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New Capital Raising Rules for Canadians

It has been a few weeks now since our securities regulators announced a myriad of capital raising regulations for private companies in Canada. For my friends south of the border, we don’t have one regulator that issues national regulations (the SEC); we have 13 different regulators that implement regulations they feel best suit the business and investor environment in their province. When possible, they harmonize these regulations with other jurisdictions, but in many cases, small jurisdictional differences become exceptions in their regulations. It is a bit cumbersome, but technologies like SeedUps and OfferingPoint help manage what investors can access and how much they can invest in particular capital offerings.

Overall, the recent announcements will help lower the cost of raising capitaland broaden the pool of investors companies can attract to invest in their business. That has been our goal from the outset, and although not perfect, these are significant steps to satisfying the funding gap companies face when seeking between $250K and $2 million in growth capital.

Download “Your Guide to Raising Capital Online“.

Until now, the only way private companies could raise capital from non-accredited investors was through the Offering Memorandum exemption requiring them to prepare a complex disclosure document complete with audited financial statements (note – Ontario has just published its intent to allow its constituents to participate in these capital offerings effective January 2016) . This exemption has worked well for companies raising north of $2 million in capital, as it is good corporate governance for companies of that size to audit their financials in any event (and they can actually afford it). It simply didn’t make practical sense for companies that were looking for the gap financing I refer to above. So now, companies can prepare a relatively simple disclosure document, present their offering on a public facing portal and attract investment from a wide array of investors – institutions, angels and individuals.

Many of our peers are concerned that companies raising capital through these new exemptions will be saddled with too many shareholders and a dysfunctional cap table that will be disruptive to future investment. I too, agree that too many shareholders may be challenging to manage. The new regulations have investor limits that range from $1,500 to $5,000 for non-accredited investors. In simple math, if a company raised $1.5 million from only those investors, they could be faced with managing over 600 investors. The reality is,no one would recommend that a company raise that much money $2,500 at a time. Capital raises, whether conducted offline or online most always involve different types or classes of investor.

The first investors are key to a successful capital raise.  Everyone wants to see someone else lead the way and typically, those lead investors are close to the company and its management or are advocates or customers of the company and have watched the development of the business to this stage. Companies that want to raise $1.5 million through equity crowdfunding should secure this lead investor prior to launching their raise. The funding portal helps the company share that story with Business Angels and other sources of large capital, filling the middle portion of the raise. The Crowd is there to fill out the rest.

When done properly, a $1.5 million capital raise might have 75 investorsfrom different classes. A lead investor for $500,000, sophisticated investors averaging $75,000 each and the Crowd averaging $7,500 each. That may still sound like a lot of shareholders, but structured properly and managed with technology solutions, those 75 investors can be the company’s sales and marketing arm. When out to dinner with friends, they’ll be talking about their latest investment and encouraging the success of the company.

Hey – have you heard about the XYZ app? It’s awesome – you should download it now! Did I tell you I was a shareholder?

Anyone remember a little company called WestJet? They built their company with the “average investor” advocate. In their day, they did it in the public markets, but today, companies can start with private investors, then go public when they are ready.

Here’s why these regulations are important and what they will mean to the Canadian economy. The potential investment dollars in the hands of the Crowd is enormous. If just a very small percentage of the “not-yet-accredited” investor put a suitable proportion of their investment portfolio into early stage companies, Canadian businesses could access over $1 billion in untapped capital. Imagine what companies could do with that capital. They will grow their businesses, add jobs and contribute to the innovation and diversification of the Canadian economy. Seriously – shouldn’t we give them a chance?

New Offering Memorandum Regulations Announced

The Canadian Securities Administrators have released the final regulations for the new Offering Memorandum (“OM”) Exemption, quasi-harmonized in six jurisdictions in Canada. Ontario will join the rest of Canada and open up private capital investment to “non-accredited” investors in January of 2016, while Alberta, Saskatchewan, Quebec, New Brunswick and Nova Scotia will enforce the new rules effective May 2016.

The new regulations are designed to provide further investor protection when purchasing securities in private issuers. The key changes fall into three categories:

  • Ongoing disclosure – non-reporting issuers will be required to, among other measures, provide investors with audited annual financial statements and an annual notice describing how the proceeds raised under the OM were used.
  • Disclosure at time of offering – any marketing materials will be required to be incorporated by reference in the offering memorandum so that they are subject to the same liability as the disclosure provided in the offering memorandum in the event of a misrepresentation. This would include videos, pitch decks and executive summaries companies use when marketing their offering.
  • Investor limits – individual investors relying on the offering memorandum exemption will be subject to annual investment limits – $10,000 for an ordinary investor and $30,000 for an eligible investor. If the securities are sold through a dealer, all investments are subject to suitability, but the annual limit for an eligible investor increases to $100,000 per year, subject to suitability.

Companies will be encouraged to be able to reach the large Ontario investor marketplace, but the regulations are certainly complex and will take a while to digest. The 166 page document contains many more details – some of which pertain to certain jurisdictions. I’m glad the regulations don’t come into effect for a couple of months … it will take us that long to figure them all out!

Stay tuned!

ASC Unveils Startup Business Exemption

ASC LogoToday – amongst all the election noise – a little seen press release was issued from the Alberta Securities Commission … Notice of Publication and Request for Comment for a Proposed Multilateral Instrument 45-109 Prospectus Exemption for Start-up Businesses.

In short – it is the ASC’s answer to the recent Start-up Crowdfunding Exemption recently issued by six other jurisdictions – but better. I haven’t dug deep into the detail just yet, but from my first initial review, I have to say I like it. It has a lot of common sense rules to it – a $1 million capital raise, common sense disclosure, a $5,000 maximum investment from an ordinary investor and the ability to conduct concurrent raises, all through a registrant.

For those of you that remember my older post “The Trouble with the OSC’s Crowd” the ASC has solved many of the issues I have with the OSC’s yet to be implemented version. And, better yet, they don’t even call it a Crowdfunding Exemption – it is simply a Start-up Business Exemption that is directed principally at small and very early-stage businesses and is designed to allow them to raise a defined amount of money in a more cost effective way while still providing appropriate investor protection. It is after all, another tool in a company’s capital raising toolbox.

Our team is currently reviewing the proposed exemption in detail and will work with other stakeholders in providing comment. For now, we are pleased to see this initiative from the ASC. Although they stand on their own (with the Nunavut Securities Office), they have provided some solutions for multi-jurisdictional offerings. Stay tuned – we’ll provide more comments soon.

Regulators need to heed the rise of crowdfunded ‘techquity’ markets

Re-posted with permission from the authors – Keller & Motala. 

Robert Keller is a senior securities lawyer with over a decade of experience in litigation and regulatory policy. Michael Motala is a political economist and law student who comments on the digital economy.

It comes as no surprise that millennials are distrustful of equity markets. The Great Recession continues to cast its long shadow on the labour market for young professionals, and in Canada at least, we are in a technical recession. Tanking commodity prices and schizophrenic stock markets reaffirm the volatility of conventional investment instruments. Squeezed out of traditional career paths, many young people have turned into tech entrepreneurs.

In an economy marked by diminishing venture-capital funds, however, this new wave of young talent is turning to crowdfunding to capitalize their business ventures.

Oculus RiftA prominent example is Palmer Luckey, the 23-year-old virtual-reality inventor who became very rich almost overnight last year, when Facebook acquired his venture, Oculus Rift, for $2-billion (U.S.), leaving his original crowdfunders stunned. The Oculus Rift was an unlikely gamble in 2012. Yet, the success of its original Kickstarter campaign, which sought $250,000 in seed capital, exceeded its target by almost 1,000 per cent.

Some organizations are seeing the writing on the wall and are rising to the occasion. New York’s Nasdaq exchange, for instance, is hoping to capitalize on emerging tech startups in Silicon Valley with the Nasdaq Entrepreneurial Center, a non-profit offshoot that recently opened in San Francisco to help young entrepreneurs connect with experts, mentors and financial backers. At home in Canada, programs such as Ryerson’s Legal Innovation Zone and the MaRS Discovery District are also incubating young tech talent.

Mr. Luckey’s good fortune suggests that crowdfunding offers a valid capitalization model, but it is emerging in untested regulatory waters. Unlike conventional shareholders, crowdfunders generally have few established legal rights in respect of the corporate venture they help create. With equity crowdfunding, in particular, investors generally have little say over the corporate governance of their investments, and little to no recourse when startups break their promises and sell out. Yet, crowdfunding activity continues unabated.

Securities regulators are taking note of emerging peer-to-peer “techquity” markets. In 2012, the United States’ JOBS Act established a right to use online equity crowdfunding portals to raise up to $1-million, but certain restrictions were enacted by the U.S. Securities and Exchange Commission in 2013.

In Canada, regulators have taken an even more restrictive approach. Six provincial authorities issued new regulations on crowdfunding in May of this year, imposing an aggregate limit of $500,000 (Canadian) a calendar year for each startup.

RegulatorsMeanwhile, the Ontario Securities Commission (OSC) pledged it would promulgate its own regulations soon, with a higher aggregate limit of $1.5-million a startup per calendar year. Both, under the final provincial regulations and those expected from the OSC, equity instruments issued through crowdfunding are subject to strict holding periods and sales of these instruments are only allowed under very limited circumstances.

Even if a startup decides to play by the rules, however – say, by establishing a home office in Canada and using a Canadian Internet portal – it remains to be seen whether the crowdfunding limits imposed will spur investment or end up impeding the market. In the public comment process on the new OSC rules, some industry members remarked that the legal and other fees involved in complying with the new regulations could eat up a considerable portion of the capital raised in each deal. Meanwhile, Kickstarter already offers a competitive, low-cost alternative for fundraising in 18 countries around the world, with few to no legal obligations imposed on the businesses raising such funds.

Other challenges arise from the fact that Canada is still a patchwork of different securities regulations. In the 21st century, many find it hard to believe that, in an advanced economy such as Canada’s, securities regulation is still subject to a 19th-century approach to jurisdiction.

Startups have to navigate different equity crowdfunding rules depending on the province in which they intend to raise funds, instead of dealing with a uniform federal market. This leads to inefficiencies, given the greater legal and administrative fees required for complying with different rules in different provinces, not to mention the frequent interjurisdictional conflicts, which only further inhibit the fundraising process.

In any event, strict enforcement of the new crowdfunding rules may not be possible or desirable. In Canada, enforcement resources have traditionally been directed to the most egregious cases. Moreover, Canadian regulators may have little to no recourse against a foreign-based enterprise that is soliciting funds from Canadian residents using a foreign portal. It’s a similar challenge to the one posed by Netflix and Uber: When dealing with businesses that have no physical operations in Canada, Canadian regulatory authorities are hard-pressed to enforce regulatory powers or even court orders against such businesses.

The traditional idea of regulatory jurisdiction is being upended by the Internet and digital innovation. To make matters worse, implementing restrictive guidelines threatens to push away innovators, who will shop for another forum in which to do business.

From taxicabs to liquor stores to cellphones, Canadian regulatory culture seems prone to a certain inertia. Canada’s international competitiveness and economic growth prospects may suffer a high opportunity cost from overrestrictive or inconsistent crowdfunding limits, which may be difficult to enforce in the first place.

But this problem is not unique to equity crowdfunding – it applies to all securities regulation in Canada. If Canadian regulators want to remain effective, they need to heed this new “techquity” reality sooner rather than later.

Originally published in the Globe and Mail, October 2, 2015

VCs | Angels | Investment Funds – Let’s Make Some Noise

As an early advocate and first mover in the equity crowdfunding space in Canada, I am often asked, “Why isn’t Canada embracing this innovative new way to finance early stage business?” While it’s true that we have enjoyed some early traction, we know we need to create a bigger impact and collaborate with other players in the capital raising eco-system to stimulate adoption.

As a bootstrapped, single voice in the market, it hasn’t been easy.

Early this month, we announced we are seeking a small round of seed capital to fund our own traction. It’s not lost on us that we are looking for capital in the “funding gap”, the very stage in the capital raising life-cycle that doesn’t pique the interest of institutional investors, yet is too big for a typical friend and family round – the gap we intend to solve with our platform. We have several expressions of interest from those we have met and we are confident that we will accomplish the raise. But, the answer to the question above, might just be that no one has stepped up to the plate to fund an equity platform in Canada. I mean really fund!

This week, the UK’s two leading platforms, Crowdcube and Seedrs both announced new institutional investments into their companies, bringing their total invested capital to over US$42 million. Major institutions and venture firms have stepped up to the plate to help these disruptive finance tech firms change the way companies access capital and investors find alternative investments. Collectively, they have helped hundreds of companies raised over US$200 million in capital, with the majority of that capital going to early stage companies to accelerate their growth. Many of those companies have been able to grow their businesses, add jobs and create innovative products and services and are stimulating the UK economy. Some have been acquired (providing that all important exit) and others have gone on to IPO.

So, come on Canada, let’s not get left behind. Canadian investors deserve the right to invest in new and exciting ventures and our innovative early stage companies need these investment dollars to fund their next stage of growth. We’re working to make that happen, but we could use a little help along the way! To learn more about our capital raiseclick here.

A word from our lawyers: This communication is for information purposes only and does not constitute an offer to sell or a solicitation to buy any securities, nor should it be construed as a recommendation for any security offering. SeedUps Canada (a registered trade name of Crowd Capital Inc.) assumes no liability of any nature whatsoever for the accuracy or adequacy of any information disclosed herein.
You will not receive advice about the suitability of any security or about the merits of any investment. You should consult legal counsel with any questions about any investment. This communication may contain statements that are not historical facts, referred to as “forward looking statements”. The Company’s actual future results may differ materially from those suggested by such statements.

Are online groceries the next big thing?

Epicured MarketBusiness Insider has just released an in-depth report that looks at how new strategic e-commerce startups and big-name tech companies are pushing to move grocery sales online. Sound familiar?

That’s what Epicured Market’s Jillian Bowman is working toward.

She expects to launch her service, initially targeting the GTA, following her capital raise on SeedUps this summer.  20 million Canadians have digestive health conditions and Epicured Market aims to make it easier for them to make the necessary lifestyle adjustments to treat their digestive conditions with healthy, natural, real food solutions, while saving time and money.

We’ve also recently heard from Yuba, a Calgary-based startup focused solely on bringing 100% local foods to downtown Calgary’s 140,000 consumers. Comprised only of local vendors whose production exists within Alberta, Yuba’s goal is to support small to mid-size food producers while offering Calgarians the opportunity to choose higher nutrient and fresher foods, ensuring their food dollars are reinvested back into the place they live and work.

Shopping Habits are Changing

Busy lifestyles and dietary restrictions are influencing the likelihood that consumers will look to online grocery options. The Business Insider report found that only 15% of U.S. adults have purchased general food items online, but 25% said they have bought speciality food and beverages online, which are hard to find elsewhere.

The Market Outlook

Blue Apron, a U.S. company that packages up perfectly portioned ingredients and recipes that are delivered to your home once a week has been killing it of late. Early this month they announced a $135M round of funding at a $2B market cap. Sounds like the market is heating up! According to Business Insider Intelligence, between 2013 and 2018, online grocery sales will grow at a compound annual growth rate (CAGR) of 21.1%, reaching nearly $18 billion by the end of the forecast period. For comparison, offline grocery sales will rise by 3.1% annually during the same period. It looks like the grocery sector is about to get a shake up!

Check out Epicured Market on SeedUps and read the full BI Intelligence article here.

This communication is for information purposes only and should not be regarded as an offer to sell or as a solicitation of an offer to buy any financial product.Securities offered through Waverley Corporate Financial Services Ltd., an Exempt Market Dealer registered in certain Canadian jurisdictions. Investment opportunities on SeedUps Canada are suitable only to investors who are qualified to purchase the securities and who are familiar with and willing to accept the high risk associated with private investments. You will have to complete and sign additional documents to determine your suitability to make an investment. The Epicured Market offering is available for investment to qualified and suitable accredited investors only.

There’s a New Way for Companies to Raise Capital from the Crowd

CrowdfundingOn May 14th, six Canadian provinces jumped into the equity crowdfunding space in a big way. BC, Saskatchewan, Manitoba, Quebec, New Brunswick and Nova Scotia announced a new prospectus exemption for early stage companies to raise capital. When I first read the press release, I have to admit, I wasn’t that excited. But, after chatting with the regulators and reviewing the documentation, I’m warming up to the idea.

It is obviously disappointing that once again, the provinces aren’t aligned in this exemption, but we are used to that in Canada. Although Ontario says they will not be part of it, Alberta is suspiciously quiet at this time, so maybe we’ll hear something from them soon. Overall – I think they may have it right. Here’s what I know at this time:

  1. Financial reporting – early stage companies will no longer be required to present financial statements prepared by outside accountants that conform to GAAP or IFRS standards, a costly, and frankly unreasonable task for companies that have had little or no financial history to date. We work with early-stage companies every day – companies that are seeking “go to market” funding in the range of $250K – $1 million. I’d say the financial requirement is the single biggest obstacle they face today. This is indeed good news.
  2. The Offering Document – is straight forward for a company to complete and clear, concise and easy for investors to read and review. I like the standardized format. We’ve already created a Form 1 “Start-up Crowdfunding – Offering Document” template. Download your copy here.
  3. The Maximum Raise – of $500,000 ($250,000 at a time) sounds reasonable to me – that capital, combined with capital from Friends and Family, Angels and Accredited Investors can certainly help most early stage companies gain some traction and aligns nicely with the reduced disclosure as identified above. The average capital ask on our platform is currently $600,000 – so it seems that the regulators have it right on this one too.
  4. The Maximum Investment – OK … this might be the one area where they got it wrong. $1,500 is a really small number. The average investment on the SeedUps platform today sits around $4,000. Remember, this isn’t the minimum investment, it is the maximum investment. I think it is an arbitrary number, and one that should be re-evaluated in the near term. Concurrent raises can balance out the average investment, but many eligible investors will wish they could invest more in early stage companies they believe in.
  5. Concurrent Raises – companies can raise capital under another exemption concurrently with this exemption and contribute those investments to the minimum raise in order to close the offering. This means that Angels and other sophisticated investors can participate in the capital raise. (One caveat – a non-regulated “funding portal” can’t execute the purchase under another exemption – but an EMD that is offering the securities could).
  6. Eligible Securities – the commissions have provided great flexibility in terms of the types of securities offered. In addition to common shares, companies can issue debt, convertible debt, preferred shares and limited partnership units. These alternate forms of capital, or combinations thereof, can make sense for certain early stage companies wishing to delay their valuations until a later date.

Bottom line – at SeedUps Canada, we’ve always advocated for lowering the cost of raising capital for early stage companies, without compromising investor protection. This new exemption does just that. Now, when raising capital, companies have several options at their disposal. We’re excited about the prospects for the companies we are working with. Stay tuned!

How to Raise Capital from the Crowd


So you’re ready to access new capital to grow your business.  Do you know what it takes to successfully raise capital?  It takes more than just a good idea and a good story.  You’ll need to be fully prepared.  You must comply with securities regulations, corporate governance and present your investment opportunity in a clear and transparent way.  Here are some steps to consider as you prepare your pitch.

Corporate Governance

Is your business incorporated?  Do you have the appropriate articles to support issuing shares in your company?  Do you have a board of directors (including some independents) or an advisory board?  As they say – you need to get your business affairs in order prior to reaching out to the public for investment.  You’ll also have to consider the type of shares you are offering and the amount of equity you are offering for the investment.

Investors will have to complete documents including subscription agreements, risk acknowledgement forms and validate their qualifications to invest in your offering.  Fortunately, SeedUps Canada provides online execution of these documents, making it an efficient and compliant environment to raise capital.  Be sure to seek the appropriate legal and financial professionals to help you organize your fundraising.

Compliance – Securities Regulations

SeedUps Canada is a CrowdFinance platform.  That means you raise money in exchange for shares in your company.  Selling securities is regulated by the various securities commissions in Canada and companies raising capital on the SeedUps platform must offer their securities under one of the following prospectus exemptions:

  • Offering Memorandum (OM) Exemption
  • Accredited Investor (AI) Exemption

The Offering Memorandum Exemption

The Offering Memorandum – Form 45-106F2

In Canada, private companies can raise capital from the public – meaning the Crowd – through an Offering Memorandum (OM) exemption. The OM is a document that provides information about your company and the shares you are offering to investors. The document contains disclosure about:

  • the business of the company,
  • the company’s financial and material facts and contracts,
  • the directors, management and promoters,
  • the securities offered,
  • the risks of the investment, and
  • how the money will be used

It is a legal document of a prescribed format that gives rise to significant legal obligations on the part of your company. Like any other important legal document, it should be prepared with the assistance of an experienced securities lawyer who has a thorough understanding of your business.  We’ve created an OM template that you can review and complete so you are well prepared prior to engaging legal counsel, often times resulting in reduced legal fees. Download template here.

Risk Acknowledgement Form 45-106F4

Each investor must complete a Risk Acknowledgement Form that accompanies the OM.  We have sample forms for you to discuss with your legal counsel.

Subscription Agreement

Each investor must sign a Subscription Agreement that forms part of the OM.  We have a sample subscription agreement for you to discuss with your legal counsel.

Need legal advice?  Check out our participating partners.

Financial Statements

The Offering Memorandum must include audited financial statements prepared in accordance with Canadian GAAP or IFRS for publicly traded companies.  If your company is located in Alberta and you are only looking to raise up to $500,000 in capital, you have the option of offering your securities under a Blanket Order (OM Blanket) whereby the financial requirement is relaxed to allow for non-audited financial statements that are prepared in accordance with Canadian GAAP or IFRS applicable to private enterprises.

Need accounting advice?  Check out our participating partners.

The Accredited Investor Exemption

The Accredited Investor Exemption gives a company the ability to raise capital from high net worth individuals.  These investors are deemed to be sufficiently knowledgeable of investment matters therefore do not need the protection of securities legislation.

Only 3% of the Canadian population qualifies as an accredited investor, so pitching your company’s offering to this limited audience may not be your best approach.  Although the disclosure required in this type of offering is much less than that of an OM offering – the potential of a successful offering may also be reduced.

Is an offering document required?

No, there is no requirement to prepare and present an OM for an offering made to accredited investors.  Most companies will prepare a document that has pertinent information about the business, its market and competitive advantage. While there is no requirement or prescribed format for an offering document, potential investors will want to understand enough about your business to make an investment.

Risk Acknowledgement Form 45-106F9

Beginning May 5, 2015 all accredited investors must also complete a Risk Acknowledgement Form.  We have sample forms for you to discuss with your legal counsel.

Subscription Agreement

Each investor must sign a Subscription Agreement that clearly quantifies how the investor meets the accredited investor standard.  We have a sample subscription agreement for you to discuss with your legal counsel.

Need legal advice?  Check out our participating partners.

Due Diligence

Waverley Corporate Financial Services Ltd (Waverley) is a registered Exempt Market Dealer and handles all securities related activity on the SeedUps Canada platform.  Waverley has an obligation to understand the structure, features and risks of the securities offered by your Company.  As part of due diligence, we will gather certain documentation to present to Waverley including:

  • Background checks on key Officers and/or Directors
  • Certificate of Incorporation or Partnership Agreement
  • Underlying Organizational Documents (Articles of Incorporation, relevant shareholders’ agreements, employment contracts, etc.)
  • Detailed Business Plan
  • Detailed Pro-forma Projections
  • Investor Deck
  • Pre and Post Financing Capitalization Tables, and
  • Other supporting documents

Valuation

How do you know what your company is worth? It’s a challenge for early stage companies that may be pre-revenue or just going to market. At SeedUps, we have an alliance with Equidam, a platform for business valuation that allows you to better estimate your future and compare your company with others. Your company valuation is computed using 5 different quantitative and qualitative methods based upon your input and the best financial data available.

It’s free to generate an executive summary and SeedUps referral companies receive preferred pricing for an annual subscription with Equidam, where you can

download the full 16 page document at every stage of your company’s development.  Click here for more details.

Marketing Materials

Video Production

A video pitch is a powerful tool for you to communicate your investment potential in a succinct and compelling manner. It will help bring your business to life, show that you are serious and add credibility to your pitch. You don’t need to be a professional videographer to make a short video these days and by doing one you will surely increase your chances of success.

Need help? Check out our video production partners.

Investment Deck

A presentation deck that succinctly describes the investment opportunity and why an investor should be interested can help market your opportunity. You should ensure that the information in your presentation is consistent with the information provided in your offering documents.

Media and Press Releases

If your company has be recently covered in the press – we can post links that can be shared with our investors.

Marketing Plan

We’ll work together with your team to prepare a marketing plan that will include social media, email marketing, blogging and events. To learn more about preparing for your pitch – review our Pitch Checklist.

Offering Costs

Offering Documents

If you do not have any of the Required Disclosure Documents prepared, you will incur professional services fees to prepare and present the documents.  Although the fees can vary relative to the preparedness of the company, the complexity of the business and the choice of professional firms, we would suggest that these fees can range as follows:

  • Accounting – $2,500 to $10,000
  • Legal – $2,500 to $20,000

These fees are generally required to be paid prior to the capital raise, so your Company should be prepared for such costs.

Success Fees

If you comply with all of the requirements to present your offering on the platform and Waverley signs off on due diligence, your Company will incur an onboarding fee of $3,200 and a $10 “per investor” fee payable to SeedUps Canada and a success fee of 5% payable to Waverley at the time of closing (when you get your money).

Moving Forward

If you are prepared to move forward with us, we will present you with Engagement Letters outlining the terms of our agreement and begin the steps required to present your offering on the platform.

Paperless Paperwork

Have you already found your investors? The SeedUps platform has all the tools you need to execute your private capital raise quickly and accurately. With our platform, companies, securities lawyers and other advisors have an integrated solution that makes it easy to move the capital raise online. Ask us about Paperless Paperwork.

New Live Deals Launch on SeedUps Canada

Jump On and BeautyGram launched this week on SeedUps Canada. Only registered investors can view offering details, so register now to learn more about our latest featured companies.

The Jump On Story

Jump On is something entirely new in the travel industry. It uses the power of online group buying to ensure a win-win situation for both the industry and travellers. The bottom line is that charter airlines keep their planes busy and customers get convenient weekend getaways at a great price. Think Uber for the skies.

What is a BeautyGram?

It’s an alternative to the traditional option of sending flowers and chocolates to women. Consumers select pre-made or customizable gift packages through a user friendly e-commerce site BeautyGram.com. The BeautyGram’s are package in the Company’s signature pink packaging and delivered to the recipient’s door.

 

Register as an investor to review, evaluate, follow and even invest in your favourite profiled companies. You’ll be able to join the discussion forums, chat with other investors and invite friends and colleagues from your own networks to join the Crowd. So, register now to learn more about our unique online investment platform.

This communication is for information purposes only and should not be regarded as an offer to sell or as a solicitation of an offer to buy any financial product.Securities offered through Waverley Corporate Financial Services Ltd., an Exempt Market Dealer registered in certain Canadian jurisdictions . Investment opportunities on SeedUps Canada are suitable only to investors who are qualified to purchase the securities and who are familiar with and willing toaccept the high risk associated with private investments.  You will have to complete and sign additional documents to determine your suitability to make an investment.

Perspective: The Core Mission of Crowdfinance

On March 10, 2015, Dara Albright posted an insightful article on Crowdfund Insider. She and I share a similar belief – that crowdfinance is an important and inevitable shift in the capital raising ecosystem. I seriously couldn’t have said it better myself. 

Here’s Dara’s take …

I spend many waking hours advocating for crowdfinance and preaching about the economic repercussions of an unjust financial system that inhibits entrepreneurs from procuring growth capital and restrains unaccredited investors from acquiring higher yielding private securities.

I’ve dedicated more than four years to this endeavor because I wholeheartedly believe that a fundamental shift from institutional to crowd investing is crucial to preserving the capitalistic principles that fuelled centuries of global innovation and upward mobility.

Because the fate of future generations depends upon the success of this mission, it is imperative that the underlying purpose of crowdfinance doesn’t get lost in the industry’s unbridled enthusiasm or lapses in judgement. Crowdfinance emerged in response to deficiencies in capital formation. Through the melding of technological achievement and regulatory easing, crowdfinance is able to offer a more practical solution to enriching the capitalization process.

Crowdfinance provides businesses with the unprecedented ability to crowdsource inventions, pre-test product launches, gauge consumer demand and convert consumers into loyal stakeholders. This process gives weaker companies the chance to rectify flawed products or business models prior to raising sizeable rounds of capital. It also helps ensure that sounder startups make their way to a larger pool of investors.

Read the rest of the article at Crowdfund Insider here.

This article originally appeared on Crowdfund Insider.