In July 2013, Ontario took a big step towards opening the market to equity crowdfunding, as Crowd Valley reported in this article, allowing a company to run an equity crowdfunding portal for social or environmental issuers. Eight months later, in March 2014, the Ontario Securities Commission (OSC), together with other provincial financial authorities (Alberta, Quebec, Saskatchewan and New Brunswick), published a joint proposal for regulations for securities crowdfunding (i.e. the Crowdfunding Exemption).
On March 14th 2014, Japan’s Prime Minister Abe and his Cabinet approved a de-regulation of equity fundraising to the Financial Instruments and Exchange Law paving the way for companies, especially startups, to raise finance through crowdfunding.
At the invitation of the State Department of the United States of America, Crowd Valley presented and advised institutional investors in Washington DC on efficient capital allocation and how crowd investing is changing the landscape with funds and institutions.
Her Majesty (HM) Treasury has announced that as of July 1st, 2014 peer-to-peer lending is being given tax discounts for the first time in UK history. The radical reformation will take place within the Individual Savings Account (ISA) system.
Silicon Valley Crowdfund Ventures hosted the second crowdfunding gathering in Palo Alto, California, April 3 & 4. Crowd Valley was present with chairman Jouko Ahvenainen on two panels at the event.
Since the early days of crowd investing, which for us mean 2008 and 2009, we have seen the need for a connected ecosystem, rather than isolated silos. This is today more true than ever, and the crowd investing market has developed to included many different dimensions to consider.
On March 27th, the European Commission (EC) published a communication on crowdfunding as part of the roadmap to meet long-term financing needs of the European economy, which aims at fostering sustainable growth in the Union.
Although the news was anticipated a few days earlier, due to a leak of information promptly reported by the main newspapers, the actual communication on crowdfunding still brings along some interesting news.
The depth and breadth of the equity and debt capital markets in the United States has been a key driver of the country's economic success. By making capital available to companies of all sizes, from start-ups in Silicon Valley to blue chips on Wall Street, the U.S. system has helped fuel innovation and often given US companies an edge internationally. Through the creation of Rule 506(c) (defined below) and other changes to the rules governing capital raisings in the United States, lawmakers in the United States have sought to open the capital markets even further.
The FCA has announced their regulatory approach to crowdfunding and it will have direct impact on the sector. Investors will be better protected and platforms will have to adhere to rules already commonplace within the wider financial services industry. This deliberate positioning of crowd funding within the financial services industry and not tech or social media is a good move for the sector. The fear that regulation will strangle burgeoning businesses is misplaced as most companies already work to the standards, but new entrants from the tech or social media sectors will have to structure and manage their affairs correctly.
Having a global vantage point and developed operations in this market for several years now, we’ve been paying attention to several developments. One of those, has been the evolution of crowd investing applications to more professional investor audiences and sophisticated systems.