Seedrs to Expand Crowdfunding Efforts to US with Acquisition of Junction

Thursday, 30/10/2014 | 15:00 GMT by Ron Finberg
  • With further easing of US equity crowdfunding rules, UK regulated Seedrs acquires California based Junction as they expand to enter the US market.
Seedrs to Expand Crowdfunding Efforts to US with Acquisition of Junction

Seedrs, a UK regulated Crowdfunding firm, has announced that it is acquiring San Francisco-based Junction. With the acquisition, Seedrs, which extended its crowdfunding platform throughout Europe in 2013, plans on expanding to the US. Joining Seedrs and becoming co-Heads of Seedrs America, are Junction’s Co-Founders, Adam Kaufman and Brian Goldsmith.

Unlike the UK where the FCA has issued guidelines on equity crowdfunding, allowing it to become a product accessible by the entire investing public, in the US it is limited to accredited investors. As a result, much of the innovation of widening crowdfunding as an alternative investment around the world is taking place outside the US. Guidelines for widening the availability of crowdfunding to retail investors in the US do exist under the yet to be implemented laws of the JOBS Act. However, even upon becoming approved, JOBS Act guidelines provide limits on firms using crowdfunding to raise money, which may detract from the effectiveness of crowdfunding to attract solid firms to invest in.

Nonetheless, for Seedrs, the potential of a cross-Atlantic platform does provide benefits. Although Regulation across regions differs, Seedrs may be able to unify their investing platform to connect more firms and investors from across the globe; thus providing an economy of scale for crowdfunding users. Earlier this year, Seedrs proved its ability to show the benefits of crowdfunding beyond just startups, as publicly traded Chapel Down Group used the platform to sell equity and raise awareness of its company.

According to Seedrs in a blog post about the acquisition, the deal was the result of nearly a year of contact between the firms. Founded in 2012, Junction is registered as both a broker-dealer and investment adviser in the US.

Seedrs, a UK regulated Crowdfunding firm, has announced that it is acquiring San Francisco-based Junction. With the acquisition, Seedrs, which extended its crowdfunding platform throughout Europe in 2013, plans on expanding to the US. Joining Seedrs and becoming co-Heads of Seedrs America, are Junction’s Co-Founders, Adam Kaufman and Brian Goldsmith.

Unlike the UK where the FCA has issued guidelines on equity crowdfunding, allowing it to become a product accessible by the entire investing public, in the US it is limited to accredited investors. As a result, much of the innovation of widening crowdfunding as an alternative investment around the world is taking place outside the US. Guidelines for widening the availability of crowdfunding to retail investors in the US do exist under the yet to be implemented laws of the JOBS Act. However, even upon becoming approved, JOBS Act guidelines provide limits on firms using crowdfunding to raise money, which may detract from the effectiveness of crowdfunding to attract solid firms to invest in.

Nonetheless, for Seedrs, the potential of a cross-Atlantic platform does provide benefits. Although Regulation across regions differs, Seedrs may be able to unify their investing platform to connect more firms and investors from across the globe; thus providing an economy of scale for crowdfunding users. Earlier this year, Seedrs proved its ability to show the benefits of crowdfunding beyond just startups, as publicly traded Chapel Down Group used the platform to sell equity and raise awareness of its company.

According to Seedrs in a blog post about the acquisition, the deal was the result of nearly a year of contact between the firms. Founded in 2012, Junction is registered as both a broker-dealer and investment adviser in the US.

About the Author: Ron Finberg
Ron Finberg
  • 1983 Articles
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About the Author: Ron Finberg
Ron Finberg, a specialist in regulatory issues, brings clarity and depth to finance news
  • 1983 Articles
  • 8 Followers

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