Crowd Valley co-founder, Paul Higgins' presentation at Startup Camp Berlin, March 16th 2013

1. Company building online through
crowdfunding!
Paul Higgins
Co-founder, Crowd Valley
March 16, 2013
Startup Camp Berlin

2. @paulhigginz @crowdvalley #scb13
Overview!
• Grow VC Group – the crowdsourced company
• Crowdfunding in connected ecosystems
• Where crowdfunding is going next

3. @paulhigginz @crowdvalley #scb13
Background – Grow VC!
• Global marketplace for startup funding
• Founded 2009
• “Everyone Funding Startups”
– 2012 - $35M raised
– 5,000+ startups
– 190+ countries
– Several raised rounds, first exits

4. @paulhigginz @crowdvalley #scb13
Cintep (Australia): First $100,000 from equity crowdfunding!

5. @paulhigginz @crowdvalley #scb13
Regulatory activities!
• US Delegation in Transatlantic Economic Forum
• Cooperation with Singapore Government Investment Company, UKTI, etc.
• Crowdfunding Regulatory Intermediary Association (CFIRA)
• Crowdfunding Professional Association (CFPA)
• National Crowdfunding Association (NLCFA)
• European Crowdfunding Network (ECN)
• Cooperation with Securities and Exchange Commission (SEC) and Financial
Industry Regulatory Authority (FINRA)

6. @paulhigginz @crowdvalley #scb13
H.R. 3606: Jumpstart Our Business Startups (JOBS Act)!
Title II
• Online Solicitation of Accredited
Investors
• This part opens possibility market, sell
and trade private securities in market
places
• This part can have more important
influence on later funding phases than
the early phase crowdfunding
Title III
• Crowdfunding with non-accredited
investors

7. @paulhigginz @crowdvalley #scb13
Effective Dates of the JOBS Act!
Title
I
(Crea'on
of
EGCs;
“IPO
on
ramp”)
Largely
effec've
on
enforcement.
Title
II
(Amendments
to
General
Solicita'on/ The
SEC
had
been
scheduled
to
propose
new
rules
by
Adver'sing)
4
July
but
did
not
do
so
un'l
29
August.
Final
rules
not
likely
before
end
of
1st
quarter
2013.
Title
III
(Crowdfunding)
The
SEC
is
required
to
adopt
new
rules
by
31
December
but
most
expect
these
changes
to
be
implement
in
mid/late
2013
Title
IV
(Increasing
Reg
A
offerings
to
up
to
$50
Not
yet
effec've,
date
unclear.
million)
Title
V
(Increased
thresholds
for
registra'on
with
SEC)
Largely
effec've
on
enforcement.
Title
VI
(Increased
thresholds
for
registra'on
with
SEC
Largely
effec've
on
enforcement.
for
banks)

8. @paulhigginz @crowdvalley #scb13
Grow VC Group!
• Launched spin-off Crowd Valley in 2012 to provide crowdfunding
infrastructure:
– Configurable platform
– Shared business networks
– Back Office financial services
• Spun out other companies providing various services to support new online
funding marketplaces
– Grow Advisors
– ChangeLab23
– Mutual Seed Fund
• Developed a portfolio through global incubation services
– 5 portfolio companies to date

9. @paulhigginz @crowdvalley #scb13
Finance and Infrastructure Investment
Services Portfolio

10. @paulhigginz @crowdvalley #scb13
Crowdsourcing a company!
• 10,000 people expressed an interest in getting involved with Grow VC
• Global network of 100+ associates
• Culture of openness, accountability, honesty
• Rewards proportional to commitment
• No recruiters
• No interviews
• No external funding

11. @paulhigginz @crowdvalley #scb13
Work and resource investments!

12. @paulhigginz @crowdvalley #scb13
Crowd-sourced startup acceleration!

13. @paulhigginz @crowdvalley #scb13
Crowdfunding in connected ecosystems!
• How crowdfunding works
• Opportunities in crowdfunding
• The importance of ecosystems
• Alternative asset types

14. @paulhigginz @crowdvalley #scb13
Crowdfunding is…!

15. @paulhigginz @crowdvalley #scb13
Crowdfunding platforms can provide…!
• Validation of an idea
• Relationships with new potential customers
• Matchmaking between investors and entrepreneurs
• Efficient access to capital
• Standardised documentation, e.g. Shareholder Purchase Agreements
• Access to talent

16. @paulhigginz @crowdvalley #scb13
Investment crowdfunding works: the proof!
Source: thecrowdcafe.com

17. @paulhigginz @crowdvalley #scb13
Where crowdfunding is today!
Source: crowdsourcing.org

18. @paulhigginz @crowdvalley #scb13
Crowdfunding must be part of existing ecosystems!
• Crowdfunding does not happen in a vacuum
• “Invest in Lines, not Dots” – venture capitalist, Mark Suster:
Images from bothsidesofthetable.com/2010/11/15/invest-in-lines-not-dots

19. @paulhigginz @crowdvalley #scb13
Building an entrepreneurial ecosystem in your city!
Funding platforms
Angel networks
Investor pitch events
Government programs
Accelerators
Incubators
Universities

20. @paulhigginz @crowdvalley #scb13
Manage angel pitch events!

21. @paulhigginz @crowdvalley #scb13
Measure progress with scorecards and evaluations!

22. @paulhigginz @crowdvalley #scb13
A ’typical’ startup path!
Funding platforms
Angel networks
Investor pitch events
Government programs
Accelerators
Incubators
Universities

23. @paulhigginz @crowdvalley #scb13
Find your natural constituency!
Source: crowdsourcing.org

24. @paulhigginz @crowdvalley #scb13
Crowdfunding is about more than just startups…!
• Expanding a mezzanine fund for Oil & Gas investments in Rio de Janeiro
• Reducing risk by ‘leading’ rounds alongside new angel investors in Moscow
• Doctors financing R&D for new medical device companies in Sydney
• Alumni supporting their university’s entrepreneurship in San Francisco
• Offering debt opportunities based on real estate in London
• Connecting traders of precious stones with professional investors in New
York

25. @paulhigginz @crowdvalley #scb13
Where crowdfunding is going next…!
• Powerful and informative provider of data
• Efficient marketplaces in diverse sectors
• Integration with the rest of the ecosystem
– Universities
– Incubators
– Angel investors
– VCs
– Institutional funds
• Co-investment models
– Active
– Passive

26. Company building online through
crowdfunding!
Paul Higgins
@paulhigginz @crowdvalley
paul@crowdvalley.com