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Equity crowdfunding gathers more fame and partners

posted Dec 17, 2014, 1:36 AM by J Shaw   [ updated Dec 17, 2014, 1:37 AM ]
Australian equity-based crowdfunding platform VentureCrowd has announced the close of its second deal - a $50,000 raise towards fashion technology start-up Fame & Partners.

The news is another demonstration of the possibilities equity crowdfunding presents in Australia. 15 investors participated in the equity crowdfunding platform powered by Artesian Venture Partners. 

Crowdfunding - a process allowing for a large amount of individual investors to make small investments in companies - has taken off worldwide but is just finding its feet in Australia.

Investment group The Sydney Angels conducted due diligence and invested the majority of the round, while investors in the 'crowd’ used VentureCrowd to invest a further $50,000.

Fame & Partners makes dresses for special events on demand using a proprietary algorithm that determines what's trending, along with a vertically integrated supply chain. Shoppers are able to customise the dress to suit their taste and body shape.

The start-up's founder and chief executive Nyree Corby said she would will be using the funding to expand into the US market and invest further into the company's technology-enabled supply chain.

“We are a team that loves fashion and technology. The mish mash of the two means that millions of girls are inspiring other girls, every day, with style inspiration; we love that this sharing is shaping a culture of girls that want an individual look. This also happens to provide us with an incredibly rich data source to understand what they want.

“What’s unique about Fame & Partners, is combining this algorithmic insight into a real time, heavily optimised, tech-enabled and on demand supply chain; this allows us to respond to fashion trends fast and our customers to tweak dress features and colour, to make it theirs.

“As a team that admires innovation, it was only a natural fit for us to work with VentureCrowd as a funding source. We were thrilled on that basis to offer access to this deal to a wider range of people than a traditional funding route may have.”

http://www.crowdfundmadeeasy.com
Artesian Venture Partners chief operating officer Tim Heasley said the round provides one of the first Australian examples of how equity crowdfunding can work to provide startups with much–needed capital.

“Historically, investors have only received access to deals like this by being very close to the entrepreneur or founding team," he said.

“VentureCrowd provided exclusive access for smaller investment amounts in this deal to sophisticated investors. Crowdfunding creative works or prototypes through the likes of Kickstarter or Indiegogo are relatively common, but there are still a lot of people that don’t realise you can invest in a high growth startup and actually receive equity in the business.

“We’re thrilled that Australian entrepreneurs are realising the benefits of equity-based crowdfunding to help launch and grow their startups, and the public are able to receive equity in exciting new businesses.”

Investors can invest as little as $1,000 with no maximum on the VentureCrowd platform.

Meanwhile the federal government has opened discussion on developing a regulatory model for crowdsourced equity funding in Australia, releasing a discussion paper earlier this month.

The paper looks at different methods for creating a regulatory framework for a new funding model that would allow small investments from a large number of investors into a company.

Artesian's Mr Heasley said Australia was struggling to match more established crowdfunding markets.

"The Financial System Inquiry report is yet another voice of support behind introducing equity–based crowdfunding in Australia," Mr Heasley said. 

"It's correct in recognising that crowdfunding will incentivise innovation and competition in the financial system, while noting the measures needed to protect retail investors.

"Australia is falling behind the United States, New Zealand, Canada, the UK and others in being slow to adopt equity crowdfunding, which has the potential to more than double the amount of early-stage investment in Australian companies."

VentureCrowd went live in December 2013, armed with a funding model that seeks to partner with a broad range of key participants in the local market, including accelerators, incubators, universities, digital agencies and corporate venturing programs.

Posted from : http://www.businessspectator.com.au/news/2014/12/16/technology/equity-crowdfunding-gathers-more-fame-and-partners