1. CROWD-SOURCED FUNDING
PRESENTS OPPORTUNITIES TO CREATE “NEW INCOME STREAMS”
Presented by:
Peter Towers, Managing Director, ESS BIZTOOLS
Marc Johnstone, Chief Operating Officer,
Enable Funding

2. Wanted! Accountancy Firms Committed to Crowd-Sourced Funding
Crowd-Sourced Funding Equity Raising is brand new!
No accountancy business has an historical advantage!
Now is your opportunity!
Don’t miss this great service diversification!
CSF Presents Opportunities to Create "New Income Streams"

3. Crowd-Sourced Funding Is Targeted At......
Small/medium enterprises
Inventors
CSF Presents Opportunities to Create "New Income Streams"

4. Traditional Clients Of.....
Small to medium sized accountants
Your “natural clients”
Don’t encourage them to go elsewhere
Offer them a great service!
CSF Presents Opportunities to Create "New Income Streams"

5. Create a “New Income Stream”
Is the company a potential Crowd-Sourced Funding (CSF) Company?
Proprietary Company to be converted?
CSF Presents Opportunities to Create "New Income Streams"

6. Why Not Analyse Your Clients?
Phase 1 – Legal Tests to be met
Phase 2 – Subjective comments & tests to determine companies that are interested
CSF Presents Opportunities to Create "New Income Streams"

7. Phase 1 – Legal Tests Group turnover/sales under $25M per annum
Group asset value under $25M
Not listed on a Stock Exchange anywhere in the world
CSF Presents Opportunities to Create "New Income Streams"

8. Subjective Comments Company can operate in any type of industry
No age specification for the company
CSF Presents Opportunities to Create "New Income Streams"

9. Phase 2 – Subjective Tests
A. Business Review
Early Stage High Growth and Disruptive (ESHGD) Companies?
Business expansion?
Acquisition of businesses?
Vision for the business?
Does the company require funding to implement these visions?
CSF Presents Opportunities to Create "New Income Streams"

10. Phase 2 – Subjective Tests (cont’d...)
B. Succession Planning
Need for capital injection to facilitate the funding of a shareholder succession?
C. Balance Sheet Review
Does the company have:
Loans – other than bank loan secured on 1st mortgage on the company’s own property
Other bank/finance company loans
CSF Presents Opportunities to Create "New Income Streams"

11. Phase 2 – Subjective Tests (cont’d...)
Loans from family/friends
High credit card debts
Would the directors be interested in raising capital to pay these loans/credit card debts and save interest?
CSF Presents Opportunities to Create "New Income Streams"

12. Capital Raising Raise up to $5M every 12 months
Would these companies be interested?
Present a seminar to brief these selected clients on how their business can benefit from Crowd-Sourced Funding
CSF Presents Opportunities to Create "New Income Streams"

13. Checklist to Assist in Identification
ESS BASIP “Checklist for Identifying Clients for CSF”, will assist you to identify the companies that satisfy the legal requirements and score positively on the subjective tests (BAS5108)
CSF Presents Opportunities to Create "New Income Streams"

14. Create a “New Income Stream”
Preparation of the CSF Offer Document
This will probably require:
Business Plan
Share Price Determination
Budget
Cashflow Forecasts
Company Valuation
Information Memorandum
Professional fees for this work estimated at $20K to $40K
Virtual Chief Financial Officer Services
CSF Presents Opportunities to Create "New Income Streams"

15. Create a “New Income Stream” (cont’d...)
Advising your client on the CSF Intermediary Role
Assisting in the appointment of a CSF Intermediary
CSF Presents Opportunities to Create "New Income Streams"

16. Overview of CSEF Legislation
A CSF offer must be made via the ‘platform’ of a CSF Intermediary
A CSF Intermediary must hold an AFSL under which it is expressly authorised to provide a crowd funding service
CSF Presents Opportunities to Create "New Income Streams"

17. Overview of CSEF Legislation (cont’d...)
In order to make a CSF offer, an entity must publish a tailored CSF offer document on the platform of a single CSF Intermediary and all applications and application monies are to be handled by the Intermediary
All offers must be closed within 3 months (if not stated to close earlier)
CSF Presents Opportunities to Create "New Income Streams"

18. Overview of CSEF Legislation (cont’d...)
The main features of the CSF Bill are:
A retail investor may apply for a maximum of $10,000 per offer within a 12-month period and has an unconditional right to withdraw from a CSF offer within five business days of making an application;
The CSF Bill contains provisions regarding defective CSF offer documents which subject the Intermediary, the issuer and other entities or persons responsible for the offer document to civil and criminal liability;
CSF Presents Opportunities to Create "New Income Streams"

19. Overview of CSEF Legislation (cont’d...)
A number of corporate governance and reporting concessions are available to eligible companies for a maximum of five years from registration as, or conversion to a public company that intends to utilise CSF at the time they are registered
CSF Presents Opportunities to Create "New Income Streams"

20. Overview of CSEF Legislation (cont’d...)
These concessions include an exemption from the annual general meeting requirement and the option to provide only online financial reports to shareholders
Additionally, the company is not required to appoint an auditor for the five year period or until the company has raised more than $1 million from CSF offers or other offers requiring disclosure at any time
CSF Presents Opportunities to Create "New Income Streams"

21. CSEF Intermediaries
A ‘CSF Intermediary” is a financial service licensee whose licence expressly authorises the licensee to provide a crowd-funding service
CSF Intermediaries will need an Australian Financial Service Licence (AFSL) to operate a CSF platform
CSF Presents Opportunities to Create "New Income Streams"

22. CSEF Intermediaries (cont’d...)
The new laws set out other obligations and requirements for CSF Intermediaries, such as:
Gatekeeper obligations
Maintaining open communication channels about the offer while the offer is open or suspended; and
Disclosure requirements as to the financial interest (including fees charged) the CSF Intermediary (or any associate of the CSF Intermediary) has or expects to acquire in the issuer
CSF Presents Opportunities to Create "New Income Streams"

23. Potential Investors Investors with 4 specific segments:
Sophisticated Investor: earning more than $250K per annum or have more than $2.5M net worth (excluding home, including superannuation)
Pro Active Enabler – yo – net assets = $1M
Progressive Enabler – yo – net assets < $1M
Budding Enabler – yo
CSF Presents Opportunities to Create "New Income Streams"

24. Opportunities for Accountants
Opportunity to be involved in:
A high value service for clients
A new revenue line that is high margin
Strategic work
Value add for clients increases loyalty
CSF Presents Opportunities to Create "New Income Streams"

25. Enable Funding Australia’s first crowdfunding platform – founded 2007
$147M raised for 176 companies
World Bank recognition
CSF Presents Opportunities to Create "New Income Streams"

26. Enable Funding A de-risked approach to the new asset class:
IMENCA
AIG
Issuer optimisation services
The need for this asset class in Australia
The lessons from other markets
CSF Presents Opportunities to Create "New Income Streams"

27. In Summary
Crowd-Sourced Funding is a great opportunity for some of your clients to go to the next level
Crowd-Sourced Funding creates “new revenue stream opportunities” for proactive accountants
CSF Presents Opportunities to Create "New Income Streams"

28. In Summary (cont’d...) BASB030 – Procedure Control Form
BAS5005 – What is Crowd-Sourced Funding?
BAS5110 – Company Eligibility Questionnaire – Accountants Use
BAS5115 – Company Preparation Guide
BAS5120 – CSF Offer Document Overview
CSF Presents Opportunities to Create "New Income Streams"

29. Enable Funding - Contact/Questions
Marc Johnstone
CSF Presents Opportunities to Create "New Income Streams"

30. ESS BIZTOOLS - Contact/Questions
Peter Towers
(07) /
CSF Presents Opportunities to Create "New Income Streams"