Looking for a leg up for your start up? Well a new legislation will make it easier (and more legal) for unlisted public companies to raise money through crowdfunding from mum and dad investors.
The bill did face a lot of criticism from the opposition but it battled through and so now unlisted companies with less than $5 million in assets and turnover can raise up to $5 million through crowdfunding each year.
USA, UK and New Zealand already work under this framework, but this is a first for Australia.
“The intent of this bill is to assist start-ups and other small businesses that may have difficulty accessing equity funding due to the costs of disclosure and other requirements, while protecting mum and dad investors,” minister for small business Kelly O’Dwyer said.
“The government crafted this bill after extensive stakeholder consultation and considering international models.”
This legislation will change the way startups can raise capital. It also has the potential to boost the economy, create more jobs and reach ideas around the world.