Crowdfunding FAQs
1. What is crowdfunding?
Crowdfunding allows people, groups and companies to raise funds for a diverse range of projects, good causes and businesses from large groups of people all providing relatively small amounts of money.
2. What is equity crowdfunding?
Equity crowdfunding allows a company to sell shares to the public to support and grow the company’s business. Equity crowdfunding provides an opportunity for the public to invest in interesting companies when they might not otherwise have a chance- these opportunities are sometimes limited to private investors like angel groups and venture capitalists.
3.What does Collinson Crowdfunding do?
Collinson Crowdfunding provides equity crowdfunding services, which means that we provide an on-line platform that helps to match companies seeking to raise share capital with investors. We also carry out limited checks on companies that make offers using our service- see our Disclosure Statement for more detailed information on our service.
4.How is equity crowdfunding regulated in New Zealand?
To offer our service we have to obtain and maintain a licence issued by the Financial Markets Authority. That includes meeting minimum standards in relation to the skills & experience of our personal, and in relation to for our systems, operations, finances and governance. We are registered on the Financial Service Providers Register (FSPR) and you can view our details here.
5.What are the risks associated with equity crowdfunding?
Some risks associated with using our services and investing in companies that use our service are described in the risk warning you receive. See also our disclosure statement and client agreement. Investing in shares carries additional risks, some of which may be described by the company offering the shares.
6.As an investor, is there a minimum and maximum amount that I can invest?
The minimum and maximum amounts that you may invest will vary from company to company and are set out in the offer pages for each company .
7.Can trusts and companies invest in an offer?
Trust and companies can invest in offers made on our platform. Some extra steps are required to allow trusts and companies to invest, including because our anti-money laundering obligations are greater for trusts and companies. If you are a trust or company that wishes to invest please contact us. We set minimum investment amounts for trusts and companies because of the extra effort required to support trust and company investors.
8.How do I invest in an offer?
Once you have decided to invest in an offer, follow the website prompts to the payment page by filling in the requested information as you go. Please contact us directly if you have any concerns or difficulties making your investment using our service.
9.How is my investment held?
Investor funds are paid directly into our bank trust account via a secure externally-managedpayment portal operated by Payment Express. Payment transactions are subject to Payment Express’ own policies and procedures, including those for account-2-account payments.
Once an investment is made it cannot be withdrawn or changed. However, you may make additional investments for the duration of an offer.
10.What happens to my investment if an offer is not successful?
If an offer is unsuccessful, investment funds will be returned to you less any payment provider fees you paid and any interest earned (see below for details of fees).
11.Can I receive rewards?
Some offers may include rewards for investors. Once the offer is successful, the company will get in touch with its new investors regarding any rewards. We have no involvement in this process.
12. What fees do I pay
There is no charge for registering as a member of Collinson Crowdfunding. We charge the companies making offers a fee. Your bank or other payment providers you use may charge you a fee for transferring investment funds to us. You’ll need to check with that provider what fees they charge.
Any interest earned on investor funds held in our trust account will be retained by us an administration fee.
Any changes to our fee structure will be advised in advance and be will published on our website.
Full details may be found in our Investor Client Agreement.
Feel free to ask us any other questions that you may have at info@ccfl.co.nz
SIMPLIFYING INVESTMENTS FROM WHOLESALE INVESTORS
Collinson Crowdfunding makes it easier for “wholesale” investors to invest in an offer. Investors may be “wholesale” because of their relationship with the company making the offer (e.g. relatives) or because of characteristics of the investors (e.g. an experienced investor, a large investment, investor has high net worth).
The key benefit for your company of using Collinson Crowdfunding’s licensed equity crowdfunding platform is that the company can make a public offer without the prescriptive disclosure and other regulatory obligations that usually apply to a public offer. However, if the offer is made under our license you can only raise up to $2m per company each 12 months and there are some restrictions on share classes (e.g. convertible shares, some preference shares) and use of funds (e.g. funds raised cannot usually be passed on to a third party). We provide support for offers to some types of wholesale investors, who are not subject to those limitations. Some extra process and forms are required to allow wholesale investors to invest – we help you with that. Please contact us for more information.
