Have you ever wished you could have invested in companies like Tesla, Facebook, Canva or Atlassian before they became public? Well unless you have a bucketload of cash or some sweet connections this has been out of reach for some time. A couple of Equity Crowdfunding platforms in Australia have been making some great progress to change this though!
The Problem: Australians need to hold a sophisticated investor certificate (attained from an accountant, stating the have income over $250k or Net assets of at least $2.5million), to be able to invest in companies before they go public.
The Government's reasoning behind this is that apparently if you earn lots of money you are more sophisticated and know how to assess risks involved with investing and don't need as much protection from them......
This type of regulation from the Government has kept great wealth building opportunities away from so many Australians due to and arbitrary test.
The Solution: Crowd-Sourced Funding platforms like Equitise & Birchal. That enable Australians to invest in early stage companies with small amounts of capital.
Their platform pools all the investors funds together to invest a lump sum into the business. In some cases you can invest for as little as $100. I really like the idea behind these platforms and how it opens up opportunities to the "little guy".
Opportunity is not without risks though. These are very early companies and there is no guarantee they will succeed. So the capital invested will be at risk. Recently Birchal raised capital for their own growth on their platform. Reaching their targets within minutes and setting lots of records along the way.
These platforms have done a great job at providing a simple solution for the "little guy" to get in almost at the ground floor and experience an early stage companies growth.
My Experience: To date I have actually made 6 seperate investments with a few on each platform and have found the process extremely easy to use. So far 1 investment has failed as the company got destroyed by COVID, meanwhile the other 5 are still growing strong!
Have you ever used these platforms, or something similar? What has your experience been? Also, should the "Sophisticated Investor" rule be changed? Let me know below.