Equity crowdfunding goes private with FundedHere in Singapore
By Digital News Asia March 5, 2015
- Targets investments from as low as S$5,000 per investor
- Pending approval from the Monetary Authority of Singapore
EQUITY crowdfunding platform FundedHere has been launched in Singapore to facilitate equity-based funding and venture debt for startups in the region from as low as S$5,000 (US$3,700) each, even as regulators in both Singapore and Malaysia look to facilitate the launch of such platforms.
The FundedHere launch took place less than a month after the Monetary Authority of Singapore released a consultation paper setting out proposals for equity crowdfunding (ECF), which it called ‘securities-based crowdfunding.’
Last August, Securities Commission Malaysia (SC) also published a consultation paper requesting feedback, and released initial guidelines in early February, about a week before the Monetary Authority of Singapore released its paper.
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The FundedHere platform is subject to legal approval from the Monetary Authority of Singapore, and is sponsored by Andy Lim, a Singaporean entrepreneur who founded financial services group MoneyWorld in 1991 and cofounded local private equity group Tembusu Partners in 2006.
Tembusu Partners, which claims to manage close to S$300 million (US$240 million), has invested in startups such as GNum Pte Ltd and REKA Health.
While crowdfunding and crowdsourcing have emerged in recent years as a multibillion-dollar fundraising phenomenon in the United States and Europe, many such sites in the region are reward- or donation-based, whereby a business or a non-profit gives some type of incentive to an ‘investor’ or donor, FundedHere said in a statement.
“The spirit of crowdfunding is to tap multi-levels of investment or lending in order to fund innovative startups which have unique technology or creative content, but are unlikely to receive traditional bank loans because they do not have financial assets or a business track record,” said Lim (pic).
“As a major wealth management centre with a well-recognised legal framework and a rising startup scene, Singapore is an exceptional springboard for crowdfunding projects in the region.
“FundedHere will build up an ecosystem for startups which will combine innovators, investors, mentors, talent and partners who can help bring the ideas or products to the global market,” he added.
FundedHere said it will initially focus on startups in Singapore and South-East Asia seeking angel or seed equity funding or venture debt before they mature and seek more traditional venture capital or private equity, leading either to a potential trade sale or buyout, or even an initial public listing (IPO).
The equity investment or loan quantum can be as low as S$5,000 each for a period of no more than 12 months.
FundedHere, as the crowdfunding platform which bridges the investor/ lender and the startup, will receive a success fee from the latter for funds or loans which have been raised.
It said it has already lined up a panel of experienced mentors and lead investors who can invest as well as nurture these startups. These include Elim Chew, founder and president of the 77th Street; Lim Soon Hock, founder and managing director of Plan-B; and Prof Wong Poh Kam, founder of NUS Enterprise.
Lead investors comprise business leaders including winner of the Ernst & Young Entrepreneur of The Year 2014 award Susan Chong, chief executive officer at Greenpac; Joseph Foo, founder and executive chairman of Jason Marine Group; and Patrick Liew, an entrepreneur and investor.
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