A SAFE – Simple Agreement for Future Equity – was created by Y-Combinator in Silicon Valley as a way for companies to raise a small amount of capital as a first step towards raising a larger venture capital round. While it makes sense if a VC round is assured, there may be a better way using a “SAFETY”. Continue reading
Category Archives: posts
Bitcoin and Blockchain Demystified
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Bitcoin is all the rage these days. And, so is Blockchain. What’s it all about? Continue reading
Tax Proposals will Shrink Capital Available for Startups
Business begets business. Successful entrepreneurs invest profits from their business in new ventures. These “angel investors”, and the critical role they play in the innovation landscape, are not well understood by policy makers. Instead of amplifying their nascent contributions, the new tax proposals may keep them at bay. This is because the proposals will make it unattractive for angels to use business income to invest in new startup ventures. Continue reading
Small Business Tax Proposals
The Liberal Government is proposing several changes to the small business tax regime in Canada. Their stated reason is “tax fairness” – to keep the rich from using corporations to shelter tax that they would otherwise pay at a personal level. Unfortunately, unless done properly, this will make it tougher for entrepreneurs to raise capital and less attractive for investors – not good for the same Government’s “Innovation Agenda”. Continue reading
More Red Tape for Entrepreneur and Angels – Accredited Investor rules
Effective May 5,2015 Canadian Securities Regulators have added another burden on companies raising capital from Accredited (i.e. Angel) Investors. Instead of just relying on the honesty of the investor, companies must “take steps” to ensure that the investor is not lying. Continue reading
Crowdfunding Updates
This blog contains the latest developments in Equity Crowdfunding.
Better Terms = Better Outcomes
Many exits happen at much lower than expected values. Even a three or four fold increase in company valuation may not produce positive returns for the early risk-taking investors. Angel investors and first-round investors are taking it on the chin all too often. Here’s how to stop it. Continue reading
BCSC Considering Crowdfunding Exemption
Just a day after I wrote about Crowdfunding becoming the new VSE, the BC Securities Commission issued a notice requesting comment on the idea of a new crowdfunding exemption that would allow companies to raise a small amount of capital (max $150K) from investors in small amounts (max $1500). Continue reading
Crowdfunding = Going Public
The more I think about equity crowdfunding the more I believe that this is going to be the new VSE (Vancouver Stock Exchange). It’s almost inevitable when you stop and think about it. Doesn’t “crowd” mean “public”? So why is crowdfunding any different? Continue reading
Equity Crowdfunding – Doing it Right (for discussion)
Equity Crowfunding – the selling of shares in new ventures to the general public – can give entrepreneurs access to a vast resource of new capital. While this will stimulate the creation of more companies and jobs, not everyone thinks that this is a good idea. Securities regulators are worried about investors losing out due to fraud or flaky deals – not to mention the high risk associated even with the best deals. This article puts forward some suggestions – for discussion purposes – on how we can make it work – right here in Canada. Continue reading