Boosting Crowdfunding

In an attempt to also boost crowdfunding, UK Government has announced that they will raise the funding limit below which it will be not necessary for companies to provide an expensive investment prospectus from €5m to €8m. The move will take effect on 21 July 2018.

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Source: Pexels.com

According to experts, the move also suggests the willingness of the government of not losing ground in the fintech race in view of Brexit by matching a similar change recently made by Germany which announced the same funding limit.

A spokesperson of the UK Crowdfunding Association (UKCFA) told Crowdfundinsider:

The economics of the previous threshold no longer added up, creating a distortion in the market which has now been addressed. This means that a new sector of ‘scale up’ businesses will be able to benefit from the option of choosing crowdfunding as a route to funding their growth and success. It also helps maintain the UK’s competitive position as a great place to start and scale a business.

Luke Lang, Co-Founder and CMO of Crowdcube, the leading equity crowdfunding platform in the UK, told the FT:

We will now be able to attract growing businesses that are more mature. Entrepreneurs will not have to rely on venture capital. It is a great opportunity for our investors.

Find out more here and here.

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