What is Sustainable Investing?

This blog was originally written by our KorePartners at Raise Green. View the original post here

OK, How Does Sustainable Investing Work?

Some investors seek to make a positive social and environmental impact with their investments and thus, they don’t simply look at the companies who will make them the most money from the get-go. Rather, they seek those companies who are working tirelessly to address a vast array of societal problems. As a result, sustainable investing is also referred to as socially responsible investing (SRI) or ESG investing, as it encompasses the idea that the investor is strongly influenced by environmental, societal, or governmental factors, before contributing money to a particular company. With this type of investment, people are seeking not a short-term financial return, but a longer-term financial return in which their money is being used as a medium for societal progress, environmental impact, and corporate responsibility. In fact, financial return goes hand in hand with ESG progress, as companies with stronger ESG profiles may generate more sustainable profit and cash flow because they tend to be more competitive than their peers (“ESG factors and equity returns – a review of recent industry research,” 2021). Sustainable investing places increasing emphasis on how investments contribute to the good of society, irrespective of how much money was made in the short run.

Sustainable Investing Objectives

Sustainable investing, as a catalyst for societal change, has seen it’s popularity rise in recent years in the face of the climate crisis and compounding social issues. Impact investing serves as one of the catalysts, alongside millennial investors driven by principles, that is lighting a fire under investors to invest their money in companies whose “intrinsic values” drive positive change (“What is Sustainable Investing?,” HBS). Sustainable investing pushes companies to embrace sustainable principles, which can lead to more impactful social and financial returns later on. With respect to Raise Green, sustainable investing is particularly crucial, especially within the context of environmental factors that investors look for in companies to contribute to money. The realm of environmental factors focuses on the impact that a company will have on the environment, such as its carbon footprint, waste, water use and conservation, and clean technology.

Growing Investment Opportunities

Furthermore, this marketplace for sustainable investing is only growing. The United States’ Forum for Sustainable and Responsible Investment identified $17.1 trillion in total assets under management at the end of 2019 using one or more sustainable investing strategies, a 42 percent increase from the $12.0 trillion identified two years prior (“Sustainable Investing Basics,” USSIF). This type of investing has become more desirable because “investors do not have to pay more to align their investments with their values, or to avoid companies with poor environmental, social or governance practices” (“Sustainable Investing Basics,” USSIF). Therefore, with sustainable investing, investors can propagate social impact without losing money. As a whole, sustainable investing is important because it can help contribute to vast infrastructure changes needed in our society to tackle the challenges we face. It allows us to move towards a better and more sustainable future.

KorePartner Spotlight: Jonathan Stidd, Co-Founder and CEO of Ridge Growth Agency

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem. 

During the capital raising journey, many components must be in place to increase the potential for success. One of these critical factors is ensuring that a raise is marketed to get an issuer’s message in the right place to get in front of the right eyes. 

Ridge Growth Agency is an expert in equity crowdfunding and direct-to-consumer marketing, dedicated to building the brands of tomorrow. The company positions brands to introduce them to new, high-value customers and investors. When the company started, it was first a digital marketing agency that helped eCommerce brands scale online. Jonathan Stidd said, “When we got introduced to equity crowdfunding, we quickly realized we could apply these same tactics to acquiring investors online.” Since introducing this service, the agency has helped its clients raise over $330 million through Regulation A+ offerings. 

Ridge Growth Agency provides a wide range of digital marketing services for its clients. These include website design and development; newsletter and sponsored content creation; paid media management; budgeting, planning, and forecasting; video production and editing; graphic design; copywriting; and email marketing. Jonathan feels this is what sets them apart from other firms offering similar services, saying, “nobody seems to offer [them all].”

After receiving his education in economics, Jonathan himself entered into this field and has since developed expertise in management consulting, venture capital, entrepreneurship, and the growth strategies to launch and scale brands. He feels passionate about this industry because of the ability to “help cutting-edge companies raise capital in a relatively new way!” Additionally, he feels that a partnership with KoreConX was just the right fit. He said: “as a technology provider for the pipe system of these raises, KoreConX is a crucial tool to move the investors through the funnel.”

Why Digital Marketing is The Key to “Always Raising” Capital

In a recent webinar with StartEngine, Kevin O’Leary succinctly said, “great companies that are growing need money, and they should get it.”

 

With today’s unparalleled changes, raising capital in many ways is much easier said than done. Many great ideas are having a uniquely difficult time raising the money to fuel their vision.

 

Radical economic change due to COVID vastly disrupted the venture capital markets by 57%—a start-up’s traditional source of funding.

 

Rather than making new investments, Kevin summed, “venture capital firms are focused on making life and death decisions within their own portfolio.” Which means venture opportunity is sparse, and entrepreneurs are left wondering, “where can I turn for funding?”

 

The good news is there’s a silver lining and it’s called equity crowdfunding.

Traditional Venture Capital is Shifting Towards Online Equity Crowdfunding Platforms

 

Equity crowdfunding, or selling small shares of a company to the everyday (non-accredited) investor started not too long ago when the Title III section of the JOBS Act was passed in 2017.

 

Now, when venture capital is failing, more entrepreneurs are looking to the crowd of the everyday investors to fund their business in exchange for offerings like promissory notes, convertible notes, SAFE agreements, and revenue shares.

 

Everyday investors can invest in businesses through one of many equity crowdfunding platforms such as Wefunder, StartEngine, and MicroVentures. Since the platforms and investors are solely online, it means that businesses must have a strong online presence and digital marketing plan to meet their raise goals.

 

It means a brand trying to disrupt the market with a game-changing idea, must have an equally innovative online marketing strategy. For instance, say you’re trying to raise the full Reg CF cap of one million dollars when on average an everyday investor invests a minimum of $150 into your company. You’ll need to be backed by 6,667 investors.

 

But the real question is how do I drive awareness and attract the number of investors in the first place?

 

That’s where digital marketing comes in.

 

Digital Marketing Lets You Tap Into the Growing Everyday Investor Community

 

Most entrepreneurs make the mistake of believing that if they post a raise video, write engaging copy, post an interesting graphic, and that the investors will flood in from the crowdfunding platform. Wrong.

 

As an expert in digital marketing for crowdfunding campaigns, I see this mindset often. When entrepreneurs ask why their equity crowdfunding campaign failed, the answer is always the same—the offering was not marketed enough and the brand did not have a strong enough presence online.

 

Digital marketing mitigates both and helps drive accredited and everyday investors to their raise page with proper testing, optimation, and scaling.

Because here’s the thing:

 

Equity crowdfunding platforms are digitally native, which means new everyday investors that are not a part of your existing network or family, must be found online. Thus, failing to target and nurture an online audience with a closely managed digital marketing strategy is not only failing to plan, but it’s also planning to fail.

 

Accredited Investors Want to See a Strong Digital Marketing Strategy

 

The beauty of equity crowdfunding is that any campaign can still pique the interest of accredited investors and inspire them to fund you. We all know that a single large investment can take your campaign to the next level, thus it’s paramount to make your campaign as attractive as possible to them.

 

One of the best ways to do so is to show a strong digital marketing strategy that drives investor interest and audience growth. Your marketing strategy not only shows investors why you’ll succeed, but also highlights your ability to find, capture, and convert your target audience.

 
 

Digital Marketing Can Turn $1K into $1M During an Equity Crowdfunding Campaign

 

As more of the world log online to cope with the new norm and as venture capital slowly recovers, private investing is dramatically shifting

 

Equity crowdfunding is in the spotlight, giving everyday people the power to invest in potentially the next Uber or Instagram but also back the problems they’re passionate about—all while helping entrepreneurs keep their business growing and their dreams alive.

 
 

If equity crowdfunding is the door to always raising capital through and beyond this pandemic, then digital marketing is the key.

 

With its native abilities to connect people, build trust, and tell stories, digital marketing is uniquely positioned to help any start-up looking to scale, find new users and investors from around the world.

 

Thus, digital marketing is an essential part of your campaign, and it’s important to work with the right professionals who know how to create the right strategy, target the right investors, and find the right message.

 

Remember, turning on some ads and writing a few blog posts won’t cut it. Scaling your business with digital marketing takes time, constant testing, monitoring, and creativity. From experience we can’t emphasize enough that you start early in your campaign, don’t give up, and always be raising

KorePartner Spotlight: Paul Karrlsson-Willis, CEO of JUSTLY

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem. 

 

Paul Karrlsson-Willis is the CEO of JUSTLY, a registered broker-dealer designed for companies to promote their ESG profiles as the demand for socially conscious businesses continues to skyrocket. Nearly a quarter of the $400 billion investments ESG-focused private capital between 2015 and 2020 was invested last year alone. Paul has over 30 years of experience in financial services businesses and has expertise in building out a company’s global footprint.

 

We took some time to speak with Paul to learn more about himself and his firm. Here’s what he had to say. 

 

Why did you become involved in this industry?  

 

When I left school there was major unemployment in the UK so the government came up with the “youth opportunity scheme” which was an intern program at various companies which the government-funded. I was fortunate to be accepted into this program by the London Stock Exchange who placed me with a broker-dealer, Capel-Cure Myers, and never looked back.

 

What services does your company provide for RegA+ offerings? 

 

We can offer everything from front to back for Reg A+, Reg CF, and Reg. D as a result of having great partners such as KoreConX. Our true value is in our ability to work with the issuers and understand their businesses and needs. Our parent company–Ideanomics (NASDAQ: IDEX)–started no different from the issuers we support and still invests in private equity companies. It’s in our DNA.  

 

What are your unique areas of expertise? 

 

Over my 30+ career, I have continually been given various businesses, products, and groups to build or rejuvenate, many have gone on to be leaders in their space. A good example was when Fidelity hired me in the UK to build a global trading product for their retail clients base, knowing I had no experience in foreign equities and this was after 3 previous attempts had failed. We were up and running in 3 months and when they asked me to come to the US to do the same, the UK business was profitable. At Fidelity Capital Markets (US) we went from being only able to do everything in USD, to being fully multi-currency, able to trade in over 47 countries in real-time. As a result, Fidelity retail was the first retail US broker-dealer to offer global trading in real-time. I’ve been very fortunate to have worked my way up through the business and therefore know how things get from A to Z and the issues you will come across.  I love to learn; I hate being the smartest person in the room, which is why I try to make sure I have a team that is knowledgeable and feels empowered. I’m very passionate and treat everything I build as part of me, as I believe it reflects on me personally.

 

What excites you about this industry? 

 

Up until now, not very much. It’s been a job I have always put more than 100% into to support my wonderful family. JUSTLY has given me the ability to build something that can genuinely make an impact and help others. Every day, I think about making a difference and not feeding the machine or massaging someone’s ego. Don’t get me wrong, my job is to generate revenue and make JUSTLY profitable, but by making that difference, we will as they go hand-in-hand.

 

How is a partnership with KoreConX the right fit for your company?  

 

KoreConX has the complete platform, amazing expertise and therefore enables JUSTLY to focus on making an IMPACT! True success is never achieved on your own; you need a team and great partners. There is no better partner in this space than KoreConX.

 

How KoreChain Helps Companies Raise Capital Compliantly

Recently, KoreConX’s CEO Oscar Jofre was a guest on Fintech.TV’s Digital Asset Report to discuss the KoreChain Infrastructure. Watch the full video on YouTube.

 

What is KoreChain?

The KoreChain infrastructure is a blockchain technology that can be leveraged by companies qualified with the SEC to help them raise capital. It is the first fully SEC-compliant blockchain technology to connect broker-dealers, investors, companies, secondary market alternative trading systems, banking whales,  and all stakeholders in private capital markets.

 

KoreChain overview:

  • KoreChain is a permissioned blockchain.
  • KoreChain is built on enterprise-class industrial-strength hyper ledger fabric.
  • KoreChain is safe and secure: hosted on IBMs servers with the highest level of security (FIPS 140-2 level 4).
  • KoreChain is wholly focused on tokenized securities for global private capital markets. 

 

The technology enables a roadmap that others can adopt as long as they go through the qualification process to create fully SEC-compliant stable coins, NFTs, or other blockchain offerings. By being fully SEC-compliant, KoreChain offered by KoreConX is putting best practices forward, supplying the industry with standardization about market infrastructure, regulation, and how the latest and best technology can collaborate for the best outcome.

 

Why Utilize KoreChain?

The new SEC commissioner is not against cryptocurrencies; instead, he wants these offerings to utilize regulations instead of accessing these technologies through the side or back door. Using SEC regulations provides efficiency, transparency, and secondary liquidity, particularly helpful in private markets. The KoreChain technology allows you to offer all of this when creating assets on the blockchain.

 

The characters that differentiate KoreChain from other blockchains are: 

  • Permissioned 
  • Governed (including separate audit chain)
  • Complete lifecycle management of contracts
  • Event management
  • Artificial Intelligience 
  • Modular
  • APIs that integrate with the ecosystem

 

The KoreChain is the first fully SEC-compliant blockchain that meets regulations, encouraging understanding of SEC rules, regulations, and participants. The blockchain provides added confidence, so those using blockchain technologies find the process more efficient, from the investor to everyone involved. The KoreChain is a transparent solution that shortens the cycle of creation for anyone involved because investors can follow a fully SEC-compliant playbook through the entire process. 

Things to Consider When Choosing Your Equity Crowdfunding Portal

Written by KorePartner Jason Fishman at DNA. See the original post here.

 

Before the new SEC regulations, about 20% of Reg CF campaigns hit the seven-figure level. In other words, most campaigns simply do not achieve their full cap.

They’re are many reasons why campaigns don’t hit the max, and many would sum it up to lack of marketing and business development.

However, many people don’t consider the portal themselves. Sometimes a portal and issuer don’t fit, and I’ve seen campaigns that were underperforming on one portal, achieve high success on another.

 

Thus, picking the right portal for your campaign is an extremely important component of your raise. While DNA can not advise you which portal will best suit your needs, we can give you some tips and our top five things to consider when choosing your equity crowdfunding portal.

 

So, we should explore anything you can do to set yourself up for a win and within the desired period. This is a critical component of your round.

Investor Audience Size

One benefit of using a filing with a portal is to leverage their existing investor audience. Typically as campaigns raise more, the portal’s audience takes more notice, and are more are likely to invest.

From firsthand experience, I can say that as portal technology and user experience improves, the larger these investor communities are growing. Pick a portal with a large, engaged, and active audience. Don’t forget to ask the portal how they leverage their audience during the course of your campaign for more success.

Vertical Focuses

As equity crowdfunding grows in popularity, more and more portals are emerging, dedicated to a specific focus. For example, Bioverge, is specifically tailored to healthcare startups, while Waterworks, is geared towards technologies advancing water solutions.

Not only do these platforms attract a very specific and engaged industry audience in that industry, but they typically have an experienced team that has a strong portfolio of niche-specific deals, and understands the nuances around their specific area of focus. If a platform can show a list of campaigns they have done successfully in that industry and have a high volume of investors attached to it, they will be valuable resources for an issuer.

A niche-specific could be a great option for your campaign, however take into consideration many are still in development and growing compared to the more-established and well known portals.

Success Rates

The data you need is out there.

I highly recommend starting at KingsCrowd, as most of their information is available for free or a very light subscription fee. On KingsCrowd you can do due diligence on each portal and their success rates.

You can also look at their analyst reports to see top deals, deals for an industry, deals per portal, and how much they have raised. Set a benchmark for yourself, and note which campaigns and platforms hit your benchmarks.

You may find that the volume of campaigns these portals have taken on has dropped in the past months, especially when you are looking at entry-level or mid-tier portals. You may find that it has skyrocketed. How many campaigns are below or above a milestone level may also stand out to you.

The numbers don’t lie. Take in as much data as you can to see how successful campaigns are currently doing on their platform.

Customer Service

Equity crowdfunding campaigns have a lot of ups and downs, and when your campaign isn’t performing you have to rely on your portals team to support and provide white-glove customer service..

You can get a sense of what the experience will be during your meet and greet. I recommend asking the following questions and paying attention to the working experience:

  • Who will be your day-to-day point of contact is?

  • What does the working process together look like during the pre-stages of your live campaign?

  • How do you optimize when things are not going according to plan?

  • Is the portal going to disappear and be afraid to talk to you?

  • Are they going to come to the table with constructive recommendations?

  • Is there anything they can do to go the extra mile among promotions to their existing audience?

  • When the campaign is going according to plan and ramping up at speed, how can you scale and get there quicker?

  • What will their partnership with you look like at those stages?

 

I would also recommend speaking to three or more portals, and look to intuition about who is committed to your deal and confident in the success of it among their investor audience on their platform.

Added Value

This is a bit of a controversial topic because the SEC requires portals to treat each issuer the same. But they have different benchmarks that once you hit the increments of capital funding, they promote you to their email audience.

But if any groups show so much confidence in your deal that they will bring more to the table, I would note that in the review process. Some of these things include:

  • Private investor groups

  • Special placement on the site

  • Additional promotions

  • Introductions to different accelerators or different VC groups that back the deal beforehand

  • Introductions to various types of angel investors, strategic partners, industry experts, and more

 

However, I would not shape my selection merely on this factor, but be cognizant of it. Crowdfunding is essentially a team sport that occurs within a small window of time. The more resources you bring to the table, the better.

So, if there is any portal giving you additional value beyond their standard package because of how they envision it equating to your success, it could be a factor in your decision-making process.

Pick Your Portal Carefully!

Listing your deal will not ensure ANY results.

Setting up and managing a successful campaign takes careful planning and forethought, especially when it comes to picking your portal. Having a strong understanding of the top portals available is going to be an educational and helpful process across the board.

Here are some of the top portals available for you to consider:

 

 

You may get tips from one portal that you apply to another, and it is important to become part of the entire equity crowdfunding ecosystem rather than selecting a partner and move on. These relationships continue, so I encourage you to map out what a relationship could look like with each portal, and nurture it.

Meet the KorePartners: Adrian Alvarez, CEO and Co-Founder of InvestReady

With the recent launch of the KoreConX all-in-one RegA+ platform, KoreConX is happy to feature the partners that contribute to its ecosystem.

For the last seven years, Adrian Alvarez has been involved in the securities space, coming to know it like the back of his hand. He has received both his law degree and a Master’s in Business Administration.

Before InvestReady, Adrian Alvarez was the Assistant Director at the University of Miami’s launchpad program, consulting early-stage businesses and entrepreneurs. During this time, he grew very attuned to crowdfunding as became incorporated into the JOBS Act. As crowdfunding platforms emerged, Adrian noticed both potential problems and opportunities in the space. Being an attorney, he felt like he could solve some of these challenges, which lead to InvestReady.

As investments have become increasingly digitals, issuers needed a verification tool to match. With InvestReady, investors can securely and confidentially verify their identity so they can invest in crowdfunding offerings. Issuers and funding platforms are empowered by a tool that makes this processes secure and seamless. The result is SEC-compliant crowdfunding investors.

Ensuring investors meet requirements as crowdfunding continues to evolve. Just this year, the SEC increased investment limits for Regulation A+ and Regulation CF, allowing even more investors to participate in each offering. Plus, as RegCF removes accredited investor limits, ensuring these investors meet the requirements of accredited investors is essential.

Adrian has felt that working with KoreConX has been a great partnership, as it helps to bridge to other service providers like broker-dealers.

Meet the KorePartners: Eric Fischgrund of FischTank PR

With the recent launch of the KoreConX all-in-one RegA+ platform, KoreConX is happy to feature the partners that contribute to its ecosystem. 

 

For nearly 15 years, Eric Fischgrund has been involved in the communications and marketing industry. He says: “ I have a degree in Communications Journalism and have always been a writer at heart, so public relations was a natural career match for me.” Continuing to learn every day from his clients has always enticed him to continue in his career path, as “constantly learning client subject matter and determining how to deliver their message to the market, provides me with an ongoing (and free!) education.” He prides himself on his ability to understand his clients’ businesses and apply a unique skill set to achieve results.

 

Passionate about both the public relations industry and investment space, Eric is excited about the future and the opportunities it will bring for both companies and investors. He says: “Entrepreneurs need capital and main street investors deserve high growth opportunities, so this is two birds and one stone. I also enjoy working in emerging industries, such as sustainability, renewables, cleantech, IIoT and IoT, healthcare tech, cannabis, and others. So many innovators in these sectors are utilizing equity crowdfunding to grow their business.” 

 

Through the introduction of RegA+, companies have access to a fundraising route that is favorable to small startups as well and allows a wider pool of investors access to high-growth investment opportunities. Eric says: “Historically, it’s taken significant capital, legal costs, marketing and communications requirements, and more to raise capital. Similarly, the venture capitalists, private equity firms and individual high net worth investors are the ones presented with the highest growth investment opportunities.” RegA+ levels the playing field, eliminating these problems. “It enables entrepreneurs to raise capital online, grow their brand simultaneously,” while allowing main street investors to make investments for as low as a few hundred or thousand dollars. 

 

Despite the incredible opportunity RegA+ presents, Eric feels that there is much misinformation circulating about how to raise capital. He says: “Professionals that don’t understand the nuances of the regulation can too easily take advantage of entrepreneurs, innovators, and investors, which hurts all of us. This is why I’m encouraged by the KoreConX platform bringing the experts together.” Establishing a partnership with KoreConX was a perfect fit, as FischTank works to partner with strong businesses and companies. “We also strive to make the world a better place, and many of the innovators and companies we work with are developing technologies and services that do just that,” Eric said.

 

For companies that are looking to raise capital, working with a PR agency is important for their success. When potential investors are looking to learn more about a company they have an interest in investing in, one of the first things they will do is Google it. “If there is plenty of editorial search results, especially on the first page, and constant news, the company is going to appear credible and appealing,” Eric said. Additionally, effective PR can also be utilized from a marketing perspective. “Press coverage not only attracts attention but it can be used as sales/marketing tools for investor outreach and relations functions.” At FischTank, they provide a wide variety of public relations and marketing services to their clients. They take care of media and press coverage, email marketing, social media, and content writing so that you can raise capital effectively and successfully. 

 

KorePartner Spotlight: Bill Humphrey, CEO and Co-Founder of New Direction Trust Company

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem. 

 

Bill Humphrey has over 20 years of experience as a CPA, focusing his career on income tax, auditing, tax-related real estate issues, and forensic accounting. In 2003, Bill and Catherine Wynne began New Direction IRA to offer a service-based solution for self-directed investors to diversify their retirement portfolios. Fifteen years later, New Direction IRA became New Direction Trust Company.

 

Under traditional securities firms, Bill noticed that investors could only make investments on Wall Street but didn’t agree with that idea. Instead, he believed that people should have the opportunity to invest in something they understand, they just needed a custodian. Bill has a passion for education and empowering his clients to invest in what they want. He is driven to make self-direction intuitive, modern, and digitally powered.

 

At New Direction Trust Company, the firm acts as a custodian for IRAs, HSAs, and 401K accounts. These types of plans are uniquely suited for investments; there is more money in an IRA than in the pockets of the account holders. Through Regulation A+, investors can use IRAs to make investments in private offerings, creating more opportunities for people to invest. Such opportunities allow investments in companies that may evolve into large companies. Traditionally, these opportunities were only available to accredited investors, leaving the retail investors out of the significant return of an IPO.

 

The firm places a large emphasis on automating the processes of making these investments. Historically, paperwork has been slow and unattractive to investors. Instead, the experience should be similar to investing on Wall Street. This is one of the reasons a partnership with KoreConX makes sense; both companies are aimed at many of the same things. KoreConX and New Direction Trust Company are committed to making private investment transact smoothly and through automated processes.

Join the new American Revolution – financial markets equality for all

This post originally appeared on the Rialto Markets blog and was written by Lee E. Saba, Head of Market Structure at Rialto Markets.

 

Very few people understand the revolution now taking place in financial markets.

It is to do with private markets and has been sparked by new regulations allowing investment and trading access to the masses.

For the first time, you and me, mom and pop, can invest in early-stage companies once exclusive to the elite investor. You know the investors I refer to: those with deep pockets that always seem to get in early, make a fortune when the company goes public, then exit the position as fast as possible to lock in significant gains.

Well, those days my friends are now a thing of the past.

Access to the best private company offerings

Retail investors now have access to some of the best private companies available at the early stage. Imagine investing in Tesla, Amazon or Coinbase before they listed on the “big” boards like the NYSE and Nasdaq, you know, during that high growth period where the real money can be made.

Accessing private markets is not in any way a guarantee for future gains however, because everyone who can pass anti-money-laundering (AML) and know your client (KYC) can get access to these companies now.

Hundreds of thousands private investors are joining the crowdfunding revolution

But how did we get this much wider access? It’s due to the JOBS Act of 2012 creating two new ways for private companies to raise money – Regulation A+ and Regulation CF (CF is short for crowd funding).

These two new rules (or exemptions as they are formally known) allow private companies to raise up to $75 million via Regulation A+ or up to $5 million via Regulation CF.

And anyone can invest in them. You no longer have to be a high-net-worth investor to get access – you can just be you. It’s a revolutionary development now gaining rapid adoption across the private markets’ landscape, allowing everyday citizens and traditional large financial institutions to invest side by side.

Gaining access to these previously inaccessible assets is a huge step in the right direction, but there is one more exciting angle to these assets. Drum roll, please….

Secondary Market for RegA+

Secondary markets mean if you bought a private placement security, say a Regulation A+, in the primary market (when the private company is open to outside investors) and want more of it or need the money you originally invested to pay off student loans or put a down payment on a home, you can now monetize that investment and get your money well before the company sells or goes public.

And there is an SEC regulated marketplace to buy and sell private placement securities. This means investors in private securities have a government regulator looking out for them, not some fly-by-night unregulated crypto operation run by novice entrepreneurs but a full-blown marketplace to match any buyers to the sellers and any sellers to the buyers.

This regulated matching facility is called an ATS (Alternative Trading System) and the professional investors on Wall Street have used these for years to get the best price and least amount of market impact as possible. But now anyone can access the world of private placements through a regulated ATS like ours at Rialto Markets.

Rialto’s team has built numerous Alternative Trading Systems in the traditional capital markets arena and has now leveraged that huge experience to launch its new ATS for private securities, enabling all investors – from retail to high end institutions – to participate in secondary markets for private securities.

Secondary trading for private securities? Yup. It’s a whole new and brave new world.

KorePartner Spotlight: Scott Allen, CEO of InvestAcq

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem. 

Scott Allen is the CEO of InvestAcq, a firm of investor acquisition specialists. For companies looking to raise capital in the private markets, InvestAcq identifies the best potential investors for RegA+, RegCF, and RegD 506(c) raises to effectively target investors and attract them to the offering. The firm’s specialty is working with companies in the medical industry, such as biotech, medtech, pharma, and life sciences, or those who intend to use RegA+. 

We took some time to speak with Scott to learn more about himself and his firm. Here’s what he had to say. 

 

Q: Why did you become involved in this industry?

 

A: I’ve worked in and with startups and entrepreneurs most of my career. I believe in entrepreneurship—it’s the lifeblood of our economy. And I know startups need access to capital. I’ve seen the downsides of the whole cycle: insufficient capital, insurmountable debt, VCs taking control of companies, spectacular IPOs that went bust within a year.

So when my long-time friend, client, and collaborator Stephen Brock, founder of Medical Funding Professionals, told me about Regulation A+ and his vision for bringing it to the medical innovation sector, I was in. It addresses perhaps the biggest need, in probably the highest impact industry. What could be better than helping put money to good use saving lives and improving quality of life?

 

Q: What services does your company provide for RegA offerings?

 

A: We are investor acquisition specialists. We use the latest marketing techniques to help companies find the best potential investors for your offering, effectively tell them your story, and make it as easy as possible for them to invest.

Our company offers a complete multi-channel integrated marketing solution, including marketing strategy, web design, email marketing, content marketing, social media, digital advertising, public relations, and investor relations. We particularly focus on the idea of “Sell the story, not the stock” — we see strong brand marketing as the foundation of everything else. Research shows that strong brands achieve a higher return on ad spend and ultimately higher market caps. In a Regulation A+ offering, telling the company’s story well attracts the investors you want—impact investors who believe in your vision and will become advocates for your business.

 

Q: What are your unique areas of expertise?

 

A: One thing that’s unique to our firm is our experience in the healthcare sector. In addition to the SEC and other regulatory compliance issues, we also have to deal with FDA regulations and guidelines. While compliance is still ultimately up to the issuer and their attorneys, having a communications team that’s experienced in those issues reduces a lot of back-and-forths, and really speeds up the process. We even occasionally catch things that the attorneys miss, so having another set of experienced eyes on that content adds an extra layer of protection.

Personally, I have over 25 years of experience in digital marketing and several more in traditional marketing before that. While I have a broad range of experience, my unique area of expertise is social media, and more broadly, virtual business relationships. I got into social media in 2002, before it was even called social media. I co-authored the first book on social media marketing, The Virtual Handshake: Opening Doors and Closing Deals Online, and have trained or consulted with hundreds of clients over the past 19 years.

 

Q: What excites you about this industry?

 

A: Five things:

1. Getting capital in the hands of people with products that can impact people’s lives and change the world. They can only have that big impact if they can get the money they need to complete their research and development, go to market, and scale.

2. Helping those innovators stay in control of their company so they can execute their vision.

3. Making sure those founders, early investors, and early hires reap fair rewards for their vision and efforts. To me, late money should never be as valuable as early sweat.

4. Helping CEOs stay focused on executing their business plan. With traditional angel / VC / private equity, the CEO basically has to take 6 months to a year away from their company to focus on fundraising. “Run your raise, or run your company. You can’t do both.” A typical VC round requires 100+ investor meetings, on average, plus countless hours of due diligence, emails, and other support. With Reg A+, much of the activity is shifted to an investor acquisition firm like us. And much of the time the CEO spends is leveraged — one webinar to hundreds of potential investors, one video that lasts for months and every potential investor will see — not hundreds of one-on-one meetings.

5. Reg A+ is good for investors. GREAT for investors. We believe everyone should be able to invest in early-stage and growth-stage companies. Until recently, most people could only invest in companies listed on the public stock exchanges. Main Street investors couldn’t get in on IPOs. Now nearly any investor can get in on innovative companies before they go public. It’s your money—you should be able to invest it where and how you want—have an impact on the world with how you choose to invest.

 

Q: How is a partnership with KoreConX the right fit for your company?

 

A: KoreConX is the industry leader for private market fintech. It’s been years in development and has more real-world testing than any other solution.

Also, as a marketer, I love the fact that KoreConX allows us to control the investor relationship from start to finish. We have visibility into every step of the process that you don’t get on the equity crowdfunding platforms.

Most of all, though, KoreConX has been an enthusiastically proactive partner; joining us for sales calls, building custom branded demos for our prospects, promoting us through the partner program, and even working with us to put on a KoreSummit focused on our industry niche.

 

Watch Scott’s KoreSummit panel on Investor Acquisition in Medtech and Life Sciences here.

 

KorePartner Spotlight: Stephen Brock, CEO of Medical Funding Professionals

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem.

 

There are two things that Stephen Brock is incredibly passionate about in the business world; gaining access to capital for innovative companies to make their products for the benefit of patients in the world and making sure that those company’s founders, early employees, and investors retain control. If that seems like a tough challenge, you have not met Stephen. What he said in an interview with Yahoo News was that “if we truly want to support innovation, let’s make sure the innovators see the just rewards for their efforts.”

 

Stephen does this by introducing companies that may not have heard of the tremendous amount of opportunity there is in the healthcare field for innovative companies using the Regulation A+ exemption under the JOBS Act. Now, companies can raise up to $75 million per year outside of the usual avenue of bank and accredited investors through Reg A+. While those in the private capital space understand this opportunity, Stephen brought something shocking to light, “80% of the people I talk to have never heard of Reg A+. And of those that have, only one or two have actually known anything about it. So, it’s on us to educate them, and that’s what we do—show them exactly what it could do for their company.”

 

This change is huge for those in the fields that require high costs to get their products to market. This, in combination with the stricter lending from the usual channels during the pandemic, makes what Stephen and his company, Medical Funding Professionals, are doing so important. They are helping innovators in the medical field bring new and life-changing technology to patients while retaining control for their technology.

 

As a registered investment advisor with over 20 years of experience in securities and finance, Stephen knows the field and is excited about the partnership with KoreConX, which has also been educating people on this powerful new financial tool.

KorePartner Spotlight: Steve Distante, Founder and Chairman of Vanderbilt Financial Group

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem.

 

Steve Distante is an entrepreneur and has been his entire life. As a graduate of St. Johns University with a degree in accounting and finance, he intimately knows their struggles and success. Before starting his own business, Steve ran an Office of Supervisory Jurisdiction (OSJ), where he learned the experience from the regulatory side. It was a great use of his degree and his intrinsic skill for planning. 

 

Steve’s journey began when his father told him to look at financial services as a career path. What he found was the rewarding business of empowering entrepreneurs to create impactful products and services for good. That is at the core of the business he founded and is the CEO, Vanderbilt Financial Group, “an investment firm disrupting traditional finance by focusing on socially and environmentally responsible, ethical, and impactful investments.” With Steve at the helm, the ship is set up to ensure that entrepreneurs do not have to go through the same struggles he did as he grew his business. 

 

As if it was not already clear that helping entrepreneurs is a driving factor in his life, Steve is also the CDO for Impact U, an educational community for students, investors, and financial advisors on impact investing. He has made two documentary films for it and is currently writing a book about Impact Investing. In addition, Steve is a former president of the Entrepreneurs’ Organization and served as the UN Ambassador for EO for nearly three years. He is very passionate about helping entrepreneurs building impactful companies with missions to better the world. 

 

Steve is thrilled about the partnership with KoreConX to streamline business processes so he can continue his excellent work for the community of entrepreneurs around the world. 

KorePartner Spotlight: Jake Gallagher, Director of Business Development at North Capital

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem.

 

Jake Gallagher has always been interested in business. He wanted to know how they worked and why some were sustainable while others were not. On top of that, the private market for company offerings has presented challenges to businesses entirely separate from those faced by public offerings.

 

This has no doubt been part of the reason he works with North Capital Private Securities as the Director, Business Development. There, he works directly with issuers and helps with transactional compliance, but beyond that is the use of RegTech to streamline broker-dealer processes like KYC (Know Your Client) and accredited investor verification. 

 

The difference that makes North Capital Private Securities and Jake unique is their work in both primary issuance and the secondary market for private market shares. Jake is well versed in both, having worked with many sectors and exemptions including, Reg A and D, VC, and hedge funds. In addition, PPEX, the ATS platform that North Capital Private Securities operates, makes trading on the secondary market easier for investors and provides options for liquidity in the private capital market.

 

The most exciting thing about the current climate of the private sector is that these options have provided for extreme growth, as more investors are ready and able to participate in the offerings of private companies. While it is a small ecosystem, the changes that have come in the last few years for who can participate in private market offerings are fueling the growth of many companies that would have otherwise been on the public market before they were ready. 

 

Jake is thrilled about the partnership with KoreConX. He anticipates they will work together on primary offerings and secondary trading, bringing together a significant experience that can only benefit all involved. 

KorePartner Spotlight: Dean DeLisle, Founder and CEO of Forward Progress

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners contributing to its ecosystem.

Dean DeLisle has been raising capital for the past 35 years both for himself and for other companies. He has made the transition from roadshows and bound pitch decks to sophisticated online marketing funnels. Dean’s experience has resulted in a unique approach to Investor Acquisition Marketing with his firm Forward Progress.

“People know they want to invest but need to understand more, so we place a high priority on education throughout our Investor Acquisition campaigns,” says Dean. Forward Progress helps clients build the necessary digital footprint to educate prospective investors in Regulation CF, Regulation A+, and Regulation D offerings. The building of the footprint requires many of the same strategic elements you would see in a revenue-focused campaign–content, thought leadership, advertising, and marketing automation.

The Forward Progress team stays at the forefront of digital marketing trends by participating as speakers on capital raising, marketing automation, and marketing strategy. The company boasts certifications with leading platforms like Hubspot CRM, Facebook Ads, Google Analytics, and more to make sure the issuers they support are at the bleeding edge.

The partnership with KoreConX makes sense for Dean, as both companies are dedicated to investor education and businesses alike. It fits with the DNA of both companies.

KorePartner Spotlight: Douglas Ruark, Founder and President of Regulation D Resources

With the recent launch of the KoreConX all-in-one RegA+ platform, KoreConX is happy to feature the partners that contribute to its ecosystem.

 

Douglas Ruark, the Founder and President of Regulation D Resources, has always been fascinated by the mechanisms and document structure used to syndicate capital. Starting his career nearly 30 years ago in corporate finance when he co-founded Heritage Finance, Inc. in 1992. Seven years later, he served as a primary founder of Regulation D Resources. The firm works primarily within the real estate, energy, tech, and manufacturing industries.

 

With Regulation D Resources, Ruark uses his expertise to help raise money for those industries through the Reg D and Reg A+ exemptions. This experience makes a difference when crafting SEC-required disclosures, evaluating proper exposure on the market, and analyzing clients’ business positions.

 

The fun part for Ruark is the deals with entrepreneurs that have developed technology that can have a significant impact and be a game-changer. He said: “I love seeing what entrepreneurs have developed.” That is why his company focuses on Reg D and Reg A+, helping companies structure their securities offering, and drafting offering documents. The company is determined to help entrepreneurs cross the line into the market so they can grow and succeed.

 

What Ruark enjoys about his partnership with KoreConX is the responsiveness of the staff. He said: “Oscar immediately reached out and set up a call to introduce services.” KoreConX has the same drive and vision that Ruark sees in other entrepreneurs. Plus, KoreConX’s application of tech to streamline compliance aligns with the goal he set out when developing Regulation D Resources’ Investor Portal Compliance Management application.

Meet the KorePartners: Louis Bevilacqua of Bevilacqua PLLC

With the recent launch of the KoreConX all-in-one RegA+ platform, KoreConX is happy to feature the partners that contribute to the ecosystem. 

 

For the past 25 years, Louis Bevilacqua has served as a corporate and securities lawyer. After spending the majority of his time at large, international law firms, Louis discovered his passion for “representing entrepreneurs and helping them accomplish their goals.” Noticing that it was often more difficult to help small or microcap companies, Louis began his firm to eliminate the prohibitive costs typically associated with large law firms. 

 

Utilizing technology to allow lawyers to work virtually, Bevilacqua’s savings are passed onto its clients. Now, small companies can access the same top-tier resources that previously only large ones may have been able to afford. “Since most of our attorneys, like me, have decades of experience at big firms, we know how deals are supposed to be done and can provide excellent representation at lower price points,” Louis said. 

 

Not only is Bevilacqua’s team comprised of experienced lawyers, but many are also entrepreneurs. Understanding first-hand the challenges that small companies face, they are experienced problem solvers that are both flexible and proactive. Also, Louis says that “we also have a vast network of contacts with investors, broker-dealers, transfer agents, Edgar printers, audit firms and other service providers in the industry and can easily make the right referrals to anyone that the company needs.”

 

Through the JOBS Act and RegA+, investors have access to investments that they may not have had previously. Since the SEC requires substantial disclosure for RegA+ offerings, investors are provided more detailed disclosures than other private offerings. Companies also benefit from the lower costs associated with RegA+. Since it is more flexible and cheaper than a traditional IPO, the cost is not prohibitive. One of the primary reasons that Louis supports the regulations is that it “helps facilitate the raising of capital for smaller issuers, who always need capital and do not have as many avenues to obtain it.”

 

However, Louis also thinks that the resale market could be improved. Currently, companies looking to allow their shares to be traded “must identify a market maker willing to file a 211 application with FINRA”, which can be a difficult process. Making this process easier will allow more people to trade the shares purchased through a RegA+ offering. Additionally, for investors to deposit the shares they’ve purchased into a brokerage account, they typically must incur the fees associated, as the brokerage is generally required to perform their due diligence. 

 

For companies looking to raise money through RegA+, Bevilacqua provides clients with the legal services they need for a successful offering. Whether they need help “testing the waters,” filing the offering statement, drafting shareholder agreements, etc., Louis and his team provide expert guidance. Also, “ having a platform like KoreConX that brings all the components necessary to accomplish a Reg A offering in one easy to use platform is a fantastic tool to help us help entrepreneurs raise capital.” 

KorePartner Spotlight: Brian Belley, Founder and CEO of Crowdwise

With the recent launch of the KoreConX all-in-one RegA+ platform, KoreConX is happy to feature the partners that contribute to its ecosystem.

 

Brian Belley, founder and CEO of Crowdwise, has always been passionate about investing and alternative investments. By training, Brian is an aerospace engineer, but the JOBS Act represented the culmination of his interests. He took this as a great opportunity to build a platform providing a wealth of information centered around crowdfunding.

 

At Crowdwise, the primary service is free educational material for investors through courses and industry data on crowdfunding and early-stage investing. From his own experience and education on private investments, Brian understood what was most applicable to investors. The goal is to make this information easily digestible, translating data into the essentials that can be understood by new investors. Brain’s specialty lies in tech and early-stage startups, as well as analyzing industry data and trends. 

 

The private capital market is particularly existing for Brian because of the opportunities he foresees. In two to five years, the space will likely look completely different as it continues to be democratized and open to new investors. There are increasing opportunities for investors to build a diversified portfolio with broad investment types. At the same time, more investment opportunities for the everyday investor will lead to more access to capital, and new businesses will be able to come into existence because of it. 

 

Brian is excited about Crowdwise’s partnership with KoreConX, saying that it is completely about cooperation and building an ecosystem. He said: “not everyone has to be a competitor.” As more people continue to drive the private market forward, it will benefit everyone in the space, both investors and companies alike.

KoreConX CEO Oscar Jofre was Recently Interviewed on DNA Podcast

Recently, KoreConX President and CEO Oscar Jofre had the pleasure of joining Jason Fishman on the Digital Niche Agency podcast. Jason and DNA are valued KorePartners and their podcast Test. Optimize. Scale. feature actionable insight for industry leaders on how to grow and optimize brands. 

 

In this episode, Jason and Oscar discuss how he was able to test, optimize, and scale KoreConX. In addition, they discuss the growing potential of Regulation Crowdfunding (RegCF) and the impact it will have on the private capital markets. 

 

The full episode can be listened to on Spotify or YouTube

KorePartner Spotlight: Jonny Price, Vice President of Fundraising at Wefunder

With the recent launch of the KoreConX all-in-one platform, KoreConX is happy to feature the partners that contribute to its ecosystem.

 

Jonny Price has always had an interest in economic development and a passion for economic justice and equity. In his first role in the fundraising sector, he worked for a company called Kiva, which provided crowdfunded micro-loans to US entrepreneurs. With his experience as the head of Kiva US, it was a natural transition to Wefunder, where he serves as VP of Fundraising.

 

For too long, investments in private companies have been limited to only accredited investors. For the average person, their only chance to invest was once the company went public. Wefunder makes it so that private investments are not just limited to wealthy investors – through Wefunder, anyone can become an angel investor for as little as $100.

 

Jonny is excited about how this is changing the private investment space. When ordinary people can invest in brands they care about, more capital is available for founders and entrepreneurs to grow their businesses. Especially in minority and women-run businesses, there is a great disparity in access to capital. Only 1% of VC funding goes to black founders, and 3% goes to female-only founding teams. Crowdfunding helps to level the playing field tremendously.

 

Partnering with KoreConX was the right fit for Wefunder. Jonny said: “I have known Oscar for a while and am impressed with the services they offer. A number of Wefunder clients have used the platform, and had very positive things to say about the KoreConX team.”