September 23, 2013 will mark a new era in financing. The JOBS Act's upcoming changes to the ban on general advertising and general solicitation will no doubt bring many securities operations online and into the digital age. How can securities professionals leverage this new opportunity in the financial markets?
Crowd Valley has set out to answer that question. The NY based company has built a technology platform (Platform as a Service) that allows asset managers, investment advisors, broker dealers and other securities professionals to bring issuers, investors and securities transactions online – all under their own name, brand and management.
“Crowdfunding and the peer-to-peer market has evolved significantly, since the discussion started in the mainstream a few years ago” points out Crowd Valley CEO, Markus Lampinen. “We support a variety of crowdfunding, peer-to-peer and alternative asset marketplaces, and are able to provide services to all market participants, for the entire lifecycle of the security. This gives us an interesting position to see the various trends and we have seen evolution in the profile of the investors and issuers right through to new industries and market, like real estate and even renewable energy.
The company has seen significant demand for its services come from all over the world, with most action currently in the US, the UK, Germany, Italy, Hong Kong and Singapore. Small and medium sized players, both issuers and their advisors, in niche markets have been particularly active as the ability to market and develop investor interest online has expanded the potential capital market from which they can raise funds.
For a securities firm looking to take advantage of opportunities in the nascent market, the Crowd Valley technology platform supports various assets and models, giving the securities firm access to bring their operations or some part of them onto the private, password protected or open to join network.
Often professional organizations expand their existing operations with the online reach or otherwise complement their activities with more online efficiency. Yet there are firms that are also looking at the potential expansion to non-accredited investors, once the JOBS Act is fully implemented.
“We at Crowd Valley work with professional securities firms, which means many of our customers operate under existing regulations and best practices,” Lampinen says. “However, we are seeing plans put in place by many professional organizations as well, to expand their offerings to retail investors in a way that complements their current business.”
It's pretty straightforward really, he says. Issuers, broker dealers and other market participants are simply looking for the most exposure and potential possible, and ”the digital-only world provides that exposure in a way that the analog world never could.”
Crowd Valley already supports early stage equity marketplaces, all the way to later stage alternative assets with institutional investors, and has a broad visibility into the development of the various markets.
Lampinen says the new market provides many opportunities for professional firms to create efficient and streamlined ways of matchmaking deals. “This is true from the first offering, to closing and settling the offer, all the way through to investor relations.”
The market has grown significantly in the recent years, despite still being widely considered nascent. Surely there are several opportunities in the new securities market, but taking advantage of them can be complicated. The key is finding trustworthy partners with experience in the industry.
[Chart via Crowd Valley]
David Drake is an early-stage equity expert and the founder and chairman of LDJ Capital, a New York City private equity firm, and The Soho Loft, a global event-driven financial media company. He writes regularly for Forbes and Thomson Reuters. You can reach him directly at [email protected] for comments.