EQUITY CROWDFUNDING
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Winning formulas to a great equity crowdfunding campaign
October 30th, 2014
crowdonomic.vc @Crowdonomic Facebook.com/C
rowdonomic
Introduction: Crowdonomic Media
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Taking Control of Your FR Destiny
• Mission: Empower Innovators in Asia
using the power of Financial 2.0
• Fin-tech, Full portfolio
• Asia-play
Largest CF in SE. Asia
• Larger than other SEA CFPs
• (SG) ~<10x than int’l CFPs
Innovation is our DNA
• World’s first Telecom-backed CF
platform (Crowdtivate)
• World’s first global CF platform for
projects positively impacting the earth
(WWF/ EarthHour)
Active Regulatory Partner
• Engaging multiple Regulators / Gov’t
agencies across Asia
Agenda
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It is a great time to be an Entrepreneur in Malaysia
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Malaysia is one of the first countries
to modernize Fundraising Activities
A New Regulatory Framework for
Equity Crowdfunding is on its way
Why is this important for you? …because efficient
access to Capital is #1 obstacle to growth
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of Micro-SMEs (Start-ups+SMEs) in Asia say access
to finance is their largest obstacle to growth
Source: IFC/ Worldbank Enterprise Survey 2006-10; World Bank GDP 2008 - 2010
40%#1
Crowdfunding… This is Finance 2.0
What it is: Crowdsourcing for
venture capital
How it Works: Fundraising accelerated by the power of social
media and harnessing the wisdom of the crowds
Fill standard
offer templates
Publish Online
Advertise via
social media
Access virtual
investor community
Reach $ targetGrow your
business
Smaller amounts of money from
many people to reach higher targets
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Modernization of Fundraising Regulations and
Activities
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No General Solicitation
Prospectus Exemptions: Limitations
on Advertisement; Investor Types; #
Public Offerings = Costly
Disclosures / Prospectuses
Fundraising: Extremely Difficult and
Restricted Activity
Advertisement Flexibilities
Full use of Web / Social Tools
Template and Standardized FR
Process for Efficiencies
Fundraising: Still Really Difficult Activity
but Equipped with Modernized Tools
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ECF Regulatory Framework – Highlights*
(*) Note: Contents in this page are based on SC ECF Public Response Paper and they are still pending parliament final
approval. Source: http://www.sc.com.my/wp-content/uploads/eng/html/consultation/140925_PublicResponse_2.pdf
DISCLAIMER: This does not constitute any legal or financial advice
Who: All Malaysia incorporated private companies + SC Registered Micro Funds
How much: Private Companies (RM 3 mn / RM 5 mn) + Micro Funds (uncapped)
Offer: Primary (new share sale); Secondary (existing shares; 2 wks per 6 months)
Advertisements: May advertise to the public but ONLY via the ECF platform
Investors: Retail (RM 50k) + Angel (500k)+ Sophisticated Investors (Uncapped)
Agenda
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Publish Offer Page
Access virtual
investor community
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Acceleration Validation Traction
#1: Use the full power of web, social media and
technology to accelerate the Fundraising process
#2: it is a Game Changer for both Start-ups and
Investors
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Efficient outreach to
multiple investors via internet
Startups
Low – mid digit FRsRecord millions
8 -12 weeksAverage online fundraise period
Centralized deal
sourcing platform
Investors
Crowdsourced due
diligence community
$1 to 5KBite-sized investments to
diversify investment portfolio
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Technology Consumer/Retail Real Estate Fund
• MedTech
robotics firm
• Raised S$4.2 M
on OurCrowd
• IPO’d receiving
S$46.2 M in net
proceeds
• F&B Chain in
UK
• Raised S$4.3M
on CrowdCube
• Pool of 749
investors –
accredited and
retail
• Crowdfunding
for a hotel in
Palm Springs
• Raised S$1.9M
on RealtyMogul
• Pool of 85
accredited
investors
• Prolific early-
stage venture
fund
• Crowdfunding
$100M fund
with SeedInvest
#4: Emerging Crowdfunding Verticals
No reported cases of
Fraud
Shareholders can be
bundled up into a
vehicle
Investors are also chosen;
Use lead investors to
inform market
You can control the level of
information disclosure
“I’ll be stuck with managing
Thousands of Shareholders (and
forced to IPO)!”“High Risk of Fraud”
“Competitors will steal all of my
information”
The Market will be over-flooded
with NVA Capital creating a
bubble
We are tackling Common Equity Crowdfunding
Concerns
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Agenda
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Equity CF Offer Page – A dedicated fundraising page
Content: Building Up Credibility on Your Offer page
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Board & Team
with relevant
credentials
Endorsement from
fans and industry
experts
Strategic
Partnerships
IP
Attractive
valuation and
desirable exit
Demonstrate
ability to achieve
milestones
Additional Items:
• Business Plan
• Investor Pitch
Deck
• P&L
• Cash Flow
• Balance Sheet
• Sell the vision / dream
• Ground the business plan
• Nail the delivery
• Form as important as Content
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Visual: Supporting Your Offer Page with Video
Do
• Be vague
• Be boring
• Be awkward
• Show only the product
Don’t
Team: Assembling a Capable Fundraising Team
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Charismatic Front
Person
Graphic Design/
Video Person
Social Media
Person
Document and
numbers person
• Media
spokesperson
• Investor
Meetings
• Brand
Ambassador
• Social media
updates
• Site updates
• Answering
enquiries
• Putting
together the
offer page
• Putting
together the
financial
documents
• Designing
visuals
• Creating video
and other
creative assets
Are you Ready?
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YOU’RE DOING IT WRONG
Create Momentum: Dance Floor Theory
How can you get a crowded dance floor?
How can you get a crowded dance floor?
You need a proper execution plan to draw in early supporters.
Create Momentum: Dance Floor Theory
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Marketing and activation support a Crowdfunding
Platform will provide
Expected
reach via
platformPlatform Social
Media Updates
Platform Blog
Platform
Newsletters
Membership
Access
Templates
Platform
Marketing
It’s a dual effort
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Extend your reach with your own execution plan
Expected
reach via
platform
Reach via own
initiatives
Public Relations
Personal Mail
Outs
Media Interviews
Blogger Outreach
Product Demos
Social MediaAwards
Competitions
Site Visit/ Factory
Tour
Awards
Competitions
Company Blog
Updates
Investor Meetings
Offline Events
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Campaign Execution: Best Practices
Prepare follow
up videos,
creative assets
and regular
campaign
updates
Be quick to
respond to queries
and comments
Show your
appreciation and
thank all your
investors
Contact press only
once you have
obtained some
funding to have a
newsworthy angle
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Recap
• Secret sauce… Social Media (Distribution) + Democratic Participation
• Difficult and Inefficient = > To: New efficient way to do a difficult thing
• Malaysia – a pioneer market, power to Start-ups
• Combine with Lead Investors + Conventional best practice
• Promote, Market and Execute…make full use of this New Freedom
www.crowdonomic.vc
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Who We Are
Senior
Consultant
Asia Strategy
LeadMBA BA. Law
Senior
Consultant
Interest rate
TraderMBA Engineering
Reona Shimada
Co-founder & CEO
Nicola Castelnuovo
Co-founder & CCO
S.E. Asia
Innovation
S. Korea
Finance
China
M&A
South Asia
Tech
Japan
Strategy
UKS.E. Asia India
Tech
W.EuropeNorth Asia
Finance Operations InnovationInvestment
Experience and expertise
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