Exclusive: Startupbootcamp Cape Town, EasyEquities to crowdfund first cohort

Startupbootcamp Cape Town has partnered with investment platform EasyEquities to crowdfund the 10 startups that last week graduated from the initiative’s inaugural programme.

The announcement was made last week Thursday (30 November) by Startupbootcamp Cape Town managing director Zachariah George at the accelerator’s Demo Day held at Ratanga Junction Conference Centre in Cape Town.

“This has never been done before, on the African continent or at Startupbootcamp anywhere in the world,” said George.

Potential investors can view more at http://crowdfunding.easyequities.co.za/.

The page lists 15 December as the date the investment round will open, however when contacted Purple Group  vice-president for business development Almero Oosthuizen told Ventureburn that the round will instead open on 15 January next year. The website had yet to be updated when this story went live.

The investment window will then be for 90 days — or less, depending on investor demand.

“This is not a traditional startup crowdfunding solution,” he said. “We are testing this solution with our community, and therefore the total investment available is only around R600 000 (across all 10 startups),” he said, adding that if the round proves successful EasyEquities will look to “enhance” and “extend” it.

The investment round will open later this month on the EasyEquities site from 15 December

When the round opens, potential investors will be able to invest in a private company — associated with Startupbootcamp Cape Town and incorporated in Mauritius — with an equally weighted investment in each of the 10 startups.

He said the round is targeted at small investors, mainly millennials (those under 35 years old), who may have previously been excluded by requirements other crowdfunding platforms have such as certain minimum investment amounts and other intimidating requirements.

“By investing in this private company, the investor will get equal exposure to a ‘basket’ of startup companies,” he said.

Read more: Inaugural Startupbootcamp Cape Town secures 32 agreements with corporates

He said EasyEquities — which is an authorised Financial Services Provider — is currently allowing prospective investors to register their interest on the site. “Everyone that registered their interest in participating will be notified accordingly,” he added.

However, he said not everyone will be allowed to invest in the private company. Before the potential investors are allowed to make any investments on the site, they will have to complete a short questionnaire which will highlight the risks associated with this type of investment, ultimately qualifying the investor.

Asked whether EasyEquities had sought approval from the Financial Services Board (FSB), Oosthuizen pointed out that the licensing requirements for equity crowdfunding “will not be applicable in this case”.

“We are not offering investors the opportunity to crowdfund the underlying startup directly, but rather an opportunity to invest in a private company (held in Mauritius – ed) that in turn will give the investor equal exposure to the startups concerned, as a result of the private company’s investment in the startups,” he said.

Featured image: Startupbootcamp Cape Town inaugural cohort (Supplied)

Editor’s note (7 December 2017): EasyEquities clarified in an email that though the investment round will only open from 15 January 2018, people are able to opt in now via the live page.