News Briefing - Crowdfunding, SME And Alternative Finance

read, talk, share, invest: crowdfunding needs social skills

1. UK - Equity

The app-based Starling Bank plans to offer more services to  offering more SMEs, it announced at a London event.

Megan Caywood, Chief Platform Officer told  the MoneyLive Lending 2018 event about the firm's ambitions in the SME market:

"We started with a retail current account and then we launched business accounts, first for limited companies with a single director and now for sole traders as well, and soon for multi-director limited companies. We’re very much focusing on the space of one to 10 employees. We obviously want to be in the U.S. as well. We want to be a global bank and we want to eventually expand in Asia, but not currently. We’re first looking at EU and the U.S."

Starling initially launched in 2017, withapp-only current account services for consumers, then added business acounts and  special accounts for 17- and 18-year olds.

Read more about Starling Bank on Tamebay.com

2. UK - Equity

Another app-based business focused on solving a niche  problem is celebrating a successful equity crowdfunding raise.

BubbleStudent has successfully raised over £430,000 from investors on Seedrs. The app offers  a virtual property marketplace for student accomodation. The app allows students to view rooms, schedule viewings and sign contracts, and already lists 200,000 student rooms across 20 UK cities."The student rental market has long been in need of a drastic change, and we're committed to simplifying the entire process for students across the UK; from the first discussion to signing the contract," said CEO and co-founder Felix Henderson.

Read more about BubbleStudent on BusinessCloud.

3. UK - SME Lending

Leicestershire-based peer-to-peer lender ThinCats ihas new offerings aimed at businesses with smaller borrowing needs. 'Smaller' in this case is a relatiive concept: the loans will be in the range of  £100,000 to £500,000. 

The Business Desk reports that ThinCats’ new Generator product will be data-driven, "but ultimately the decision on whether to fund or not will be made by a regional head of credit who has an understanding of local businesses."

More details of this story, read The Business Desk.

4. US - Regulation

The North American Securities Administrators Association (NASAA) has warned crowdfunding investors to be especially careful bfore they invest in any marijuana-related businesses.

Marijuana is legal in some US states but not others. The NASAA has identified some fraudulent schemes, but there's also a due diligence element. In order to assess the value of a stake in a marijuana business, investors need to understand not only the company, but the applicable laws in the state(s) where the company intends to operate, and the ways those laws could change.

“Even if marijuana is legal in a jurisdiction, and the promoters have no fraudulent intent, most marijuana-related investment opportunities are in high-risk startup ventures with a significant chance of failure,” the NASAA advisory says.

Read more about the risks of marijuana-related crowdfunding in ThinkAdvisor.

5. International - Fintech

A variety of developments in different African countres have come to our attention since the weekend.

Binance has opened a Fiat-to-Crypto currency exchange in Uganda - details on Crowdfund Insider

Meanwhile, in the southern part of the continent, the Zambian Central Bank is warning th population that Cryptocurrencies are not legal tender in Zambia, and users are talking a risk - also covered on Crowdfund Insider.

Nigeria is focused on cash, and peer-to-peer lending to help farmers. This story is covered by Reuters and Gulf Times.

6. International - Fintech

China's regulators continue to clean-up the country's peer-to-peer lending sector, after a series of failures in a lightly-regulated industry led to widespread concern and some unrest. 

ChinaKnowledge reports that stricter guidelines and laws will force smaller companies out of the industry, if they cannot meet the new stringent criteria .

China Economic Review expects the number of platforms in operation could dwindle the numbers of operating firms from the thousands to as few as 50 in the next year.

Reddit has a thread about How China’s Peer-to-Peer Lending Crash Is Destroying Lives.

7. International - Equity

Stockhead, the Australian startup-investment news site, looks at the risks of failure in equity crowdfunding.

Australian Securities and Investments Commission commissioner John Price  told Stockhead.

“Our view is the Australian experience with the new equity crowd funding laws is not out of line with the experience seen in many other jurisdictions,” 

“Crowd funding is often used by early stage businesses with no track record. That may mean it is difficult to raise the funds needed or if the funds are raised that the business later fails."

It's refreshing to see the subject covered in a thoughtful way, rather than the binary "no risk = do it; risk = don't do it" message

A good read for equity crowdfunding investors in any country. Read the whole article on Stockhead.