Investment based crowdfunding sites are the process of raising finance for projects from a collective number of people - the 'crowd' - often utilising an online-based crowdsourced platform through which campaign owners offer options to potential invested, who are both experienced and inexperienced investors.
These investment crowdfunding platform or crowdsourced finance websites involve investment based offering - most of which have the potential for a financial return on investment. CrowdfundUP, for example, is tailored to commercial real estate projects and property developments, with a wide range of investor networks.
Crowdfunding in Australia is a relatively young industry, and business models are evolving. Australian Financial Service rules are being designed, along with regulation andASIC's involvement with regulating crowdfunding platforms.
Investment based crowdfunding must take into account a range of different operational structures, so it is not a straightforward map of crowdfunding activities to be regulated under Australian legislation.
Generally speaking, a crowdsourced funding regime reduces the regulatory requirements for public fundraising, while maintaining appropriate investor protection measures.
A provider of CSF services must hold an Australian Financial Services License (AFSL).
Real estate crowdfunding in Australia is still in its infancy, but there are several platforms you can use to participate such as CrowdfundUP, VentureCrowd, and DomaCom, where all individual Investors can invest from $1,000. To get started, all you need to do is sign up, put together your investment strategy and begin investing in a range of projects that suit you.
The information in this article is general in nature. Any advice it contains is general advice only and has been prepared without taking into account the objectives, financial situation or needs of any particular person.
The article content is not intended to be a substitute for professional advice and readers are urged to seek their own appropriate advice before making decisions.
Any reference to a particular investment is not a recommendation to buy, sell or hold the investment.