Crowd-Sourced Funding Company Setup

 CSF Public Company Setup

Are you looking to convert your private company into a company that can legally raise funds from the general public through a crowd funding arrangement? Are you looking to setup a public company that can legally crowd fund for a new venture? If your answer to any of the above questions is a yes, then look no further.

Our team can assist you in either converting from a private company to a public company, or in setting up a newly unlisted crowd funding public company for your new venture.

Once the entity has been setup, you only need to list your venture on one of the many crowd-funding websites which are also known as Crowd Funding Intermediaries.

As accountants, we can not only provide the setup of your new venture, but as ASIC agents as well, we can also add and make changes to the company whenever the registry needs to be amended.

A crowd-funded public company can source funds from a vast number of private equity investors in order to invest in a particular venture. The venture will be well defined with the help of a prospectus.

The CSF Act received royal assent on the 28th of March 2017 and came into effect from the 29th of September 2017.

The new company, being a public company, will require a separate application to be able to be exempt from the corporate governance requirements that apply to all other categories of public companies. As accountants and ASIC agents, we are able to organise this part of the process for the new company formation.

The RG261: Crowd-Sourced Funding: Guide for Public Companies explains the regulatory environment of the CSF companies. The regulatory guide also explains how an offer of shares and acceptance can be carried out. We can assist you in the process of offering equity instruments for your CSF Company. However, there are also options where you could organise this through the CSF intermediary instead of us. Please note that our services are limited to the setup of the CSF Company and our fees and the scope of our work should be interpreted as limited to the setup of the CSF Company. Administration services would generally be provided by the intermediary.

Once a public company is formed under the new CSF guidelines, shares can be offered to the general public using an intermediary and this will be done through an offer document. We can provide the services of preparing the offer document if required, but this service can also be availed through the intermediary instead of us.

To be eligible, the assets and turnover of an existing company have to be below $25 million. Eligible companies will not be able to offer shares for more than $5 million in any 12 month period.

New companies or converted public companies qualify for certain specific reporting, compliance and audit exemptions for an initial period of 5 years.

The investors are protected and the CSF companies have obligations placed on them that are inclusive of but not limited to and apply to any and every CSF offer through any intermediary.

There are obligations and investor protections that apply to CSF offers, together with corporate governance concessions for companies undertaking CSF offers, including but not limited to the following:

  • An investor cap of $10,000 per annum per company for retail investors; meaning that once an investor invests a maximum of $10,000 in the CSF shares, there can be no more investment made by the same investor in the same CSF for at least another year
  • The provision of a CSF offer document containing minimum information and a prescribed risk warning. We as accountants can help to prepare the offer document containing perceived and implied risks of the investment, along with the possible outcomes. This will be prepared from information collated from discussions with you as the CEO of the CSF Company
  • A five-day cooling-off period: This period applies to all investments in the CSF by any investor. An investor can change their mind about the investment and will be entitled to a full refund of monies invested. This service would ideally be provided by the CSF intermediary

If have any questions pertaining to the setup of a crowd sourced funding company, feel free to contact our office or complete the below form and submit. One of us shall be in touch with you to discuss this opportunity.



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