Today, we see a lot of well-known investors becoming shareholders of startup companies despite us not coming across news about the funding. Many of us are curious to know more about these investments and the processes behind them, and whether they are legal.
Get to know more about Investment-Based Crowdfunding, which is currently an interesting trend.
What is Investment-based Crowdfunding?
Investment-based Crowdfunding is a means of raising ‘finance’ for projects and could be divided into two types: 1) Debt-based Crowdfunding (collecting money from the public, in which investors will receive interest-based income) and 2) Equity-based Crowdfunding (collecting money from the public, in which investors will receive equity ownership in the business).
Which type of investment should you choose?
Debt-based Crowdfunding is currently trending, as investors earn revenue by means of interests and will receive the amount they funded back once the settled date arrives. Essentially, this type of investment derived from SMEs requiring funding to finance ongoing projects, and consequently offering loan-based assets to interested investors.
Debt-based investments are generally offered by public companies or large firms. Today, crowdfunding is also authorized for SMEs with legal entities — this includes debt-based crowdfunding. This is therefore another opportunity for investors who wish to diversify their ventures.
Get to Know Siam Validus — Thailand’s Provider of Investment-Based Crowdfunding Solutions
Siam Validus Capital is a digital platform offering innovative, crowdfunding solutions. The licensed firm acts as an intermediary for the funding of small and medium-sized businesses (SMEs) through crowdfunding debentures. While SMEs could offer crowdfunding debentures via the platform, investors are also able to browse through debentures they are interested in.
What is the current value of digital crowdfunding platforms?
While the concept of crowdfunding is relatively new to Thailand, Siam Validus by Validus Group has a rich experience and has been operating for more than six years across four countries, including Singapore, Vietnam, Indonesia, and Thailand. The firm is considered an industry expert and is well-respected on an ASEAN level with a current investment value of 16 billion baht.
What is Siam Validus known for?
Apart from being a trusted platform, Siam Validus is also known for implementing innovative technology in evaluating the qualifications and quality of SMEs looking to raise funding. These are the following mechanics:
- The implementation of Surrogate Data Analytics in assessing creditworthiness
- Being allies with large corporations such as SCG Distribution, who assists with developing programs that enable easier access to SMEs
- The usage of data-driven and AI tools to select SMEs and evaluate investment risks
Is investment-based crowdfunding legal?
Legally verified by The Securities and Exchange Commission (SEC) in Thailand, Siam Validus has been a trusted crowdfunding platform. Keen investors are invited to validate this in detail with the SEC via https://market.sec.or.th/licensecheck/companydetail/0000032114
Based on the aforementioned information, we hope interested investors are now more familiar with the concept behind investment-based crowdfunding and trust Siam Validus as a digital platform of choice for both SME fund-raising and investment purposes.
*Important remark: Investing in crowdfunding debentures is ideal for investors with knowledge and understanding of the risks involved. Investors should be able to make his or her own financial decisions, wherein the investment type is suitable for those who want to diversify their portfolio. With debt-based crowdfunding, investors should consider illiquid investments and investing until the maturity of the debenture. Note that debt-based crowdfunding is not guaranteed by third parties and is not protected by any government agency. Thus, prior to any decision it is necessary that investors understand the nature of debt-based crowdfunding, thoroughly study its terms and conditions, and be prepared for any risk that may arise.