Founder Series: Luke Fay of VentureCrowd

Crowdfund Vibe sat down with Luke Fay, CEO of Venture Crowd, to discuss the rise of crowdfunding in Australia. 

 

What was the motivation behind starting VentureCrowd?

VentureCrowd is democratising and scaling access to alternative finance. We are an alternative asset equity crowdfunding platform that provides investors with access to alternative investments, as well as entrepreneurs and property developers with access to alternative finance. All parties benefit from alignment, transparency and diversification.

The alternative asset universe has grown substantially over the past 10 years and can offer portfolio benefits such as uncorrelated returns, downside protection and improved risk/return profile. However, until VentureCrowd, direct investments in a diversified portfolio of alternative assets have been unviable to all but institutional investors or ultra high net worth investors with a family office due to large barriers to entry like ticket size, deal complexity and ongoing administration. Through fractional ownership, we offer our wholesale investors the ability to make direct investments into externally validated and curated alternative investments via an integrated platform. At the same time we provide high growth potential companies and curated property developers with access to funding that has been unavailable due to conservative risk appetites and capacity constraints from traditional sources such as banks and investment banks.

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Will Smoking Joe’s Horror Budget stifle or stimulate crowdfunding in Australia?

By Crowdfund Vibe Editor

The Australian Government has just handed down a tough, ideologically-driven budget that axes many government programmes, reduces benefits and abolishes dozens of government agencies.

Amongst a staggering range of headline cuts it has slashed funding for health and education, cut funding for film and the arts, and is proposing a six month waiting period for unemployment benefits for those under 30. The tenor of the government’s budget is similar to that of the 2008 Budget of the UK Conservative-Liberal Coalition albeit without the underlying Global Economic crisis that drove financial austerity there. Political opponents have attacked it as one that looks after the big end of town at the expense of the young, the aged, the unemployed and women. Commentators say it will undermine core values and the social fabric of the country.

A number of the 2014 Budget announcements will have an impact on crowdfunding in Australia.

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Is equity crowdfunding preventing startups from raising more capital?

By Clive Fernandes
Originally posted on the Crowdfunding NZ website

CrowdFund Capital Advisors recently released a report which is an interesting read on deal-flow as a result of Equity Crowdfunding. What really got my attention in this report were the following stats.

Within three months of a crowdfunding campaign:

– 28 percent of the companies had closed an angel investor or venture capital round.
– An additional 43 percent were in discussions with institutional investors.

This finding refutes the assumption that Equity Crowdfunding dissuades follow up investment, which could be one of the major negative perceptions that entrepreneurs and startup companies would have had with Equity Crowdfunding. The theory is that a potential Venture Capital firm would be put off from investing in an Equity Crowdfunded startup because of the thousands of existing shareholders it already has. The CCA report has shown this to be untrue and in my opinion the reasons are as follows.

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