Equity crowdfunding

Quick facts

Equity crowdfunding is a type of equity finance whereby people (‘the crowd’) invest in an early-stage unlisted company, in exchange for shares (equity) in that company. Individual investors thus become shareholders and stand to profit if the business does well – they might also lose some or all of their investment. Equity crowdfunding usually takes place over an online platform.

With a good crowdfunding campaign you can access potentially millions of people via one of the many crowdfunding sites.

If an Australian business opens a branch in UK, individual investors who put money into your business can offset some of the risk involved with investing in early-stage companies via two government tax relief schemes – the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS).

You might also want to consider debt crowdfunding – more commonly known as peer-to-peer-lending (P2P) – or other types of equity finance such as angel investors (business angels).

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