Australian startups are turning to equity crowdfunding in increasing numbers, with a total of $27 million raised in FY22. This is the largest amount ever raised through equity crowdfunding in Australia, and marks a significant increase from the $19 million raised in FY21. The Food & Beverage and Farming & Agriculture sectors were both among the top 5 for funding volume in FY22, demonstrating the growing popularity of equity crowdfunding as a financing option for Australian startups.
About Equity Crowdfunding
In Australia, a company can raise up to $5M in Equity Crowdfunding via a licensed Equity Crowdfunding Intermediary with an online investment platform. Eligible retail investors are permitted to invest up to $10,000 per company per year via Equity Crowdfunding.
The increase in equity crowdfunding activity is part of a wider trend of startups looking for alternative sources of funding, as traditional sources such as banks become increasingly reluctant to lend to early-stage businesses. Equity crowdfunding provides startups with access to capital from a large number of individual investors, which can be an attractive proposition for businesses that are struggling to secure funding from traditional sources.
The food and beverage industry dominated, with 33 successful offers raising $29.5 million - representing 34 per cent of all funds raised through crowd-sourced funding (CSF) platforms!
Another notable entry into the Top 5 was the Farming and Agricultural industry raising $7.8 million over the 21/22 FY.
Companies of particular interest that made up the Top 10 CSF offers for FY22 were Neutrog ($3 million from 782 investments), Our Cow ($2.6 million) and Black Hops ($2.2 million).
Farmers2Founders Co-Founder and General Manager, Skye Raward said: “We know from the work we do with agrifood startups that raising investment can often be a daunting and confusing process. We saw the opportunity to provide a service to agrifood entrepreneurs by taking the guess work out and supporting them to become ‘investor ready’.”
This increased interest in the market, particularly in regard to F&B, agtech and other agrifood innovations, has seen Farmers2Founder partner with Equity Crowdfunding experts Finley Capital Partners to create a unique 7 week intensive Masterclass Series called ‘Seed Your Growth’, that will help founders and early-stage startups looking to raise capital via equity crowdfunding.
“We know that retail investors are shown to back companies, founders and innovations they believe in – potential investors just may be your customer, suppliers, friends, family and followers.”
“For founders of start-ups, or early-stage growth companies, it is essential to get your business investor ready and learn how to launch an effective campaign BEFORE you raise or are in need of investment.”
The ‘Seed Your Growth’ Masterclass Series is perfect for startups planning on raising capital via equity crowdfunding in the next 3-6-12 months and will be delivered online and face-to-face, and include 1:1 mentoring and deep dive sessions.
If you are new to capital raising, thinking about raising capital via equity crowdfunding, or keen to build your knowledge around investor readiness in preparation to raise capital to support your growth, we are hosting an introductory webinar to introduce you to the ins and outs of equity crowdfunding.