Equity crowdfunding’s strong start
A strong start for equity crowdfunding platforms reflects a genuine appetite to support inspirational NZ businesses. It’s important that these companies get more than just support in the form of capital but also with value and market growth strategies.
Fifteen young firms have raised a total of $8.7 million through three equity crowdfunding platforms since the low-strings fund-raising mechanism got the green light from regulators last year. The sum may be small compared to the $55m that well-heeled “angel investors” pumped into high-growth businesses last year and to the $4.7b bigger businesses raised through the NZX stock exchange in 2014.
It looks even tinier when compared with the current value of bank loans to businesses, which stood at $80b in April, according to the Reserve Bank.
But Chapman Tripp corporate lawyer Bradley Kidd says the start is encouraging.
More platforms have been set up than he expected to support equity crowdfunding and there have been some “really good offers”, he says. “I’d say it has gone a bit better than I’d of expected.”