Crowd Sourced Funding Equity Raising only for public companies?
Business Advisory Services Update
This is a MYTH!
Whilst eligible ‘Unlisted Public Companies’ are able to utilise Crowd Sourced Funding Equity Raising to raise capital, very importantly, so can ‘Private Companies’.
When the legislation Corporations Amendment Act was introduced (September 2017) only ‘Unlisted Public Companies’ were able to utilise this process for raising capital from the public.
However, the Government soon realised that the overwhelming number of companies wanting to raise capital, without incurring significant costs undertaking an ‘Initial Public Offer’ (IPO) were ‘Private Companies’. Amendments to the legislation were passed in September 2018, enabling qualifying Private Companies to utilise Crowd Sourced Funding Equity Raising to raise capital.
Private Companies are now the largest users of Crowd Sourced Funding Equity Raising, with over $248M having been raised for companies with annual turnovers less than $25M since 2018.
Assisting companies to prepare themselves for the capital raising process is a service that some Accountancy Firms are already offering. These firms have identified a market opportunity from assisting companies to raise capital by assisting those entities in the preparation of the required documentation.
This week, we will present a series of observations relating to Accountants and Bookkeepers being able to assist Private Companies and Unlisted Public Companies seeking to raise capital, which will be beneficial for the companies, Accountancy/Bookkeeping firms and their team members who will be undertaking interesting and challenging work.
ESS BIZTOOLS has developed ‘Crowd Sourced Funding Equity Raising Product Package’ to assist Accountants/Bookkeepers to offer these services.
