SA equity crowdfunding platform Uprise.Africa has taken a decision to refund all 288 shareholders that took part in SA startup Sun Exchange‘s crowdfunding campaign last year.
The blockchain-based solar panel micro-leasing marketplace raised over R4.2-million through the campaign which concluded in 30 November last year (see this story).
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The platform and the startup put the decision down to delays from the Reserve Bank and Companies and Intellectual Properties Commission (CIPC).
However, the latest news comes just days after the African Crowdfunding Association (ACfA) revealed that it was conducting a review of Uprise.Africa after an exposé by Ventureburn on the platform, its head Tabassum Qadir and a R25-million fake pledge made to SA startup Intergreatme (see this story).
The latest news comes just days after the African Crowdfunding Association revealed that it was conducting a review of Uprise.Africa after an exposé by Ventureburn
Uprise.Africa said in a statement today that while the prospectus for the campaign had been completed for Sun Exchange’s campaign, it still needed to be registered and filed with the CIPC for a formal public offering.
The step, it said, would have been the final stage of the review and approval process before Uprise.Africa issued the prospectus and subscription agreement, and then, share certificates to shareholders.
However, it said because of South Africa’s lockdown due to the Covid-19 pandemic, there has been limited access to government departments, including the CIPC.
“At this point in time, we do not have clarity on when normality will resume with regards to halted commercial and civil activities, nor do we know what the timescales will be on the filing process with CIPC.
“It is with these uncertainties and unprecedented changes to the world in mind, that the Uprise.Africa board has taken the decision to refund all investments made during our Sun Exchange equity crowdfunding campaign,” it said.
In a subsequent call with Ventureburn, The Sun Exchange founder Abraham Cambridge (pictured above) said the decision by Uprise.Africa to refund investor’s in The Sun Exchange’s campaign, came after discussions he held last week with the platform.
While he echoed Uprise.Africa that the discussions emanated after a prolonged closing period and delays in the share subscription registration and subsequent filing with the CIPC, he added that there were also delays in the approvals with the SA Reserve Bank (as the investment involved a US entity).
He said the refund will be made from Uprise.Africa’s trust account, where funds have been held since the pledges were made.
“It’s unfortunate that the deal did not ultimately go through. Sun Exchange worked hard with Uprise.Africa for months to prepare the prospectus and share subscription agreements, as we were eager to have the individuals who participated in the campaign join us as investors and partners,” he said.
However, commenting on the timing of Uprise.Africa’s decision and it coming after ACfA said it would probe the platform, Cambridge said there was nothing untoward in his experience with the platform. “From my experience it’s been fine,” he added.
‘Uprise Africa remains compliant with code’
Meanwhile, Uprise.Africa said in a statement yesterday that the ACfA had completed a review of Uprise.Africa’s compliance with its code of good conduct and is “satisfied” that Uprise.Africa remains compliant with its code.
Uprise.Africa said the review process included members of the board, executive management, and compliance teams of Uprise.Africa.
“The review resulted in recommendations for Uprise.Africa in the areas of risk management and communication. In all other respects, ACfA is satisfied that Uprise.Africa remains compliant with our COGC,” Uprise.Africa said in its statement.
Read more: Uprise.Africa remains compliant with the ACfA’s code [Right of Reply]
Read more: African Crowdfunding Association probing controversial Uprise.Africa
Read more: Questions for Uprise.Africa over alleged fake R25m Intergreatme crowdfunding pledge
Read more: The Sun Exchange raises over R4.2m against R7m target, as crowdfunding campaign closes
Editor’s note (21 May 2020): Subsequent to the publication of this story ACfA released a statement on its review of Uprise.Africa to Ventureburn (see this story).
Featured image: Sun Exchange founder Abraham Cambridge (Facebook)
