Can I invest now?
- Absolutely, we currently conduct an online business introduction service, which operates pursuant to the ASIC Class Order 02/273 “Business Introduction or Matching Services”, using the exemptive relief of section 708 of the Corporations Act;
- The current section 708 exemption allows for 20 retail investors per capital raise in a twelve-month period;
- There is no limit or restrictions on the number of sophisticated or wholesale investors;
- This will change for retail investors with the new crowd-sourced equity funding (CSF) legislation;
- Please note that we (Enable Funding) do not currently hold an Australian Financial Services Licence (AFSL) to provide a crowd-funding service under the new CSF regime and are not subject to the gatekeeping obligations that apply to CSF intermediaries.
Is buying shares in Enable's profiled companies risky?
Enable Funding does not give financial advice of any kind.
We simply publish offers made by various companies. It is up to you to read the information provided by the company offering the shares, in particular the risks section of their offer document.
You should also seek independent advice from an Australian Financial Services Licensee who is qualified to provide such advice. You should also do your own due diligence about the industry, market opportunity and competitors.
The companies listed on the Enable platform are usually unlisted early stage companies and they generally fall into the high-risk category of investing due to:
- Illiquidity –Most of the businesses displayed on the Enable platform will not be traded in a secondary market. This means once you invest you will most likely have to hold your ownership in the business until either the business lists on the stock exchange or the business is purchased by another company which could take many years;
- Loss of Capital – Most early-stage businesses fail which results in investors losing all invested capital. You should not invest more money than you can afford to lose without altering your standard of living.
- Dividends –Early-stage businesses typically do not pay dividends as any profits made are re-invested back into the company to help it grow and develop. Return on capital usually occurs if the business lists on the stock exchange or the business is purchased by another company.
- Dilution – Dilution occurs when the business raises additional capital at a later date. By issuing new shares it will decrease the percentage ownership of all existing investors. Dilution may also occur as a result of the grant of options (or similar rights to acquire shares) to employees or other related parties to the business.
What fees do I pay?
Investors into companies listed on the Enable platform are charged no fees.
Is Enable Funding a stock exchange?
No, stock exchanges are able to show live buy and sell offers and are subject to high levels of compliance and regulation.
Enable Funding is a platform that provides the tools for companies and funders who have acknowledged the risks of investing in companies outside of regulated markets such as a stock exchange, to communicate more efficiently and manage what is needed for a successful transaction.
Tell me about the new CSF changes
Crowd-sourced funding (CSF) (also called equity crowdfunding or crowd-sourced funding of shares) is a new way for start-ups and small and medium-sized companies to raise money from the public to finance their business. Companies typically raise small amounts from a large number of investors. Each retail investor can invest up to $10,000 a year in a company and in exchange they’ll receive securities in the form of shares.
Eligible companies can raise up to $5 million a year using crowd-sourced funding but they must have less than $25 million in assets and annual revenue.
The new crowd-sourced funding (CSF) legislation enables capital raising to commence on 29 September 2017.
By law, eligible companies must use a crowd-sourced funding (CSF) platform, usually a website, to make their investment offer. The website is run by an intermediary that must have an Australian Financial Services Licence (AFSL) which authorises them to provide crowd-sourced funding services. We are in the process of applying for an AFSL to operate as an intermediary under the new CSF legislation. Once granted, this AFSL will allow us to conduct a capital raise under the new CSF rules and raise up to $5 million from investors (maximum $10,000 parcels for retail investors) for qualified companies;
We intend to continue to operate the current platform under Class Order 02/273 for the foreseeable future and also operate a CSF intermediary platform (once approval has been received from ASIC) in tandem.
How will things change for me with the new CSF legislation?
For the first time, Australia has a legislative framework that allows crowd-sourced equity funding (CSF). The Federal Government in 2017 introduced new laws that bring our equity crowdfunding market into line with US and UK developments.
Key provisions include:
- Wholesale investors (including sophisticated and wholesale investors) have no investment size restrictions;
- A retail investor limit of $10,000 per company (issuer), but an unlimited number of retail investors;
- An unconditional ‘cooling off’ period for retail investors to withdraw from a CSF offer within five business days of their application;
- A prohibition on the company and its related parties, and the CSF intermediary and its associates, providing retail investors with financial assistance to buy shares under CSF offers.
Can I easily sell shares I buy through Enable's platform?
Not generally. Unlike stock exchanges such as the ASX where there is significant liquidity, Enable is a much smaller platform where secondary sales (for section 708 raises only) occur relatively infrequently.
This means once you invest you will most likely have to hold your ownership in the business until either the business lists on the stock exchange or the business is purchased by another company which could take many years.
For further information about secondary sales of shares bought on the Enable platform, please contact firstname.lastname@example.org.
What is the process to get my business funded?
- Companies lodge an expression of interest (EOI), answering key questions that are a pre-cursor to being invited into the IMENCA process. Only a subset of EOIs are taken forward.
- Completing the IMENCA process, a rigorous and insightful experience, applying researched venture attributes to articulating, evaluating and optimising each offer’s business model. Only a subset of optimised models are taken forward.
- Preliminary pitching to the Enable Funding Investment Committee where again, only a subset of business opportunities are taken forward.
- Our team will undertake due diligence on your application, verifying details about your company, directors and offer information.
- Enable will assist with producing the Offer Document and other materials associated with being ready to list the offer on the Enable Funding Platform.
- All of the assets are loaded up to a profile page on the website, Enable Funding then begins a campaign to market the raise to your VIP database and its investor database and the funding begins.
Where do I start?
You can get started by filling out the expression of interest form, there are several sections to this process to complete.
What does Enable look for from businesses that want to list on the platform?
The investment team look for several things, including:
- Entities that are publicly unlisted companies or willing to become publicly unlisted companies;
- Companies looking to raise between $500,000-$5,000,000;
- Potentially high growth, scalable businesses;
- Businesses that have a working prototype of their product;
- Businesses that our screening process identify as having the highest chance of success in attracting investors.
How do I value my business?
Enable Funding work with what we believe to be a world-leading, independent third party pricing and valuation platform who have worked with over 30,000 unlisted companies globally.