“Tell me what I have to do to have you finance me.”
A sentence uttered in the 1970s in California by a bearded, funnily dressed, young and naïve college drop out. The man in question was looking for the first investment in his project. Together with his partner, he planned on revolutionizing the market of personal computers. He met with many investors, and several turned him down because they either didn’t understand the market or they didn’t believe in the seriousness of this young Californian. It’s safe to say that those who turned down an investment of $ 50,000 for a third of the company are regretting that decision today because that company went on to become the first publicly traded company with a market capitalization of $1 trillion.
If you had not guessed by now, the man in question was Steve Jobs and the company was Apple. A company started in the garage of 2 young men with a dream of making computers more user friendly. Those that managed to invest early on made an incredible profit and today everyone is always looking for the next unicorn. Which funnily dressed person may take the world by storm next?
While identifying the next possible unicorn is one thing, having access to it is another. Companies may only accept investors willing to invest a considerable sum to limit the number of investors they have to manage. Indeed, as investors, you will want to receive updates on the state of the company and be kept in the loop but for the management of the company, this can take a lot of time and resources they probably prefer spending on the growth of the company.
The solution? A crowdfunding platform, but not only just a crowdfunding platform. The real solution is a crowdfunding platform that manages a pooling vehicle. Such vehicle allows companies to pool the investments of several investors into 1 big investment that speaks with 1 voice. It is a win-win for the company and for the investors. As investors, you have access to targets that you may not have been able to invest in otherwise and your voice carries a greater weight. For the company - depending on the form of the pooling vehicle - they only have 1 investor to manage instead of several.
Thanks to its decade-long experience managing investors through its crowdfunding platform and pooling vehicle (Spreds Finance), Spreds has established itself as a major player in the Belgian financial landscape. That’s why, in the upcoming year, Spreds will be publishing a series of articles that highlights some of the most important questions to keep in mind when thinking about investors’ management.
While there are different ways to organise investors’ management, the main takeaway is: investors need a pooling vehicle to be professionally and independently managed, which means that the management of the vehicle shouldn’t be left to the company you are investing in.
In this upcoming series of articles, we will delve deeper into different topics, discussing the main points of attention as well as the dos and don’ts. Our goal is to make sure you understand the advantages of a pooling vehicle and can determine the most important characteristics. The topics that will be addressed are the following:
- A comparison of different pooling vehicles.
- The benefits of using a pooling entity (with legal personality).
- The best ways to put an efficient governance in place.
- How to organise the reporting with different groups of investors.
- What the pooling of investors means in terms of investors’ rights.
- What the pooling of investors means for the transferability of the shares/loans.
- The consequences of an IPO/exit for the pooled investors.
- How to make sure the investors benefit from fiscal transparency.
- Best practices in terms of management of pooled investors.
- We will close this series of articles with a global overview of the main takeaways.
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Who is Spreds?
Spreds helps meaningful businesses grow by connecting them to an active community of potential investors.
As the leading equity crowdfunding platform in Belgium, Spreds allows ambitious investors and entrepreneurs to come together in order to create success and boost the Belgian economic landscape.
More than 45,000 potential investors are present on the Spreds platform and are willing to provide their financial support, knowledge and connections to allow entrepreneurs achieve their dream and gain more visibility. Spreds offers them extensive support during the preparation of the campaign to help them raise funds responsibly. After the campaign, Spreds provides services to help them alleviate risks and burdens associated with the management of investors.
The investor community has access to an average of 1 new investment opportunity per week with transparent information needed to select the investment that speaks to them. To help investors invest responsibly, Spreds manages tax incentives related matters and provides diversification tools.
Based on its expertise, Spreds also offers transaction, investment management and pooling services to companies and professionals in need to make the management of their investors more efficient.