Whilst there have been some great successes in the world of crowd funding, the pledge model works best for those seeking up to $30,000. This is wonderful to kick start an idea, but in many cases this isn’t enough to allow the dream to fully blossom. Pledge model crowd funding provides the starting rungs on the funding ladder, but there still seems to be a gap between that and “the big money” – a gap hoped to be filled by equity crowd funding. There is now one place where project creators can get a seamless transition all the way through both.
iPledg was originally conceived by founders who are active in the commercial world. They recognised that there was a gaping hole at the bottom of the funding ladder when it came to small businesses and start-ups accessing funding to get their ideas going. They recognised the answer lay in crowd funding, and given that broad scale equity crowd funding is not yet available in Australia, they set up iPledg on the pledge based model. This then allowed project creators potential access to early stage seed capital without the need to take on loans or without giving away equity at the very early and highly speculative stage of the business life cycle.
Whilst it is not yet possible in Australia to raise funds from dozens of unsophisticated, retail, or “mum and dad” investors, equity crowd funding does exist and actually has existed in Australia in one form, longer than anywhere else in the world. The Australian Small Scale Offering Board (or ASSOB) has operated a cutting edge equity crowd funding platform for 8 years, having successfully raised over $137mil in that time. Whilst the laws are fairly stringent around how funds can be raised in this way, it does operate with sufficient bandwidth to allow a business to go from genesis to serious funding and get well advanced in the business lifecycle. ASSOB can take businesses from where pledge model crowd funding traditionally leaves off, and help them raise up to $5mil capital per year, as well as preparing the founders for IPO, both financially, as well as the disciplines and mindset.
So far, there has been no singular pathway straddling both pledge model crowd funding right through equity crowd funding and through to IPO. That is, until the founders of iPledg recently became recognised ASSOB sponsors, providing the market for the first time a single channel of capital raising from $1 right through to millions of dollars. Start-ups and small business can now do their pledge model crowd funding under the guidance of iPledg, and then go on to start equity crowd funding under the tutelage or the same people that were there from the start – surely a world first!
And even more exciting is the way in which an iPledg campaign, using pledge model crowd funding, can be used to raise the funding required to cover the cost of equity crowd funding. In effect, it is now possible to run a pledge model crowd funding campaign, giving away product, services, or anything to get people to pledge (perhaps even offering to do household chores if the founders had nothing else to give) to raise the funds to cover an ASSOB listing.
With the familiarity, trust and knowledge of the founders requirements, there is no longer the need start again when it comes to the more advanced process of capital raising through the issue of equity. The folks at iPledg simply switch hats and continue the founders on their journey, now using the ASSOB process of getting investor ready. The fundamentals remain the same throughout – a good story, told well, with a strong team, and delivered on a strategy on how to build crowd to whom to appeal, as well as the best avenues for approaching them to offer equity (as opposed to rewards as done in the early stages through pledge model funding).
With the founders of iPledg now having developed a strategic alliance with ASSOB, they are now accredited sponsors for the equity crowd funding process in Australia. The founders of iPledg are the only ones to have bridged the two worlds of pledge and equity crowd funding, and as such are able to take project creators by the hand and guide them through the process from raising their first dollar, to raising the millions they may require. A truly unique offering, and one that will deliver to start-ups and small business a seamless pathway of funding from commencement to larger commercial success.
** To find out more about how you can raise the capital you require through either pledge-model or equity crowd funding, send your enquiry to iPledg