F&B, craft brewing, consumer goods turn to Aussie crowd funding

By Leon Gettler, Talking Business

WHAT ARE the big industries now getting crowd-sourced funding? Food and beverage, craft brewing and consumer packaged goods.

That’s the result of a survey done by Birchal, an Australian equity crowdfunding platform that connects investors with brands.

“It shows stability and resilience in fund raising, particularly for early stage businesses,” Birchal co-founder and CEO, Matt Vitale told Talking Business.

He said Birchal had shown that crowd sourced funding was a reliable way for early stage businesses to raise capital and build communities.

Mr Vitale said it was also good for start-ups as well as early-stage businesses and small businesses. 

“We have a vision that all offers should be crowd-sourced funding offers,” he said,

“This is a very practical way that entrepreneurialism can be supported and fuelled in Australia.”

This was particularly at a time when there wasn’t much venture capital for early stage businesses in Australia, apart from those in mining, and the banks tightening up on lending.

He said early-stage businesses in Australia struggled to raise capital. Instead they were doing what they had to do by maxing out credit cards and re-mortgaging houses.

“The revelation has been that early-stage businesses can raise equity capital, something that historically has been only the domain of large typically listed businesses,” Mr Vitale said.

Mr Vitale said Australians tended to compare their equity market to the United States, which was the largest pool of venture capital on the planet where the money, and there was plenty of it, had to be put to work.

“In Australia, we don’t have that mindset, we’re not set up in that way but equity crowd funding is a great way to unlock a greater investment universe and I think increasingly, people who are investing in other asset classes, they don’t know how to get exposure to venture type investments,” he said.

“What we’re able to do is enable companies to open their opportunities to a national audience of investors and find their crowd, find their community to support them.”

He said investors in food and beverage and craft brewing companies understood those sorts of industries and could relate to those sorts of businesses.

“They’re often businesses that people want to be associated with,” Mr Vitale said. “What people have found is they can source their capital from their customers. They already know about your product, they understand your business.

“For the businesses, it’s not just the capital. They’re building a connection with often their most passionate customers by involving them in the business.”

Mr Vitale said Birchal’s goal was to expand the footprint for crowd-sourced funding.

Health care is now a growing area for crowd sourced funding.

Mr Vitale said last year was a big year for investors focused on medicinal cannabis.

“We’ve noticed there a lot of investors who are incredibly passionate about medicinal cannabis and other alternative medicines,” he said.

“I think this year we will start to see that expand to businesses that are in the psychedelics space.”




Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness




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