Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Equity Crowdfunder Snowball Effect Gets FMA Green Light

31 July 2014

Equity Crowdfunder Snowball Effect Gets FMA Green Light

Snowball Effect was this morning granted New Zealand’s first equity crowdfunding licence by the Financial Markets Authority and is arranging a launch date for the week beginning 11 August.

Snowball Effect co-founder Simeon Burnett says the company would initially present investors with the opportunity to take shareholding stakes in leading craft brewery Renaissance Brewing (see attached summary and Renaissance Flyer).

Renaissance Brewing is seeking $600,000-$700,000 in new funding to expand its Marlborough operations and increase its marketing presence as it pursues its global growth ambitions. It is offering 300,000-350,000 shares (minimum purchase 250 shares) at $2, valuing the company at $5m and representing 12.28% equity if fully subscribed. The initial offer period is for 30 days.

Burnett says more than 200 companies have contacted the online platform about raising capital and the team is actively working with 14 businesses to bring them to market in the coming months.

“Equity crowdfunding represents a paradigm shift in the way SMEs access funding for growth,” says Burnett. “And it also changes the market for investors by broadening and simplifying investment opportunities in New Zealand.”

“SMEs have always struggled for capital but investors, particularly the average investor, have also had limited choice,” he adds. “Snowball Effect will open up this high-growth sector in New Zealand to everyday investors – and they can take small or large stakes without paying brokerage fees.

“The pool of people who participate in New Zealand’s capital markets is suddenly going to get a lot bigger and that’s very exciting.”

“It is however important that investors consider the risks of each investment opportunity carefully before committing. While these high growth companies may provide a potentially exciting investment opportunity, they typically have higher failure rates than more mature businesses”.

Snowball Effect’s Head of Platform and Investor Growth Josh Daniell said the licencing process was appropriately rigorous, and he is pleased to have demonstrated Snowball’s ability to meet the requirements.

Equity crowdfunding public offers would usher in a new era, Daniell says, and, over time, accelerate growth across the important SME sector.

International research into equity crowdfunding, he says, shows that participating companies are boosting revenue, hiring more employees and attracting interest from institutional investors after successful offers.

Click here for further information.

The Financial Markets Conduct Act 2013 and corresponding Regulations provide a new channel for investors. Through licensed equity crowdfunding platforms, each Kiwi company can raise up to $2 million in any 12 month period by offering shares to the general New Zealand public. This enables companies to raise funds from their customers, users, supporters, as well as the wider public. Investors are free to invest any amount up to the $2 million limit per year in any company raising funds through a licensed platform.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Oil: 2014 New Zealand Petroleum Summit

Simon Bridges: Our abundance of energy and minerals resources provides us with unique opportunities to build the New Zealand economy.

Over the past three years the Government has made significant changes to how the sector is regulated. More>>

ALSO:

Scoop Business: NZ Dollar Catches Breath After "Goldilocks" Slump

The New Zealand dollar edged up following its dramatic slump yesterday after the Reserve Bank confirmed speculation it intervened in the currency market last month and PM John Key suggested a “Goldilocks” level far lower than at present. More>>

ALSO:

Biosecurity: Kiwifruit Claim To Hold Officials Accountable For Psa

Kiwifruit growers have joined forces to hold Biosecurity NZ accountable in the courts for its negligence in allowing 2010’s Psa outbreak that devastated New Zealand’s kiwifruit industry and exports. Foundation claimants representing well ... More>>

ALSO:

Poison: Anglers Advised Not To Eat Trout In 1080 Areas

With the fishing season opening in just a few days (1 October 2014), anglers are being warned by the Department of Conservation(DOC) not to eat trout from pristine backcountry waters and their downstream catchments, where the department is conducting 1080 poisoning operations. More>>.

ALSO:

Quotas: MPI Swoop On Suspected Fraudulent Fishing Activity

Ministry for Primary Industries (MPI) compliance officers swooped on a Hawkes Bay fishing enterprise today to secure evidence in an investigation into suspected fraudulent activity... “The investigation involves activity throughout the commercial supply chain – catching, landing, processing and exporting.” More>>

ALSO:

Scoop Business: Fonterra Slashes 2015 Milk Payout, Earnings Tumble 76%

Fonterra Cooperative Group cut its forecast 2015 milk price payout by about 12 percent, citing weaker global dairy prices and said there is a risk of further declines given strong global milk production. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news