crowdonomic equity crowdfunding in malaysia
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CROWDONOMIC
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The information contained herein (the “information”) has been prepared by Crowdonomic Media Pte Ltd (CWD) for the private and confidential use of prospective investors and is not to be reproduced or distributed, other than in connection with sharing this information with the investor’s financial advisors or consultants. CWD makes no representation or warranty as to the accuracy or completeness of the Information contained herein and all prospective investors are encouraged to conduct their own independent due diligence review. Not an Offer to Purchase or Sell Securities. This overview is for informational purposes and is not an offer to sell or a solicitation of an offer to buy any securities and may not be relied upon in connection with the purchase or sale of any security. Interests in the company, if offered, will only be available to parties who are “accredited investors” and who are interested in investing in CWD on their own behalf. Any offering or solicitation will be made only to qualified prospective investors pursuant to a confidential offering memorandum, and the subscription documents, all of which should be read in their entirety. The Information contains certain estimates of current performance as well as “forward-looking” statements which are based on various sources of data and assumptions of CWD, either or both of which may prove to be incorrect. There can be no assurance that such estimates or “forward-looking” statements accurately reflect current status or will accurately predict future events or the investment’s actual performance. In addition, any projections and representations, written or oral, which do not conform to those contained in this document, must be disregarded, and their use is a viola-on of law. No representation or warranty can be given that the estimates, opinions or assumptions made herein will prove to be accurate.
Equity Crowdfunding in Malaysia
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Professional Team with >30+ years of financial / tech expertise
Senior Consultant
Asia Strategy Lead
MBA BA. Law
Senior Consultant
Interest rate Trader MBA Engineering
Reona ShimadaCo-founder & CEO
Nicola CastelnuovoCo-founder & CCO
S.E. Asia
Innovation
S. Korea
Finance
China
M&A
South Asia
Tech
Japan
Strategy
UKS.E. Asia India
Tech
W.EuropeNorth Asia
Finance Operations InnovationInvestment
Experience and expertise
Crowdfunding… Finance 2.0
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What it is: Crowdsourcing for venture capital
How it Works: Fundraising accelerated by the power of social media and harnessing the wisdom of the crowds
Fill standard offer templates
Publish Online
Advertise via social media
Access virtual investor community
Reach $ targetGrow your business
Smaller amounts of money from many people to reach higher targets
Crowdfunding (CF) variants
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Donation CF Feel Good; Fulfillment
Reward CF Perks
Equity CF Shares / Securities
Debt CF Interest Rate returns
ChinaEast Asia & PacficS.AsiaEurope & Central AsiaLatin AM / CRBNMENAAfrica
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CF almost x2 itself every year and in the developing world expected to reach U$96bn. Asia will dominate.
Source: “Crowdfunding’s Potential for the Developing World” Report; InfoDev, Finance and Private Sector Development Department Washington – World Bank
Low High
8896
46 (51%)50 (52%)
7 (8%) 8 (8%)
4 (5%) 5 (5%)
13 (15%) 13 (14%)
11 (12%) 11 (11%)
5 (6%) 5 (6%)2 (2%) 2 (3%)
Crowdfunding annual transaction value – Intermediate term
Billion; Singapore Dollars ~63 bn
A-Class Investors are joining the movement
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Dave McClure (500 Startups)
Alexis Ohanian (Reddit.com)
Jawed Karim (Youtube)
Dustin Moskovitz(Facebook)
Reid Hoffman(Linkedin)
Jeremy Stoppelman(Yelp)
It will be a Game Changer for both Start-ups and Investors
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Efficient outreach to multiple investors via internet
Startups
Low – mid digit FRsRecord millions
8 -12 weeksAverage online fundraise period
Centralized deal sourcing platform
Investors
Crowdsourced due diligence community
$1 to 5KBite-sized investments to
diversify investment portfolio
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Technology Consumer/Retail Real Estate Fund
• MedTech robotics firm in Israel
• Raised S$4.2 M on OurCrowd
• IPO’d receiving S$46.2 M in net proceeds
• F&B Chain in UK
• Raised S$4.3M on CrowdCube
• Pool of 749 investors – accredited and retail
• Crowdfunding for a hotel in Palm Springs
• Raised S$1.9M on RealtyMogul
• Pool of 85 accredited investors
• Prolific early-stage venture fund
• Crowdfunding $100M fund with SeedInvest
Target Issuers: Proven and Emerging CF verticals
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Business Survival Rate
Follow-on Investment Rate
Exit Multiple for Crowd Investors
86% 71% x10+
*1 *2 *3
*1: 86% of all sampled Equity Crowdfunded businesses still operational on ASSOB since 2005 vs 59 % of companies still in business 3 year after establishment according to US Bureau labor of statistics*2: % of sampled Equity Crowdfunded businesses by Crowdfund Capital Advisors who have already secured follow on investments (28%) or were in discussions (43%)*3: Rewalk estimate: Rewalk raised $1.3 mn via ECF platform in 2013. IPO valuation was $191M in September ’14. At its maximum, its market valuation was $428 mn
Source: Various; Crowdonomic Team analysis
Crowdfunding – Robust performance track record
No reported cases of Fraud
Shareholders can be bundled up into a
vehicle
Investors are also chosen; Use lead investors to
inform market
You can control the level of information disclosure
“I’ll be stuck with managing Thousands of Shareholders (and
forced to IPO)!” “High Risk of Fraud”
“Competitors will steal all of my information”
The Market will be over-flooded with NVA Capital creating a
bubble
Many concerns and challenges are being addressed as the industry evolves
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All major markets in Asia are now at various stages of implementing CF targeted legislationCountries in Asia debating Equity CF
regulatory frameworks New Zealand Live Apr. 2014 – Equity / Debt CF
Malaysia Target Q2/Q3 2015 – Equity CF
Japan Target mid-2015 – Equity CF
India Proposal review – PCP* ended
Australia Proposal review – CAMAC
Singapore Under review - TBD
China Under review - TBD
Hong Kong N/A
Thailand SEC Public Consultation Paper released in December 2014
Source: Crowdonomic Analysis; Competitive Intelligence; Literature search
* PCP: Public Consultation Process
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ECF Regulatory Framework – Malaysia Highlights*
(*) Note: Contents in this page are based on SC ECF Public Response Paper and they are still pending parliament final approval. Source: http://www.sc.com.my/wp-content/uploads/eng/html/consultation/140925_PublicResponse_2.pdf
Who: All Malaysia incorporated private companies + SC Registered Micro Funds
How much: Private Companies (RM 3 mn / RM 5 mn) + VC Funds (uncapped)
Share Types: Common Shares (preferred and ordinary); single type per Offering
Fundraise Type: All-or-Nothing (Oversubscription is allowed)
Offer Types: Primary (new share sale); Secondary (existing shares; 2 wks per 6 months)
Advertisements: May advertise to the public but ONLY via the ECF platform
Investors: Retail (RM 50k) + Angel (500k)+ Sophisticated Investors (Uncapped)
Disclosures: <300k (not mandatory); 300 – 500k (case by case); >500k (Audited)
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Malaysia ECF Business Model: Value Add Market Place
Source: Crowdonomic Team analysis
Micro VC fund
(managed by CWD)
Crowdsource for LPs
Invest and Trade
Trade Shares
Micro funds
Syndications
Secondary Sales of Shares
Direct Investments
Retail Investors
Professional Investors
Institutional Investors
Issuers - Primary Sales
Fundraising by Funds
Crowdonomic Marketplace
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Contact Us
www.crowdonomic.com
@crowdonomic
www.facebook.com/crowdonomic
Leo Shimada (Co-Founder / CEO) – leo.shimada@crowdonomic.com / (65)82236018
Nicola Castelnuovo (Co-Founder / CCO)– nicola.castelnuovo@crowdonomic.com / (65)90056541
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