Birchal, the largest investment crowdfunding platform in Australia has distributed a report updating on the activity of issuers pursuing online capital formation in the country. “Crowd-sourced funding,” as online securities offerings are labeled in Australia, are said to have remained “stable” generating A$71 million during 2023 even during a challenging economic environment. The other two main investment platforms are Equitise and OnMarket. There are several other smaller platforms in the market.
At the same time, the report states that venture capital has cratered, declining by 58% in Australia and initial public offerings (IPOs) have dropped as well.
Birchal’s annual report cites 82 securities offerings across the industry during the year. These issuers garnered more than 35,000 investments. The funding volume is similar to the year prior.
Birchal believes that online capital formation is maturing in the country with 41% of successful funding rounds were by firms with more than A$1 million in revenue. This is in contrast to just 16% of issuers in 2020. Issuers raising more than $1 numbered 92.
In 2023, 26% of issuers with successful funding rounds were said to be generating positive earnings compared to just 12.5% in 202o.
As the largest platform in Australia, Birchal reports having raised A$53 million in 2023. This was from 57 funding rounds backed by more than 29,000 investors. The average raise on the Birchal platform stood at A$926,000 – higher than the year prior – while the industry average was A$761,000.
Equitise raised A$6.5 million with 9 successful funding rounds and OnMarket raised A$7.1 million for 5 offerings. The rest of the pack raised just A$4.4 million for 11 funding rounds.
The 4th quarter of 2023 was said to be the busiest ever for Birchal as it listed 27 successful funding rounds including its self-hosted offering for equity in Birchal. The company raised A$2.4 million – the second time it has financed itself. In total, Birchal has self-crowdfunded A$5.39 million.
Since new regulations were incorporated in Australia in 2018, the industry has successfully funded 380 rounds raising $289 million. Birchal claims A$196 million of this amount for 249 funding rounds.
Top sectors that have pursued online capital formation tend to be consumer facing with Food and Beverage holding the top spot in 2023 raising $28 million. Beer companies took over half of this amount (A$ 14.3 million).
Healthcare firms came in 2nd – dominated by Cannabis companies – raising $13.3 million.
Birchal co-founder and CEO Matt Vitale says investment crowdfunding has remained stable stating this is “no small feat” given the funding environment.
“It has been another solid performance for Australia’s equity crowdfunding industry,” says Vitale. “Whilst the 2023 result for the industry as a whole has reported similar volumes to 2022, and system growth was flat, being able to maintain this level of funding reveals the substantial contribution of CSF to the ecosystem and is further evidence that despite persistently challenging funding conditions, equity CSF remains a lifeline and reliable source of capital for Australian startups.”
Birchal predicts a better 2024, expecting a “surge in thematic investments.” Birchal does not share any insight into issuers soliciting both retail and institutional investors – a factor that some industry insiders believe is vital for it to scale.
If you are interested in downloading the report you may access it here after providing contact information.
Top Funding Rounds in Australia
| Company | Amount Raised/ Investors / Month / Platform |
| Cannaponics | $5m from 2,771 investors in May 2023 (Birchal) |
| Medigrowth | $3.5m from 2,047 investors in August 2023, (Birchal) |
| Naked Life Spirits | $3m from 935 investors in July 2023, (Birchal) |
| Old Young’s | $2.7m from 855 investors in March 2023, (Birchal) |
| Hydrowood Holdings | $2.4m from 668 investors in July 2023, (OnMarket) |
| Birchal | $2.4m from over 1,149 investors in December 2023, (Birchal) |
| Dargo Hotels | $2.3m from 412 investors in June 2023, (OnMarket) |
| Philter Brewing | $2.2m from 1,296 investors in November 2023, (Birchal) |
| Our Cow | $2.1m from 1,149 investors in March 2023, (Birchal) |
| Zhik | $2m from 116 investors in April 2023, (Equitise) |