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Company building online through crowdfunding


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Crowd Valley co-founder, Paul Higgins' presentation at Startup Camp Berlin, March 16th 2013

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Company building online through crowdfunding

  1. 1. Company building online through crowdfunding! Paul Higgins Co-founder, Crowd Valley March 16, 2013 Startup Camp Berlin
  2. 2. @paulhigginz @crowdvalley #scb13Overview!•  Grow VC Group – the crowdsourced company•  Crowdfunding in connected ecosystems•  Where crowdfunding is going next
  3. 3. @paulhigginz @crowdvalley #scb13Background – Grow VC!•  Global marketplace for startup funding•  Founded 2009•  “Everyone Funding Startups” –  2012 - $35M raised –  5,000+ startups –  190+ countries –  Several raised rounds, first exits
  4. 4. @paulhigginz @crowdvalley #scb13Cintep (Australia): First $100,000 from equity crowdfunding!
  5. 5. @paulhigginz @crowdvalley #scb13Regulatory activities!•  US Delegation in Transatlantic Economic Forum•  Cooperation with Singapore Government Investment Company, UKTI, etc.•  Crowdfunding Regulatory Intermediary Association (CFIRA)•  Crowdfunding Professional Association (CFPA)•  National Crowdfunding Association (NLCFA)•  European Crowdfunding Network (ECN)•  Cooperation with Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA)
  6. 6. @paulhigginz @crowdvalley #scb13H.R. 3606: Jumpstart Our Business Startups (JOBS Act)! Title II •  Online Solicitation of Accredited Investors •  This part opens possibility market, sell and trade private securities in market places •  This part can have more important influence on later funding phases than the early phase crowdfunding Title III •  Crowdfunding with non-accredited investors
  7. 7. @paulhigginz @crowdvalley #scb13Effective Dates of the JOBS Act!Title  I  (Creaon  of  EGCs;  “IPO  on  ramp”)   Largely  effecve  on  enforcement.  Title  II  (Amendments  to  General  Solicitaon/ The  SEC  had  been  scheduled  to  propose  new  rules  by  Adversing)   4  July  but  did  not  do  so  unl  29  August.  Final  rules  not   likely  before  end  of  1st  quarter  2013.  Title  III  (Crowdfunding)   The  SEC  is  required  to  adopt  new  rules  by  31   December  but  most  expect  these  changes  to  be   implement  in  mid/late  2013  Title  IV  (Increasing  Reg  A  offerings  to  up  to  $50   Not  yet  effecve,  date  unclear.  million)  Title  V  (Increased  thresholds  for  registraon  with  SEC)   Largely  effecve  on  enforcement.  Title  VI  (Increased  thresholds  for  registraon  with  SEC   Largely  effecve  on  enforcement.  for  banks)  
  8. 8. @paulhigginz @crowdvalley #scb13Grow VC Group!•  Launched spin-off Crowd Valley in 2012 to provide crowdfunding infrastructure: –  Configurable platform –  Shared business networks –  Back Office financial services•  Spun out other companies providing various services to support new online funding marketplaces –  Grow Advisors –  ChangeLab23 –  Mutual Seed Fund•  Developed a portfolio through global incubation services –  5 portfolio companies to date
  9. 9. @paulhigginz @crowdvalley #scb13Finance and Infrastructure Investment Services Portfolio
  10. 10. @paulhigginz @crowdvalley #scb13Crowdsourcing a company!•  10,000 people expressed an interest in getting involved with Grow VC•  Global network of 100+ associates•  Culture of openness, accountability, honesty•  Rewards proportional to commitment•  No recruiters•  No interviews•  No external funding
  11. 11. @paulhigginz @crowdvalley #scb13Work and resource investments!
  12. 12. @paulhigginz @crowdvalley #scb13Crowd-sourced startup acceleration!
  13. 13. @paulhigginz @crowdvalley #scb13Crowdfunding in connected ecosystems!•  How crowdfunding works•  Opportunities in crowdfunding•  The importance of ecosystems•  Alternative asset types
  14. 14. @paulhigginz @crowdvalley #scb13Crowdfunding is…!
  15. 15. @paulhigginz @crowdvalley #scb13Crowdfunding platforms can provide…!•  Validation of an idea•  Relationships with new potential customers•  Matchmaking between investors and entrepreneurs•  Efficient access to capital•  Standardised documentation, e.g. Shareholder Purchase Agreements•  Access to talent
  16. 16. @paulhigginz @crowdvalley #scb13Investment crowdfunding works: the proof! Source:
  17. 17. @paulhigginz @crowdvalley #scb13Where crowdfunding is today! Source:
  18. 18. @paulhigginz @crowdvalley #scb13Crowdfunding must be part of existing ecosystems!•  Crowdfunding does not happen in a vacuum•  “Invest in Lines, not Dots” – venture capitalist, Mark Suster: Images from
  19. 19. @paulhigginz @crowdvalley #scb13Building an entrepreneurial ecosystem in your city!Funding platformsAngel networksInvestor pitch eventsGovernment programsAcceleratorsIncubatorsUniversities
  20. 20. @paulhigginz @crowdvalley #scb13Manage angel pitch events!
  21. 21. @paulhigginz @crowdvalley #scb13Measure progress with scorecards and evaluations!
  22. 22. @paulhigginz @crowdvalley #scb13A ’typical’ startup path!Funding platformsAngel networksInvestor pitch eventsGovernment programsAcceleratorsIncubatorsUniversities
  23. 23. @paulhigginz @crowdvalley #scb13Find your natural constituency! Source:
  24. 24. @paulhigginz @crowdvalley #scb13Crowdfunding is about more than just startups…!•  Expanding a mezzanine fund for Oil & Gas investments in Rio de Janeiro•  Reducing risk by ‘leading’ rounds alongside new angel investors in Moscow•  Doctors financing R&D for new medical device companies in Sydney•  Alumni supporting their university’s entrepreneurship in San Francisco•  Offering debt opportunities based on real estate in London•  Connecting traders of precious stones with professional investors in New York
  25. 25. @paulhigginz @crowdvalley #scb13Where crowdfunding is going next…!•  Powerful and informative provider of data•  Efficient marketplaces in diverse sectors•  Integration with the rest of the ecosystem –  Universities –  Incubators –  Angel investors –  VCs –  Institutional funds•  Co-investment models –  Active –  Passive
  26. 26. Company building online through crowdfunding! Paul Higgins @paulhigginz @crowdvalley