The Corporations Amendment (Crowd-sourced Funding) Bill 2016 has been passed to introduce a new funding avenue for Australian start-ups and an opportunity for retail investors to access equity in emerging companies.
This opens new doors for small businesses and startups, who might otherwise struggle to obtain affordable finance.
Unlisted public companies with less than $25 million in assets and annual turnover can engage in crowd sourced equity funding to raise capital, where eligible companies may raise up to $5 million in any 12-month period through licensed crowdfunding platforms.
This follows on from the recent announcement that Silicon Valley’s globally renowned accelerator program 500 Startups will establish its Australian headquarters in Victoria after securing a funding grant from LaunchVic – the Andrews Labor Government’s $60 million startup fund.
Startups from within Australia and across the Asia Pacific can now register their interest in the 500 Melbourne program here.
All LaunchVic grants in funding Round 2 were matched with cash and in-kind support that will result in a total investment of $11.6 million for Victoria’s startup sector.
More information on the grant recipients can be found here.
Allens have produced a useful overview on the new laws which can be read here.
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