Fundnel, a Singaporean equity crowdfunding platform, announced today it has received a provisional Capital Markets Services (CMS) license from the Monetary Authority of Singapore (MAS) — clearing a major regulatory hurdle within the industry.
The startup is a platform that facilitates the sale of securities in growth-stage and pre-IPO companies, and receiving the license allows Fundnel to openly market itself as an ‘equity crowdfunding’ service.
“We [would] like to thank MAS for making this possible and commit to offering quality private investments on our platform. With due compliance to business conduct rules that seek to safeguard investors’ interests, our mission lies in connecting investors to promising private investments in an efficient, effective, and open manner,” said Kelvin Lee, CEO and Co-Founder of Fundnel in a statement.
The one-year-old company has closed 15 deals and helped businesses raise US$44 million through its platform. Fundnel does not target mom-and-pop investors as only institutional and accredited investors can invest through the platform.
The company has a network of investors that do their due diligence before making an ‘anchor investment’. Only after an anchor investment is made can follow-on investors contribute and create the ‘crowdfunding’ aspect of the platform.
Entrepreneurs that are looking to raise money for their companies can choose among four models: mandatory convertible bonds, convertible bonds, debt and revenue sharing.
Fundnel is trying to ‘democratise the investment industry’ by providing entrepreneurs with an alternative channel for financing beyond traditional routes like VCs or bank loans.
“Staying ahead of the curve is imperative in any industry as we differentiate ourselves through the quality of our investment offerings. Echoing the trend of emerging technology companies in the market, we strive to be equally disruptive,” said Lee.
Since inception, the company has taken a regional approach (it has offices in Indonesia, Malaysia and India) but the CMS license approval provides more freedom to operate within its home base.
In June, the company inked a partnership with the Business Angel Network of Southeast Asia to help establish an early stage investment vehicle.
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