Crowdfunding is now available to unlisted public companies with less than $5 million in turnover and assets thanks to new legislation passed earlier this month.
The change of law allows these companies to utilise crowdfunding to collect up to $5 million per year from small-scale, non-professional investor’s.
What Is the Aim of this New Crowdfunding Legislation?
What Do Start-Ups Have to Say About the Legislation Changes?
1. Kara Frederick – GrowthPoint Australia director
Kara Frederick believes in the long run the new crowdfunding laws will prove a major boon for start-ups, small-businesses and the wider Australasian economy as a whole.
“It can provide a multiplier effect a cross the economy in time. This is a great step in the right direction to increase liquidity to those companies at a time when they need it most,” said Ms Frederick.
2. James Crawford - Beanhunter managing director and co-founder
James Crawford urges small businesses and start-ups to take all the options for raising capital into consideration (such as approaching other successful entrepreneurs) and weigh the pros and cons of crowdfunded equity before proceeding down the crowdfunding route.
Mr Crawford also points out that these businesses should not forget – just as important as having the money to grow is also having the right people in place to aid in this growth.
3. Sarah Hamilton – Bellabox CEO and co-founder
Sarah Hamilton welcomes the new crowdfunding laws because they open up equity funding opportunities previously unavailable to start-ups and small businesses.
She advises businesses considering using crowdfunding to “work with companies such as OurCrowd which assists investors and companies seeking funding, to create the necessary structure to deal with that funding and to ensure clarity of information to potential investors”.