Tagprivate equity

FrontFundr and SeedUps Canada announce partnership

CALGARY / VANCOUVER – February 15, 2018: Four years ago, two visionaries began the process of reducing barriers for Canada’s early stage companies accessing growth capital. They each developed unique models to tackle this challenge, working closely with securities regulators and gaining buy-in from the early stage ecosystem. They have now come together to leverage their experience and momentum and help more companies and investors throughout Canada.

 

One, Sandi Gilbert, developed a suite of technologies that simplified the complexities of capital creation and management with a focus on the angel investing community. The SeedUps platform, and its deal flow app AngelBot, has showcased over 50 companies to its angel network; and DealPoint, a SaaS solution for the private capital markets, has transacted over $4 million in exempt investment since its launch late last year. Next up – a blockchain solution where entrepreneurs and investors can manage their shareholdings post raise.

 
The other, Peter-Paul Van Hoeken, created FrontFundr, a national Exempt Market Dealer with a proprietary online platform that democratizes Canada’s private capital markets by allowing all Canadians to invest in early stage and growing private companies. FrontFundr has emerged as Canada’s clear leader, having assisted more than 20 companies to raise a combined total of over $8M from a wide range of Canadian investors – not just the 1%. This initiative has unlocked capital across Canada and broadened investor access to a multitude of opportunities.

 
SeedUps and FrontFundr have now partnered to provide entrepreneurs with a full suite of tools to access the resources and capital they need to grow and scale their businesses. This partnership will help entrepreneurs prepare for and engage with a wide range of new investors; from retail to angels to institutions and investment funds – online and offline. Post investment technologies to help companies and their shareholders better manage their investments will bring transparency to private investing overall.

“Peter-Paul and I have long had similar visions to help entrepreneurs access capital in what we call the ‘funding gap’”, states Gilbert. “By matching our resources with an entrepreneur’s needs, we can increase the probability of a successful outcome for the entrepreneur and its investors”.

“This partnership supports our joint mission to truly democratize investing in private companies in Canada. We are bringing together professional venture capital and everyday Canadians to invest in companies that they believe in” says Van Hoeken.

Entrepreneurs are an essential contributor to the Canadian economy, with small business representing over 98% of businesses in Canada. New models of support and access to capital are critical for Canada’s growth.

Interested in exploring investment opportunities for all Canadians, visit FrontFundr.

If you are a growing company preparing to capital raise, visit SeedUps Canada.

For further information, please contact:
Sandi Gilbert – sandi@seedups.ca

Peter-Paul Van Hoeken – peter-paul@frontfundr.com

 

2017 Developments Indicate Good News for 2018

2017 brought new opportunities to Canada’s early stage companies and the investors looking to support the space. Entrepreneurs have more and more opportunities to find mentors, collaborate with other stakeholders, share co-working spaces, educate themselves and find capital to grow and scale their businesses. Here’s some highlights of this year.

Alberta adopts an Investor Tax Credit – after years of watching our neighbors to the west reap the benefits of an investor tax credit, the government of Alberta announced our own 30% investor tax credit to spur investment into innovative companies that have the potential to diversify our economy, increase exports and add much needed jobs to our economy. The program has rocketed to a fast start with only $5 million of tax credits left in the 2017 budget ending in March of 2018. With another $60 million in credits available over the next two years, that equates to another $180 million of investment dollars for Alberta companies.  Learn more.

The Rainforest is in full bloom – 18 months in, the Rainforest continues to gain momentum. The mission …  to support Alberta’s entrepreneurial eco-system by creating an environment that means Albertans don’t have to move away to invent, prosper, and move their ideas forward.  Learn more about the Rainforest and sign the Social Contract.

Creative Destruction Labs, Rockies (“CDL”) – launched its first cohort of 25 companies in the “Prime” stream. The Prime stream is industry agnostic, with startups tackling problems in healthcare, finance, energy, chemical, media, transportation, and agriculture sectors, amongst others. Technologies in the Prime stream include advanced engineering, electronics, blockchain, nanotech, neuroscience, and general IT applications. CDL has assembled a list of impressive advisors and partners to mentor the teams through the program. Learn more here.

Google’s DeepMind comes to Canada and sets up shop in Edmonton – DeepMind, in collaboration with the University of Alberta opens its first ever international AI research office in Edmonton. Known for its AI talent, the new office will continue to train the next generation of AI researchers and help keep the much needed AI talent right here in Alberta. DeepMind Edmonton.

RocketSpace is coming to Calgary – in 2017, RocketSpace, one of Silicon Valley’s most successful co-working campuses focused on scaling tech start-ups, announced their first campus in Canada and named the Edison as their home in Calgary. RocketSpace recognized that Calgary has everything that RocketSpace startups are looking for in a headquarter city. It is a city of solutions-first thinkers, engineers, and entrepreneurs — and we’re here to support them every step of the way. Their new state-of-the-art tech campus in Calgary will provide velocity — both speed and direction — to Canada’s top tech startups so they can scale up even faster. Learn more.

Alberta’s co-working trend continues to grow  – Calgary and Edmonton continue to see new co-working spaces opening, serving all types of entrepreneurs and professionals looking for convenient and flexible office space to grow their businesses and network with peers. Check out Calgary’s Co-working spaces, Incubators and Accelerators and the Co-work Edmonton for space that fits your culture and budget.

Canada’s New $100-Million Procurement Program for Technology Startups

Sandi Gilbert, Mike Tremblay, Minister Bardish Chaggar, Minister Navdeep Bains at Invest Ottawa, December 14, 2017

I was pleased to be part of the $100 million Innovative Solutions Canada announcement in Ottawa on December 14.The New program has over $100 million dedicated to supporting the scale up and growth of Canada’s innovators and entrepreneurs by having the federal government act as a first customer. Twenty participating federal departments and agencies will set aside a portion of funding to support the creation of innovative solutions by Canadian small businesses.

Under the program, federal departments and agencies will fund up to $150,000 for a proof-of-concept study and $1-million to fund development of a prototype.

We often say that “first customer” goes a long way to validate a company’s products or services, making it easier to enter markets, both nationally and globally. We encourage all entrepreneurs to regularly check the program’s site at Innovation Solutions Canada to review contract opportunities and submit their proposed solutions.

BDC launches Women in Technology Fund – BDC wants to foster the creation of the next generation of millionaire Canadian women technology entrepreneurs. With $70 million to be invested over 5 years, it’s the largest venture capital fund in North America dedicated solely to investing in early stage Canadian women led technology companies across sectors. The fund will support women-led tech firms in equity at the seed stage, Series A stage and sometimes at the Series B stage, alongside accelerator partners, investors and other corporate venture partners, as part of a syndicate or as a lead investor. Learn more here.

No excuses entrepreneurs and investors – get out there and take advantage of the opportunities. 2018 looks to be a good year indeed!

NACO gets a new Board Chair and Ottawa learns about Angel Investing

It’s been a busy start to the fall here at SeedUps and we thought we’d share a few updates and news.

In October, Montreal was host to the NACO World Angel Investment Summit, where over 500 investors, partners and industry leaders from around the world gathered together to learn about emerging trends shaping Angel investment. The event marked my official appointment as the Chair of the Board of Directors of the National Angel Capital Organization and I am honoured to work alongside a strong and capable board and growing staff at NACO. We’ve broadened our mandate to welcome Canada’s Incubators and Accelerators into our organization as we expand our support for angels and early stage companies seeking growth capital. Victoria will host the Western Regional Summit February 21 – 23, so be sure to put it in your calendar now.

Earlier this month, I made a quick trip to Milano to attend an Italian government sponsored start-up event with 21 investors from around the globe. Upon returning from there, Yuri Navarro, NACO’s CEO and I headed to Ottawa to meet with key ministries to share our members’ concerns over the proposed tax reforms, particularly as they relate to the use of private corporations when investing in start-ups. Our meetings were a follow-up to our written response submitted on October 2nd. We believe our voices are being heard and await further clarification from Ottawa on how they intend to ensure these reforms do not adversely impact angel investment. Download a copy here.

Featured Company News

RallyEngine

Steve Hardy, RallyEngine’s President & VP Marketing shared recent developments with us last week, stating that the Company has signed a prominent diplomatic client, pitched one of the largest resort groups in the world and is now nearly confirmed as a 100 Resilient Cities official partner. RallyEngine is in market now for a Seed Round. Learn more.

RateSeer Technologies

Donna Tilden, RateSeer’s Founder & CEO has just returned from FinovateFall 2017 in NYC where she and Head of Business Development Brian Smith presented their Denoti financial services platform to an engaged audience. Watch presentation here.

New VCC to invest in Alberta start-ups

Crowd Capital has been approved as a Venture Capital Corporation by the Alberta Investor Tax Credit Program. Our micro-venture fund will invest in Alberta’s innovative early-stage companies led by extraordinary talent with big ideas and big markets. Learn more.

Save the Date

NACO’s efforts to increase collaboration between early-stage community members will be in full swing at our 2018 Western Regional Angel Summit in Victoria BC.

So, save the date – February 21 – 23, and join us for a packed agenda to highlight Victoria’s thriving tech scene. Registration will open soon.

SeedUps Canada Team Launches Technology for Exempt Offerings

In 2012, our team of ex-bankers, entrepreneurs and technology geeks had an idea. Wouldn’t it be great if companies could raise capital and close private placements on-line? After all, our team had investment banking experience, were long time entrepreneurs and had built businesses that embraced technologies that made products better and made the delivery of services more efficient. We knew how complicated and time consuming a paper based capital raise was. So, how hard could it be?

In 2014, after extensive research and development, we deployed our first solution, a crowdfunding platform called SeedUps Canada. It was licensed by an Exempt Market Dealer and was the first Canadian platform to execute private placements on-line, embracing the new world of equity crowdfunding. By August of 2016, we recognized that crowdfunding in Canada was off to a slow and complex start, so we left the crowd behind and turned back to our entrepreneurial roots, and focused on helping early stage companies access the resources they need to plan and execute a strategy for long term business success, be that capital, mentorship or connections.

We learned a few things in our ‘first mover’ stage. We knew we had a winner with our technology. The fact that you could actually execute a subscription agreement on-line was exciting for issuers, their lawyers and their agents. Our original vision of bringing technology to the private capital markets was a reality. We just needed to refine the model to match the needs of the industry.

“Imagine dealing reps armed with iPads instead of notepads”

So, with a major client onboard, we re-engineered the on-line process to meet the needs of issuers and their agents and last month, deployed DealPoint, a SaaS solution that streamlines the execution and closing of private placements. The platform offers ‘white label’ solutions where issuers and their agents can present details about their exempt offerings in private, branded dealrooms accessed by ‘invitation only’. Investors are directed to dealrooms to execute subscription documents, initiate the opening of registered plan accounts and complete investor onboarding in accordance with their own internal policies and procedures.

iPad instead of notepadImagine, dealing representatives armed with iPad’s rather than notepads. They can walk through the on-line investment process together with their client, or send them a link to do it on their own. Investors are presented with the appropriate subscription agreement and other supporting documentation based on their exemption and their jurisdiction. When they complete an on-line conversation, the documents are generated and presented for signature. It’s the right document every time.

“A compliance console to track approvals and investments”

When the investor has executed their documents, the dealing representative and CCO login to the compliance console where they conduct a review of the investor paperwork and document the suitability process. When the private placement is fully subscribed, the issuer, their agent and their legal counsel access data and documents to proceed to close. The platform has API integrations to facilitate the uploading of completed documents to external investor dashboards, making the entire process seamless and transparent.

“Private capital – simplified”

DealPoint Data RoomWe’re excited to bring DealPoint to market. We’ve launched, but we aren’t done. The power of moving online means that it has become easier to connect, to access information and interact seamlessly. DealPoint provides increased transparency among all stakeholders involved, making raising private capital faster while driving costs down.

With DealPoint, all stakeholders have an integrated solution that makes it easy to move the private capital raise on-line. The company plans to deploy more technologies for the exempt market. Our goal is to listen to the needs of the industry and continue to develop and deploy fintech solutions that support the private capital markets. For more information or a demo of DealPoint, go to DealPoint.ca

We’re hiring! Check out our careers page.

What Can Europe Teach Canada About Equity Crowdfunding?

Nathan Rose, Assemble Advisory

The content of this article has been adapted from Equity Crowdfunding: The Complete Guide For Startups And Growing Companies, launching on Amazon on November 1. SeedUps subscribers can download the entire book for FREE, this week only. Click here to download.

As Canada’s nascent equity crowdfunding market struggles along, the European market continues apace. There have been many more successful fundraisings on the other side of the Atlantic Ocean – Europe (and particularly the United Kingdom) accounts for a very large part of the approximately US$2 billion equity crowdfunding market, according to Cambridge University.

In my new book, I spoke with over a dozen successful crowdfunders, representatives from the leading European platforms, and a number of other experts at the forefront of the equity crowdfunding revolution. There were contributions and case studies from the United Kingdom, France, the Netherlands, Germany, Sweden, Finland, and Estonia.

Here is a sample of some of the key takeaways, and insights that Canadians can learn from their European cousins.

  1. Equity crowdfunding works best when a strong relationship already exists with your crowd.

“We didn’t really build our crowd through crowdfunding. We already had built our crowd, so crowdfunding was simply an opportunity to deepen that relationship.”

– Tom Blomfield, Monzo, raised £1 million on Crowdcube (UK-headquartered platform).

  1. To get journalists interested, you need to be doing something unique or special – just doing a crowdfunding campaign won’t interest media anymore.

“Everyone by now has heard of crowdfunding. To get journalists interested, you need to find your own unique take on it. Create the story. Ask yourself why should readers care about yours?”

– Charlie Thuillier, Oppo Ice Cream, raised £650,000 on Seedrs (UK-headquartered platform).

  1. A lot of work needs to go into outreach, even before your campaign starts. If you want to run an equity crowdfunding campaign in the future, begin warming up your community NOW.

“We spent two years of work building our community, and to get the media explaining how our technology works and why we do what we do. I do a lot of events and conferences and meet a lot of people. That’s why we were successful.”

– Sandra Rey, Glowee, raised €611,000 on WiSEED (France-headquartered platform).

  1. Having a ‘lead investor’ before your public campaign kicks off will hugely improve your chances. It means your campaign will start with momentum, and investors will have more confidence if you have a ‘smart money’ backer.

“We contacted several potential investors before launch. It was crucial to have some money already, so that when the people were directed to our campaign page through our social media, they wouldn’t be directed to a campaign with nothing yet committed. Investors saw that we had 50% of our target already raised on day one.”

– Jarno Alastalo, Heimo, raised €170,000 on Invesdor (Finland-headquartered platform). 

  1. Equity crowdfunding can have transformational positive benefits. Some campaigns even believe the exposure was even more valuable than the money they raised.

“The overall impact on our business has been incredible. We got great press coverage, and a huge number of new people have heard of us as a result of crowdfunding. I just wish that we had raised more!”

– André Moll, MyCouchbox, raised €300,000 on Companisto (Germany-headquartered platform).

In 2016 we saw more countries embrace the opportunities that equity crowdfunding allows – including in the United States where Title III crowdfunding came into force in May. And in Europe, there is a strong push for additional equity financing for companies and innovative projects, aided by supportive regulators.

When different equity crowdfunding markets learn from each other, each of them will become stronger. Despite regulatory differences, running a campaign has much in common between countries, so taking note of what is working elsewhere in the world will have strong applicability for Canadian campaigns too.

If you enjoyed this article, you can read a comprehensive overview of equity crowdfunding by downloading Nathan Rose’s new book, FREE on Amazon for this week only, featuring even more insights from SeedUps and many other interested participants in the crowd economy from around the world. Click here to get your copy.

 Nathan Rose Nathan Rose is the founder of Assemble Advisory, an agency for companies wishing to pursue equity crowdfunding campaigns, and the author of the upcoming book: Equity Crowdfunding: The Complete Guide For Startups and Growing Companies.

 

The Evolution Continues

SeedUps Canada platform evolves to increase deal quality and investor interest

The collaborative funding model emerges as best fit for entrepreneurs and investors

For the past three years, we’ve been at the forefront of advocating for change in the way Canada’s early stage companies access capital and engaged venture investors find investment. Credited as the technology that supported the “First Ordinary Investor” to take an online stake in a private company, the team at SeedUps has been encouraged by the innovation movement taking hold in Canada and the regulators’ efforts to expand capital formation for early stage companies.

We’ve also been engaging with other stakeholders in the funding arena, specifically the Angels and early stage Venture Capital firms (“VCs”) that supply much needed growth capital to our passionate entrepreneurs. We’ve continued to advocate that SeedUps is not a competitor, rather a technology-enabled resource to help them fund their chosen companies faster and more efficiently. Although quick to recognize and invest in disruptive technologies in their portfolios, they have been slow to embrace technology for their own financing processes.

We’re now two years down the road and much has changed. The securities regulators have implemented complicated “crowdfunding” rules that create confusion for both the company raising capital and the investors wanting to invest. Three different regulations and three different registrant models adopted by select provinces have resulted in much confusion and low adoption by the industry as a whole. These new regulations may even result in companies taking on funding from hundreds of new investors without realizing the post raise obligations of managing those investors or more importantly, the ongoing reporting requirements built into the new regulations. These two issues alone, may prevent a crowdfunded company from accessing their next round of capital. Not the intended outcome.

Startupfest Montreal BDC Video

Watch the BDC Video

While the regulators seem to have missed the mark, the industry seems to be getting it right. I recently attended and spoke at Startupfest in Montreal and was encouraged to see participation from all players in the capital raising eco-system. Ryan Eakin, our peer at CircleUp says it best, “If you are supportive of helping entrepreneurs thrive, creating more opportunity for more small businesses across the country and spurring economic innovation, you want to bring all parties to the table. You just want to do it in a more transparent, open way, not a historical old boy’s network that has led to disproportionately fewer new ideas being funded.”

The SeedUps technology platform allows this to happen. Early stage private capital has traditionally been funded by a small group of high net worth individuals ready to take a risk. By using our technology, companies can access a broader group of individuals that may want to invest smaller amounts alongside these investors. Angels that want to fund a company, yet don’t have enough cheque writers at the right time, can present their companies to an engaged investor community to fill the round. VCs can find additional capital for their portfolio companies – all in an efficient, transparent manner.

For companies trying to access Angel or VC capital, SeedUps provides the tools to prepare and present their opportunities to this important source of funding. We can also direct companies to our partners like banks, online lending platforms and government funding programs for those that can support this type of financing. With over 700 companies applying for funding on SeedUps, we know that many of them are not ready to face these investors. As a result, we have developed an Investor Readiness Program (“IRP”) that helps these companies prepare to face investors that ask the tough questions. The result, an increased chance of a successful capital raise – a win-win for the investors and the entrepreneurs alike.

So, we’re leaving the Crowd behind us – for now.  We’ll continue to advocate for positive change that makes it easier for companies to access capital and for investors to have the freedom to invest in companies they believe in. We even have a few ideas in the works. As of now, it’s simply our opinion that the crowdfunding rules implemented by the various securities regulators to date do not work. They are in fact, as some might say, Dead in the Water.

An Exciting New Way to Invest

SeedUps Canada is an online investment crowdfunding platform where ordinary individuals and sophisticated investors come together to discover, evaluate and invest in growing companies. Companies raise capital through a secure platform where they can pitch, attract and close investors. Investors execute investments online, and stay informed of investee companies’ activities. It’s a disruptive model that is changing the way individuals can invest, and companies find investment.

Become an investor

Companies on SeedUps take advantage of new capital raising rules allowing them to reach out to all investors, not just the usual suspects. By reaching out to their peers, founders can attract investors and validate their product or services at the same time. So now, you too, can invest in your favourite private company.

It’s simple and free for anyone to sign up. Once your investor profile is complete you’ll be able to access eligible campaigns where you will find videos and pitch decks, ask entrepreneurs and management questions, request further information and invest – all in a secure online environment.

Three tiers of investors

Generally, there are three types of individual investors that can invest on SeedUps. It’s simple and free for anyone to sign up. Simply answer a few questions to complete your investor profile and you’ll be able to access eligible campaigns, ask entrepreneurs and management questions, request further information and invest. Your ability to invest is driven by:

  • where you live
  • the type of investor you are
  • the type of offering, and
  • the amount that is suitable for you based on your investment portfolio and financial circumstances
Accredited Investors

AngelTom is an executive at a Fortune 1000 company. He earns over $200K a year ($300K with his spouse) or has at least $1M of financial assets. He’s invested in private companies before but is looking for dealflow. He has no investment limits.

Eligible Investors

EligibleJane is a business analyst at a consulting firm. She earns at least $75K ($125K with her spouse) or has at least $400K of net assets. She wants to start investing in private companies. Her maximum investment ranges from $1,500 to an unlimited amount.

Ordinary Investors

Crowd_GreenRobert is a developer at a technology firm. He earns less than $75K per year and is new to investing.He’s passionate about technology and wants to start investing in companies he finds interesting. His maximum investment ranges from $1,500 to $10,000.

Moving investments on-line

There’s a new generation of investors that are embracing the private capital markets, feeling empowered by choosing their own investments. Technology has changed the way companies find capital. Companies can now save time and money by pitching their deal to an interested online audience where investors browse through engaging company deal rooms, watch videos, review customized investment documents and execute transactions online.

It’s like Dragons’ Den and E*TRADE combined.

Each company has a target and maximum raise. Your investment is not released until the raise has reached its target. At that time the money is sent to the company and you become an shareholder in the business. If the target raise is not met, your funds are returned to the account from which they were drawn.

Deal Review and Vetting

brokersCompanies profiled on SeedUps have been reviewed and vetted by Waverley Corporate Financial Services Ltd. Before a deal goes live, the company is subject to a due diligence process to validate the company, its management, directors and its business model. The company is required to submit financial forecasts that are reviewed to ensure they are a fair and reasonable reflection of the business as it currently stands, and that their forecasts are backed by reasonable thinking and assumptions.

You should carefully review the information provided in the company profile and consult a financial advisor with respect to your ability to withstand a loss of your investment. There are no guarantees that your investment will deliver returns.

What You Own

sharesTypically, investors receive common shares issued directly by the company.  These shares represent an ownership stake in the company. If the business is sold, you are entitled to a percentage of what is earned in the sale of the business. In addition, if there is a dividend, you receive your share of the distribution.

In other cases, investors may receive preferred shares, limited partnership units or convertible debt in the company. The rights of these investors will differ from above, so be sure to carefully review the offering documents presented in the business profile. Be sure to read the offering documents to understand the terms of your investment and consult your personal advisor if you have any questions.

Ongoing Communications

ChatYou are investing in private companies that, in most cases, do not have an obligation to publish financial statements or provide quarterly updates. These companies do understand the importance of regular communications and our technology makes it easy to get messages out to their shareholders.  In any event, we send regular updates to our investor base and we’ll be sure to keep you up to date with the information we have on the activities of the companies that successfully raise capital on SeedUps.

Why Invest in Companies on SeedUps

Idea_1The SeedUps investor community invests for a number of reasons. Typically, they want to support a business or industry they are interested in, or they want to invest in a management team that has a track record of success. They understand the risks and rewards of investing in private companies and want to put a small portion of their investment portfolio into companies they believe in. Our registered users include first time investors, angels and early stage venture funds.

On SeedUps, you can invest in a diverse variety of industry sectors and select a company that resonates with you. It’s easy to browse profiled companies and make an investment online. The platform guides you through the investment process, seamlessly and efficiently.

Investing in Private Companies is Risky

launchInvesting in private businesses is risky, but the returns are potentially high if you diversify and invest in companies you understand and interest you. When you invest in companies on SeedUps your risks include illiquidity, lack of dividends, loss of investment and dilution. You should only invest in these businesses as part of a diversified portfolio. Investment opportunities on SeedUps are suitable only to investors who are qualified and suitable to purchase the securities and who are familiar with and willing to accept the high risk associated with private investments.

Investors should implement a diversification strategy that involves spreading your money across multiple investments. There are no guarantees that your investment will deliver returns. If the company goes out of business, your shares will be worth nothing.

The impact of investment crowdfunding

Developments in technology and regulation mean that now, SeedUps can offer a variety of investments for small investors – both equity and debt. We provide the missing link that connects companies to an untapped groundswell of support — as well as a huge pool of capital held in private hands. We’re leading the charge in Canada and welcome you aboard!  Register now at SeedUps.ca

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. 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.

 

 

 

SeedUps Canada Launches “Be the Dragon” Investor Tour

There’s been much press about the new capital raising rules for Canada’s early stage companies.  As Canada’s first on-line platform to facilitate a private company investment from an “Ordinary Investor“, we’ve waited a long time to see these new rules come into effect. Today, companies looking to raise growth capital can reach out to a broader audience by presenting their deals on-line and attracting investment from Canadians that, until now, didn’t have access to private company investment opportunities.

Don McDonald, CEO Waverley

So now, we’re hitting the road on our “Be the Dragon Tour” to introduce this next generation of private capital investing to investors, both old and new.  Don McDonald, CEO of Waverley, the EMD that handles securities related activities on SeedUps states, “Investors want to learn more about this next generation of investing. Angels and early stage funds are curious about using SeedUps to fill out financing rounds for their portfolio companies and first time investors want answers about the risks and rewards of investing in private companies. This road show will help answer those questions”.

The tour launches in Vancouver on February 11th with stops in Calgary on the 17th and Toronto on March 2nd. The Toronto stop corresponds with #CCS2016, the 2nd Annual Canadian Crowdfunding Summit where SeedUps is a Diamond Sponsor. Participants at the “Be the Dragon” tour events will learn how on-line platforms are transforming the private capital markets, hear from companies raising capital and enjoy networking with investors from all walks of life.

For more information about the tour, go to our event page here. There are limited spots available, so register on-line now.

A special thanks goes out to our Tour Partners.

Tour Partners

This communication is for information purposes only and should notbe 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. 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.

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!

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.