOOR|
|Mat||Dellorso||CEO Of Wealthforge|
|Kathryn||Diamond||SVP Boston Private Bank, Wealth Management|
|Andrew||Dix||Co-Founder Crowdfund Insider|
|Tommaso||D’Onofrio||CEO Assiteca Crowd S.R.L.|
|David||Drake||LDJ Capital Soho Loft Capital Creation|
|Timothy C.||Draper||Draper Founder Partner Of DFJ|
|Peter||Einstein||Crowdfunding4all (CF4ALL) – Search Engine|
EGS Leading CrowdFunidng Firm
|Alex||Fair||Co-Founder And CEO Medstartr.Com||@alexbfair|
|Ryan||Feit||CEO And Co-Founder Seedinvest||@ryanfeit|
|Brad||Feld||Managing Director Foundry Group|
|Jonathan||Frutkin||Co-Founder Cricca Funding , Author Equity Crowdfunding|
the JOBS Act Expert Guzik & Associates,
|Oliver||Gajda||Co-Founder And Chairman Eurcrowdfunding||@olivergajda|
|Dr. Michael||Gebert||German Crowdfunding Network|
|Sandi||Gilbert||Founder & CEO Crowdcapital &Seedups Canada|
|Alfredo||Guilbert||COO Of Digital Film Cloud Network|
|Sara||Hanks||CEO And Founder Crowd Check||@SaraCrowdCheck|
|Kevin||Harrington||Chairman Of As Seen On TV|
|Daphne||Habets||Crowdfunding Pro @ geldvoorelkaar.nl|
|Jillian||Helman||Realty Mogul Jilliene@Realtymogul.Com|
|Adam||Hooper||Founder/CEO Of Realcrowd|
|Jessica||Jackley||Investor And Advisor, Collaborative Fund Co-Founder, Kiva||@jessicajackley|
|Barry E.||James|| Author of New Router to Funding, Founder/CEO TheCrowdDataCenter/
|Oscar A||Jofre||Founder/CEO KoreConX Corp.||@oscarjofre|
|Paul||Keating||Founder And CEO Of Crowdcando; A Crowdfunding Platform For Events.|
|Karen||Kerrigan||President Small Business & Entrepreneurship Council||@karenkerrigan|
|David||Khorram||Crowdfunding Evangelist Dkhorram@Crowdfundingplanning.Com|
|Candace||Klein||Founding Member Of Crowdfund Intermediary Regulatory Advocates (CIFRA)|
|Ronald||Kleverlaan||Senior Crowdfunding Strategist & Vice Chairman European Crowdfunding Network|
|Brian||Korn||Crowdfunding Attorney @BKorn@manatt.com|
|Mark||Lancaster||CEO CrowdKey, Inc. White Label CrowdFunding solution firstname.lastname@example.org @mtlancaster|
|Sang H.||Lee||Lee CEO & Founder At Return On Change|
|Howard||Leonhardt||Founder, Chairman And CEO Leonhardt Ventures||@howardleonhardt|
|Alessandro M.||Lerro||Lerro Crowdfunding Italy|
|Jeff||Lynn||CEO And Co-Founder Seedrs||@jeffseedrs|
|Peter||Mackness||UK Crowdfunding, Sponsorship, Brand Activation,|
|Jonathan||May||CEO and Founder,Hubbub, Director of UKCA|
|Gene||Massey||CEO Of Mediashares Gene@Mediashares.Com|
|Blaine||McLaughlin||COO- VIA FOLIO email@example.com|
|Matthew||Mcgrath||President And CEO Of Optimize Capital Markets|
|Congressman Patrick||Mchenry||One Of The Investment Crowdfunding Industry’s Most Resolute Champions|
|Scott E.||McIntyre||Secy. Board Of Directors CFPA , Director Phabriq Devp.;||@scot_mcintyre|
|Jonathan||Medved||CEO At Ourcrowd|
|Brian||Meece||Rockethub Rewards Platform|
|Klaus-Martin||Meyer||Crowdfunding Blogger In Europe|
|Eric||Migicovsky||Founder Pebble Technology||@ericmigi|
|Benjamin||Miller||Co-Founder, Fundrise Fundrise – Direct Public Offering Platform|
|Alexander||Mittal||Co-Founder And CEO Fundersclub@Mittal|
|Vincent||Molinari||Founder-CEO Gate Global Impact,Inc|
|Roy||Morejon||President Of Digital Marketing Agency Command Partners|
|Bill||Morrow||Co-Founder & Director Angels Den|
|Andrew||Moss||President Of Booster, LLC|
|Brock||Murray||CEO Of Joi Media, Makers Of The Katipult White Label|
|Paul||Niederer||Venture Capital & Private Australian firstname.lastname@example.org||@paulniederer|
|Rodrigo||Niño||Prodigy Network’s Founder And CEO|
|Perry||Niro||Montreal, Canada Perry@Groupeavea.Com|
|Jeremiah||Owyang||Web Strategy Www.Crowdcompanies.Com|
|Humphrey||Polanen||Managing Director Of I-Bankers Direct|
|Darren||Powderly||Co-Founder Crowdstreet, Inc.|
|Tanya||Prive||Founder And COO Rockthepost||@tanyapri|
|Scott||Purcell||CEO Fund America email@example.com|
|Georgia||Quinn|| CEO @ disclose.com gquinn
|Mark||Roderickfirstname.lastname@example.org WWW.CrowdfundAttny.com @CrowdfundAttny|
|Naval||Ravikant||Founder And CEO Angellist|
|Danae||Ringelman||Co-Founder And Chief Customer Officer Indiegogo||@GoGoDanae|
|David S.||Rose||Founder And CEO Of Crowdfunding Site Gust|
|Eric||Schreyer||Journalist And Editor Crowdfundbeat Germany|
|Wil||Schroter||Founder And CEO Fundable||@wilschroter|
|Marlon||Schulman||Founder & CEO Horror Equity Fund, Inc|
|Joanna||Schwartz||CEO Of Earlyshares|
|Barry||Sheerman||Member Of Parliament For Huddersfield UK Parliament||@BarrySheerman|
|Barry||Silbert||Founder And CEO Secondmarket||@barrysilbert|
|Rose||Spinelli||Coach, Trainer, Pitch Video Creator Thecrowdfundamentals.Com||@TCFrose|
|Paul||Spinrad||Crowdfunding Advocate Investian|
|Duncan||Stewart||Director Of TMT Research Deloitte Canada||@dunstewart|
|Yancey||Strickler||Co-Founder And CEO Kickstarter||@ystrickler|
|Ron||Suber||President At Prosper Marketplace|
|Bryan||Smith||Co-Founder- Realty Wealth.com|
|Richard||Swart||Chief Strategy Officer NextGen Crowdfunding||@richardswart|
|Kevin||Swill||COO Of The Carlton Group|
|William||Skelley||CEO and founder of iFunding. @|
|Devin D.||Thorpe||Journalist, Author, Philanthropist||@devindthorpe|
|Nadav||Trenter||Moser: Http://Www.Mimoona.Com/ Medugam@Gmail.Com|
|John||Trigonis||Indiegogo Author Of Crowdfunding For Filmmakers|
|Chris||Tyrrell||CEO At Offer Board||@christyrrell|
|Andres||Trujillo||Founder-CEO Global GroupFund inc.|
|Katharine||Voyles||Mobley Chief Marketing Officer Wecarecard|
|Kim||Wales||founder and CEO of Wales Capital||@kimwales1|
|Mathew||Walker||Technology Enthusiast | Domain Name Broker | Ebook Author|
|David||Weild||Chairman & CEO At Issuworks|
|Noreen||Weiss||Adler, A New York–Based Attorney Who Has Written Extensively On Crowdfunding.|
|Joanne||Wilson||Co-Founder Gotham Gal Ventures||@thegothamgal|
|Sherwood||Woodie||Neiss Partner, Crowdfund Capital Advisors|
|Dr. Letitia||Wright||Wright Place TV Show|
|Diana||Yazidjian||Crowdfunding Strategist Canada|
|Korstiaan||Zandvliet||Symbid – Global Equity Platform|
Professional Problem Solver; Partner at Freeborn & Peters LLP
|Bryan||Zhang||Phd Researcher Bryan Zhang||@BryanZhangZ|
Sponsored by 2017 SV CrowdFunding Conference
crowdfundbeat, Crowdfunding, equity crowdfunding, indiegogo, Kickstarter, Real Estate, Realty Mogul, SEC, sv crowdfund, UK, Who’s Who, Who’s Who? of CrowdFunding
By Dara Albright,CrowdFunding BeatGuest Editor, FinTechREVOLUTION.tv , Dara Albright Media,
The year began with the renaissance of the retail investor and it ended with a massive crowdfinance conference which centered – for the first time – around the actual crowd (“retail”) investor.2016 will be etched in time as one of the most unpredictable and metamorphic years in our planet’s history. While every fragment of civilization will feel the effects of 2016, the year will leave an indelible imprint on financial services, global political landscapes and mass media for generations to come.
In between was the successful completion of the Elio Motors Reg A+ offering, the first phase of investment product ingenuity through JOBS Act exemptions, the launch of the first retail retirement technology, the “fix Crowdfunding bill”, the introduction of Congressman McHenry’s new FinTech legislation aimed at fostering financial innovation, the implementation of Reg CF, lots of industry turmoil, a surprising Brexit vote, and perhaps the most controversial and suspense-filled U.S. election in history.
2016 was also the year that the Cubs finally won another World Series and I discovered the video selfie.
Before I underscore how all of these events will have monumental economic implications on 2017 and beyond, let me just take a moment to boast about the accuracy of last year’s predictions.
Last December I forecasted that:
- Robo-advisors will find opportunities in crowdfinance – Just as I predicted, ETF-centric robo-advisors made an entrance into crowdfinance this year. In early 2016, robo adviser, Hedgeable, first entered the crowdfinance space by offering its retail clientele opportunities to venture invest through leading equity crowdfunding platforms such as AngelList and CircleUp. A few months later, Hedgeable announced that it will soon be rolling out a peer-to-peer lending product. Furthermore, based on conversations that I’ve had in recent months with robo-advisory firms as well as with companies that develop technology for robo-advisors, I anticipate many more robo-advisors will soon be joining the party.
- Retail Financial Product Ingenuity will Escalate – As discussed last year, GROUNDFLOOR made history in late 2015 with its Reg A+ qualification to offer micro-investors small pieces of real estate debt. In 2016, two more companies broke ground in the Reg A+ arena: StreetShares and American Homeowners Preservation – offering retail investors the ability to capture both monetary and social returns through micro-investments into private businesses as well as individual mortgages, respectively. Companies like these are helping to inspire a new generation of retail alternative products. This type of investment product ingenuity is about to spread well beyond online platforms and marketplaces. I predict that any financial services business involved in the production or sale of alternative securities will soon look to expand distribution by taking advantage of this modern regulatory framework.
- Straight Equity Title III Offerings will Fall Flat – Indeed they have. According to NextGen Crowdfunding, a leading provider of crowdfunding deal data, investors have committed to invest slightly more than $15 million into Title III equity crowdfunding campaigns during 2016. $15 million equates to approximately 60 Hillary Clinton speeches or the amount that the U.S. national debt grew since you started reading this article. $15 million won’t even begin to scratch the surface of fixing our economic woes. To put it bluntly, $15 million is not an industry – it’s barely even a house in the Hamptons! Unless and until more creative hybrid financing structures are employed for Reg CF offerings, the market for Title III Offerings will remain insignificant.
- Reg A+ “Testing The Waters” will Call Attention to Serious Title II Crowdfunding Flaws – While no one really cared much about this issue in 2016, I do believe that the considerable disparity between total “indications of interest” and the amount of funding actually raised will eventually lead to regulatory amendments. It is completely misleading for a company to “advertise” that it has garnered sizeable funding interest without ever having to notify the public that it failed to raise even a fraction of the amount.
- The Crowdfinance Playing Field will Undergo Leadership Change – Wow, was I right about this one! Industry leadership has begun to undergo significant change in 2016 – particularly in marketplace lending. I stand by my statement that, “New leaders will rise. Some unexpected frontrunners will fall. The businesses that will best be able to oblige the retail customer, adapt to regulatory changes, and penetrate retail’s $14+ trillion retirement capital will prevail.”
- Hoverboards will Disappear from Toy Store Shelves – Uh, I meant to say Galaxy Note 7’s will disappear from the shelves. Yeah, yeah, that’s the ticket. (In the era of “fake news” this totally passé catchphrase deserves to make a comeback).
While some of my last year’s prognostications have yet to fully reach fruition, I’m still standing by all of my 2016 predictions. I’ve come to realize that predictions, much like karma, operate on their own timetable. Even some of the prophecies of the great Nostradamus were a year or two off. And, let’s not forget that Robert Zemeckis was just one year too early in forecasting the Cubs World Series victory.
Speaking of which, you are probably wondering what the Cubbies winning the World Series and video-selfies have to do with the future of personal finance anyway.
A lot. Maybe even everything.
The Cubs World Series win and video selfies are empowering underdogs everywhere. If the most mocked team in the history of professional baseball can win a World Series and amateur videographers can become universally recognized broadcast journalists, then long shots everywhere can achieve astonishing victories. Non-politicians can win presidential elections. Non-lawyers can prevail in litigation. Small businesses can access capital as freely as large corporations. And primarily due to crucial advancements in micro-investing technology, even investing novices will be able to outperform financial experts. At long last, the little guy can have just as much of an opportunity to create wealth as the George Soros and Warren Buffet ilk.
This brings me to my bold 2017 predictions (or as Ron Suber would likely call them “Big Hairy Audacious” predictions).
- Underdogs across the land will triumph in 2017 – The Chinese predict that 2017 will be the year of the rooster. I disagree. I believe that 2017 will be the year of the Rudy.
- The broader markets will correct – I foresee the broader markets headed for a crash – triggered primarily by manipulators, speculators and years of unsustainable monetary policy. Our public equity markets have been artificially propped up by policy for far too long. America simply can’t keep lowering rates and printing its way to prosperity. Interest rates have nowhere left to go but up, particularly if Trump makes good on his economic plan and we see some real economic growth. I foresee rate hikes leading to a stock market correction. Although it may be a short-lived correction, those who are well-diversified and have allocated some capital to less volatile, less correlated asset classes, will be better able to weather the storm.
- The face of financial media will Become Unrecognizable – In 2016 the established media awoke to the revelation that it no longer holds the relevancy that it did in previous generations – something housewives on Facebook have known since about 2008. Although it tried hard not to accept it, traditional media has been hemorrhaging influence for quite some time now. Just like how the video killed the radio star, how Napster crushed the CD, how Netflix annihilated Blockbuster and how Amazon overtook Barnes & Noble, communications technology is on an unstoppable path to demolish mainstream media. While bloggers have been gaining prominence for years at the expense of print media, it will be the video-selfie that delivers mainstream media its final blow. Financial media is no exception. The 2016 U.S. presidential election established social media – not television – as the dominant medium. Clearly, more people tuned into Infowars than to Rachel Maddow. If the video selfie can help influence a U.S. election, its impact on financial services will be colossal. Expect financial content to become edgier as well as more engaging, encompassing and interactive. Expect new financial voices to emerge and gain prominence. Most significantly, expect these new financial media players to forever transform the way people invest, where people invest and how people invest.
- FinTech will Expand into Older Demographics – I see countless FinTech business plans. Most of them are loaded with statistics on millennials, ideas for targeting millennials and even pictures of millennials. Yes, many of us industry folks are well-aware that millennials prefer having a root-canal than going to a bank. However, FinTech is not a millennial-centric market. I predict that 2017 will be the year that FinTech crosses demographical thresholds. I expect that older demographics will start incorporating FinTech into their daily routines. As a result, I envision more FinTech innovation being directed towards developing products for other generations, particularly retirees.
- The U.S. retirement infrastructure will begin to undergo monumental transformation in 2017 – The $14 trillion retail retirement industry is on the cusp of great transformation. Thanks to the progression of FinTech, RegTech and AltTech, the retirement industry is about to become fairer, simpler and more inclusive. Expect regulatory and technological innovations to be introduced that will unwind a broken and unjust retirement system. Expect retirement plans to become more consumption driven than employment-based. You can also look forward to seeing the mass adoption of game-changing financial products that will give everyone – including present retirees – a fighting chance to prosper throughout their senior years.
The story of financial services is unfolding and it is growing more fascinating by the minute. And I am truly grateful to be alive at this particular moment in time to witness it firsthand.
Anyone who has read my previous year-end articles knows how reflective I tend to get as I approach my Christmas Eve birthday. And this year I am especially pensive given the fact that I am turning 29 (again) and that mercury is in retrograde and that Uranus (pronounced: “Your Ron Issss”) is, well it is somewhere in the universe doing something to affect my mood. Whenever that happens, I tend to seek inspiration in a poem, a lyric or even in just one simple word.
It is for this very reason that I subscribe to dictionary.com’s word of the day. On December 16th, dictionary.com’s word of the day was “hotsy-totsy” and it means, “about as right as can be”. Because I vowed to find a way to incorporate this quirky “makes-you-feel-like-skipping” word into an article, I would like to simply conclude by wishing everyone a joyous holiday season and a very hotsy-totsy 2017!
Originally published on Dara Albright Media.
Recognized authority, thought provoker and frequent speaker on topics relating to market structure, private secondary transactions and crowdfinance. Welcome to my new personal blog where you can glean unique insight into the rapid transformation of global capital markets.
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On December 16, 2016, President Barack Obama Signed into Law HR 3784 – SEC Office of Small Business Advocate, creating an independent Office of Small Business Advocate at the SEC, reporting directly to the full Commission and Congress. This legislation was first introduced into Congress in October 2015, where it was originally co-sponsored by former House Representative John Carney (D-Del) (now Governor-Elect of the State of Delaware) and Congressman Sean Duffy (R-Wisc) and was passed unanimously by the House of Representatives in 2016. It was passed unanimously by the U.S. Senate on December 9, 2016, as part of a flurry of year-end bills passed by the Senate before it recessed for the year.
The bill had broad industry support upon its introduction in October 2015, including the U.S. Chamber of Commerce, the National Venture Capital Association, National Small Business Association, Small Business Investor Alliance, SBEC, and the Crowdfunding Professional Association (CfPA), of which I served as its Chair and President at the time.
Remarkably, this Bill passed Congress unanimously without the support of the SEC. In testimony from SEC Chair Mary Jo White before the Senate Banking Committee in June 2016 she was asked by the Senate bill co-sponsor, Heidi Heitkamp (D-ND), whether she supported this legislation. Her response:
“We currently have the Office of Small Business Policy within the Division of Corporate Finance. I am an advocate for small business.”
A roundabout way of saying “no” – it seems to me.
In the past I have referred to this bill as the missing title of the JOBS Act of 2012. Though it parallels to a large extent to the SEC Office of Investor Advocate – part of the Dodd Frank Act of 2010 – the need for this legislation goes back decades.
The successful passage of this law was the result of the participation and support of many individual and groups. However, I am proud to have had a major role in initiating this legislation, among other things:
- I was the first person to publicly advocate for this legislation, in Feb 2014, in an article published on Crowdfund Insider.
- I met with former SEC Commissioner Daniel M. Gallagher in June 2014 to advocate for this bill.
- I was cited by Commissioner Gallagher in a public address (Note 36) by Commissioner Gallagher given at the Heritage Foundation in September 2014 where he advocated for the need for a permanent Office of Small Business Advocate.
- I worked with the original sponsor, Rep. John Carney (D-Del) (now Governor-elect of Delaware) in drafting this legislation prior to its introduction in Congress.
- I assisted in procuring the initial Republican co-sponsor – Rep. Sean Duffy (R-Wis).
A special thank you is in order for SEC Commissioner Gallagher. Without his public and vocal support for this legislation it might have taken many more years for this historic legislation to become a reality.
A copy of the Bill can be found here.
For those of you who want to dig deeper on this subject, here is some background material on the Bill and my role in its journey: