Crowdfunding

for Beginners

How to Raise Money for Start-ups,

Early Stage Enterprises, Charities and Non-Profits

Published by Productive Publications

Our 32nd Year Publishing Books For the Digital Age

 

DETAILED Chapter contents

 

INTRODUCTION

Where Crowdfunding Fits into The Big Picture

Crowdfunding Takes Off!

What is Crowdfunding?

The Funding Gap for Small and Start-Up Businesses

Crowdfunding by "Micro-Angels" Could Fill the Gap

Love Money

Financial Angels

Dwindling Number of Accredited Angel Investors in the U.S.

The Canadian Angel Experience

The Reluctant Venture Capitalists

Bank Financing and Leasing

Initial Public Offering (IPO)

What Happens in Theory May Not Happen in Practice

Where Equity Crowdfunding Fits into the Big Picture

How this Book Will Help You

 

Chapter 1

Preparing Yourself for the Equity Crowdfunding Adventure

Setting Your Strategic Objectives

Are Your Strategic Objectives Realistic?

The Peril of Too Many Objectives

Figure Out How Much Money You Really Need

Use Cash Flow Projections to Calculate Your Needs

The Importance of Knowing What You Need

Observations on Start-up Capital Needs

Prepare Your Business Plan

The Structure of Your Plan

Economic Benefits:

Address the Concerns of Investors

Risks and Uncertainties

The Offering Memorandum (OM)

Prospectus Not Required in Crowdfunding

Establish Your Presence on the Internet: Set up Your Own Web Site

Register Your Domain Name

Create Your Own Web Site

Web Hosting

Web Design Software

Add Sizzle to Your Web Site: Prepare a Video

Editing Video Content

Streaming Video

Progressive Download

Who are the Major Players?

 

Chapter 2

Issues You May Encounter

When Raising Equity-based Crowdfunding

The "Hoops" You'll Have to Jump Through

The "Due Diligence" Process

Valuation

Expected Return on Investment

Non-Disclosure Agreements (NDAs)

Points Likely to Be Negotiated

Total Financing Required

How Much Money Has Already Been Invested?

Timing of the Investment

Dilution

Management and Other Fees

Control

Restrictive Covenants

Affirmative Covenants

The Investor's View of Management

The Term Sheet

Share Purchase Agreement

Investor Rights Agreement

Right of First Refusal and Co-Sale Agreement

No Shop Agreement

The Legal Agreement

Directorships

Directors' and Officers' (D&O) Liability

Cyber Liability Insurance and Third-Party Protection

A Smart Way to Create Your Legal Documents

Will All These "Hoops" Apply to Crowdfunding?

Comments About Negotiating with the Providers of Capital

 

Chapter 3

The U.S. Equity Model for Crowdfunding

Accredited Investors

Title II: The Removal of the Gag Has Enabled Crowdfunders to Solicit Accredited Investors

CircleUp

Funders Club

SeedInvest

Realty Mogul

Prodigy Network

Patch Of Land Real Estate Lending Platform

Title III: The Most Momentous Securities Exemption Since 1933

The Devil of Title III is in the Details

The Details and Comments About Title III are Voluminous

Title III to Allow Non-Accredited Investors to Participate in Crowdfunding

Caps on Amount of Funds Crowdfunders Can Invest

Mechanisms to Make Sure that Caps are Not Exceeded

Crowdfunded Offerings Have to be Channelled Through a Funding Portal or Broker/Dealer

Are Intermediaries Necessary in the First Place?

The Use of the Internet and Social Media in Title III Crowdfunding

Maximums Set On the Amount of Capital that Can be Raised

Investor Rescissions Could Nip Issuers in The Rear-End

Who Conducts Due Diligence for Equity Crowdfunders and Who Pays For It?

Small Business Failure Rates

Crowdfunding Investors Are at Risk

Franchisees Should be Considered as Candidates for Crowdfunding

The Compliance Costs Crowdfunding Rules Should Also Be Flexible Enough to Accommodate Other Types of Funding

Collateralization of Debt Offerings

Because of Delays, Individual States are Going it Alone

 

Chapter 4

Crowdfunding in Canada

A Decentralized System of Governance in Canada

The Provincial Securities Commissions

Canadian Securities Administrators (CSA)

The Canadian Securities Regulatory Authority

The Investment Industry Regulatory Organization of Canada (IIROC)

The Offering Memorandum (OM) Exemption Already Permits Limited Crowdfunding in Every Province Except Ontario

Saskatchewan is the First to Adopt an Equity Crowdfunding Exemption The Ontario Securities Commission (OSC)

Seeks Public Comment on Crowdfunding Proposals

Comments on the OSC's Crowdfunding Proposals

Accredited Investors in Canada

SeedsUp Canada

The Canada Revenue Agency (CRA) Makes its Position Known With Respect to Rewards-Based Crowdfunding

Canada's New Draconian Anti-Spam Laws Could be a Crowdfunding Killer

 

Chapter 5

Crowdfunding in the United Kingdom

The Regulatory Framework

The Brits Drop the Ball

Investment-Based Crowdfunding is Growing

CrowdCube

Seedr.com

Other Authorized Crowdfunding Firms

Loan-Based Crowdfunding in the U.K. is Growing Fast But Will Be Regulated

Examples of British Loan-Based Crowdfunding Portals

Crowdfunding in the U.K. is Already Providing Badly-Needed Capital for Start-ups and Small Businesses

The U.K. Investment Enterprise Scheme

 

Chapter 6

Crowdfunding Down Under

Australia

New Zealand

Chapter 7

The Crowdfunding Loan Model

What You Should Know About the Crowdfunding Loan Model

Specific Loans vs. Autolending

Attractiveness of Crowd-Based Lending is Dependent on Prevailing Interest Rates

Types of Loan-Based Crowdfunding

Factoring as a Method of Borrowing

Methods of Payment

Method of Financing

Advantages and Disadvantages

Invoice-Factoring Crowdfunding

Lending Club

Prosper

Zopa

Mosaic

 

Chapter 8

The Crowdfunding Rewards Model

The Basic Concept Behind the Rewards Model or Perks-Based Crowdfunding

Kickstarter

RocketHub

Pozible

A KickIn Crowd

Crowdfunder of the U.K.

 

Chapter 9

Raising Money for Charities & Non-profits

Charitable Giving is Not Motivated by Profit-Making and Generally Falls Outside of the Regulatory Net

Social Investments are Regarded Differently

Some Overlap With Perks-Based Crowdfunding

Indiegogo

Kiva

CauseVox

CrowdTilt

Other Charity Platforms

 

Chapter 10

The Future of Crowdfunding

Small Business is a Creator of Jobs

Is the Crowd Wise?

Excessive Paternalistic Concern About Protecting the Crowdfunding Investor

The Bureaucrats Just Don't Get It!

Crowdfunding is Based on Using Internet and Social Media to Communicate

Create a Single Crowdfunding Hub for Initial Offerings as Well as a Secondary Market Place

Think of Using Standardized CryptoShare Certificates in Conjunction With a Centralized Trading Hub

A Secondary Aftermarket is Desperately Needed

The Possibilities are Endless!

Much Ado About Nothing!

Tax Credits Could Boost Interest in Crowdfunding

Crowdfunding is Booming...in Certain Areas!

 

Crowdfunding for Beginners: How to Raise Money for Start-ups, Early Stage Enterprises, Charities and Non-Profits by: Learn2succeed.com Incorporated:  Softcover; 156 pages; ISBN: 978-1-55270-706-7  published in June 2014; Canadian: $24.95.  

 

 

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