The UK is looking to boost access to capital for private firms – beyond the existing crowdfunding regime and established exchanges.
Currently, for approved investment crowdfunding platforms it is difficult to raise more than £5 million due to prospectus requirements. The proposal aims to make it easier for companies to raise more than £5 million – including retail investors. The £5 million cap aligns with the €8 million prospectus hurdle in the EU.
The FCA wants to provide sufficient investor protection rails while streamlining the capital raising process.
If approved, companies looking to raise money beyond existing public markets may do so via a Public Offer Platform or POP. This will definitely impact the crowdfunding industry, perhaps creating a significant opportunity for established platforms that are already regulated by the FCA.
The Consultation is available below.