EQUITY CROWDFUNDING
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Universiti Malaya Start-Up Conference & Exhibition
January 21st, 2015
crowdonomic.vc @Crowdonomic Facebook.com/Crowdonomic
Introduction: Crowdonomic Media
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Taking Control of Your FR Destiny
• Mission: Empower Innovators in Asia using the power of Finance 2.0
• Fin-tech, Full portfolio
• Asia-play
Largest CF in SE. Asia
• F13 period • Larger than other SEA CFPs• (SG) ~<10x than int’l CFPs
Innovation is our DNA
• World’s first Telecom-backed CF platform (Crowdtivate)
• World’s first global CF platform for projects positively impacting the earth (WWF/ EarthHour)
Active Regulatory Partner
• Engaging multiple Regulators / Gov’t agencies across Asia
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A class team with >30 years fin/tech experience
Senior Consultant
Asia Strategy Lead
MBA BA. Law
Senior Consultant
Interest rate Trader MBA Engineering
Reona ShimadaCo-founder & CEO
Nicola CastelnuovoCo-founder & CCO
S.E. Asia
Innovation
S. Korea
Finance
China
M&A
South Asia
Tech
Japan
Strategy
UKS.E. Asia India
Tech
W.EuropeNorth Asia
Finance Operations InnovationInvestment
Experience and expertise
Agenda
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Why is this important for you? …because efficient access to Capital is #1 obstacle to growth
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of Micro-SMEs (Start-ups+SMEs) in Asia say access to finance is their largest obstacle to growth
Source: IFC/ Worldbank Enterprise Survey 2006-10; World Bank GDP 2008 - 2010
40% #1
Crowdfunding… This is Finance 2.0 What it is: Crowdsourcing for venture capital
How it Works: Fundraising accelerated by the power of social media and harnessing the wisdom of the crowds
Fill standard offer templates
Publish Online
Advertise via social media
Access virtual investor community
Reach $ targetGrow your business
Smaller amounts of money from many people to reach higher targets
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Publish Offer PageAccess virtual
investor community
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Acceleration Validation Traction
#1: Use the full power of web, social media and technology to accelerate the Fundraising process
#2: It is a Game Changer for both Start-ups and Investors
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Efficient outreach to multiple investors via internet
Startups
Low – mid digit FRsRecord millions
8 -12 weeksAverage online fundraise period
Centralized deal sourcing platform
Investors
Crowdsourced due diligence community
$1 to 5KBite-sized investments to
diversify investment portfolio
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Technology Consumer/Retail Real Estate Fund
• MedTech robotics firm • Raised S$4.2 M
on OurCrowd• IPO’d receiving
S$46.2 M in net proceeds
• F&B Chain in UK• Raised S$4.3M
on CrowdCube• Pool of 749
investors – accredited and retail
• Crowdfunding for a hotel in Palm Springs• Raised S$1.9M
on RealtyMogul• Pool of 85
accredited investors
• Prolific early-stage venture fund• Crowdfunding
$100M fund with SeedInvest
#3: Emerging Crowdfunding Verticals
Agenda
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Equity Crowdfunding: Modernizing Fundraising
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Conventional Fundraising: Extremely
Difficult and Restricted Activity (Expensive, Time
Consuming)
Equity Crowdfunding: Still Really Difficult
Fundraising Activity but Equipped with Modern,
Online Tools (Faster & Standardized
Process, Web/Social Tools for Effective
Outreach)
No reported cases of Fraud
Shareholders can be bundled up into a
vehicle
Investors are also chosen; Use lead investors to
inform market
You can control the level of information disclosure
“I’ll be stuck with managing Thousands of Shareholders (and
forced to IPO)!” “High Risk of Fraud”
“Competitors will steal all of my information”
The Market will be over-flooded with NVA Capital creating a
bubble
We are tackling Common Equity Crowdfunding Concerns
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Agenda
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Equity CF Offer Page – A dedicated fundraising page
Content: Building Up Credibility on Your Offer page
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Board & Team with relevant credentials
Endorsement from fans and industry
experts
Strategic Partnerships
IP (early stage onwards)
Attractive valuation and desirable exit
Demonstrate ability to achieve
milestones
Additional Items:• Business Plan• Investor Pitch
Deck• P&L• Cash Flow• Balance Sheet
• Sell the vision / dream
• Ground the business plan
• Nail the delivery
• Form as important as Content
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Visual: Supporting Your Offer Page with Video
Do • Be vague
• Be boring
• Be awkward
• Show only the product
Don’t
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Video Case Study: Twenty Something London
Watch this video at https://www.youtube.com/watch?v=f2SqVkGmRX4
Team: Assembling a Capable Fundraising Team
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Charismatic Front Person
Graphic Design/ Video Person
Social Media Person
Document and numbers person
• Media spokesperson
• Investor Meetings
• Brand Ambassador
• Social media updates
• Site updates• Answering
enquiries
• Putting together the offer page
• Putting together the financial documents
• Designing visuals
• Creating video and other creative assets
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Recap
• Secret sauce… Social Media (Distribution) + Democratic Participation
• Difficult and Inefficient = > To: New efficient way to do fundraising
• Malaysia – a pioneer market, power to Start-ups
• Combine with Lead Investors + Conventional best practice
• Promote, Market and Execute…make full use of this New Freedom
Sign up at www.crowdonomic.vc
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…and we’re hiring too! E-mail CVs to
[email protected] for Business Development, Developer and
Internships at our KL & SG offices
crowdonomic.vc @Crowdonomic Facebook.com/Crowdonomic
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ECF Regulatory Framework – Highlights*
(*) Note: Contents in this page are based on SC ECF Public Response Paper and they are still pending parliament final approval. Source: http://www.sc.com.my/wp-content/uploads/eng/html/consultation/140925_PublicResponse_2.pdf
DISCLAIMER: This does not constitute any legal or financial advice
Who: All Malaysia incorporated private companies
How much: Private Companies (RM 3 mn / RM 5 mn)
Offer: Primary (new share sale); Secondary (existing shares; 2 wks per 6 months)
Advertisements: May advertise to the public but ONLY via the ECF platform
Investors: Retail (RM 50k) + Angel (500k)+ Sophisticated Investors (Uncapped)