Africa Financing: Crowd Funding Solutions

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Crowd Funding is an ideal tool for empowering companies with a good cause!

Packaging the value of projects in Africa both from an economics level and social impact define the appeal to using Crowd funding as a source of collective co-operation and capital by an international pool of potential investors or philanthropists.

Crowd funding has been often associated to philanthropy, giving to a cause, however the pooling of money and other resources via the internet and or as local investment pools have attracted micro-financing and equity investments to get companies off the ground and own part of businesses. In order to initiate Crowd funding, firstly the local and international laws need to appeal, as a licensed Broker Dealer, a proper strategy can be devised to fund your project legally and efficiently utilizing public relations, offering documents, and awareness.

As experts in financing, social media, internet marketing, and packaging the value of your company we funnel the activity through a proper financial house model as a hybrid of crowd funding and an offering.

The effectiveness of your crowd funding goes beyond a do it yourself financing model. There are the proper tools, regulations, and methods of promotion to achieve your goals legally.

Crowd funding is a great way to raise funds for a business, but it is not suited for all businesses. If you are interested in how crowd funding works, setting up your own crowd funding campaign, or building a community for your business through social media, contact info@financinginafrica.com and we will put you in place with our Social Media and Crowdfunding specialists.

Build a Crowd Funding Company with our Software Solution or Stock Exchange!

IFUNDX Limited, www.ifundx.com, has built a revolutionary trading system that can act as a crowdfunding system or stock exchange with various exchange levels and rules in place. What is unique, is that our system integrates the existing infrastructure of Brokers and Banks into the crowdfunding system, so that the system can be operated by a broker license or banking license as an offering platform for people with ideas that need funding and people willing to finance those ideas as investors.

IFUNDX Technologies stock exchange platform is the first global trading platform to integrate into a single platform all of the key aspects of a market. The software centralizes the role of clearing and settlement, registrar services, escrow, accounts, investors, brokers, and listed issuers or securities into one multi-functional exchange platform.

The stock exchange software is an all in one portal that covers the public visible markets, individual administrative panels for brokers, investors, escrow, registrars, and the exchange, while securing every transaction is completed and automated according to standards and compliance.

MarketExplanation

 

The Investor:

The investor joins by signing up through the internet to the online platform, supplying their KYC information and documentation, and choosing an exchange broker, or having one appointed to them. A double pin is produced, where by there is a user identification card with over 54 various PINs assigned to the user. A second card is provided with over 54 double digit pins. The two pin cards that only the investor has are capable of allowing the user to login, make trades, make transfers, request funds, etc. Therefore, any investor initiated activity is strictly secure. For example, if the investor is making an investment into a private placement, the system produces the PDF document, and they can electronically sign, only by entering in the cross reference of pins.

investorshot

Login and Security Module:

Two pin codes are supplied to each investor, one of which is a card with randomly different PINS printed. These PIN codes are unique to the investor. One card is a series of 4 digit codes, one PIN chosen by investors. To make any activity within the system that involves trading, money, communications, and or request for information, the investor must identify that they are who they say they are by entering in their personal PIN, and then a PIN from the cue card. This cue card pin randomly alternates, someone may login with the personal pin and the exact 4 digit requirement, but then to make a trade, you would be asked again to put in your personal pin and a new 4 digit pin from the card. This insures that even if someone left their computer logged in, they could not take any actions on the client account without having the PIN card. New PIN cards can be requested by investors through a series of password recovery questions and private details. However, for the ease of client and broker relationships, an investor can simply call a broker dealer on the system to make a trade if they are not technically inclined or do not have their PIN card. Therefore, the security is really for investors who would like to take online trading into their own hands.

Brokers also have a similar PIN based system of which trades cannot be done for themselves or clients without entering in the PIN for that trade, so that every individual trade is verified.

Restricted and Unrestricted

The platform has either restricted shares which investors can buy and brokers who sponsored the listing can sell, or unrestricted shares which any one can buy and sell. This goes for all products within the system. If an investor goes to a restricted product, they will see a restriction notice, and only have available the ability to buy, not to sell. If the securities are unrestricted, they can choose to sell the shares into the market. The issuer essentially has the ability to apply for the restriction to be removed from shares within the electronic trading system. All shares in a single offering are either restricted or unrestricted. One investor doesn’t get the privilege of having unrestricted shares while others are unrestricted, it is either one or the other for complete fairness and transparency. However, a company can make two offerings, one which is restricted, and one which is unrestricted. They can also place restricted and unrestricted debts, bonds, carbon credits, and contracts. The rules are essentially the same for trading.

Minimum Quantities

Based on the offering documents filed with the exchange, there may be minimum quantities, a notice will come up for investors if they have asked for less than the minimum. Therefore, in regulated areas such as Europe where 50,000 to 100,000 euro may be a minimum unit, this would stop individuals from investing less than this amount. This also greatly depends on the Broker interaction with the investors.

In the event that it is a sale of shares that falls under a new crowd funding regulation, where offerings can be done on a micro scale, this minimum could be $1 for example but maximum of $2,000. This essentially is set by the issuer or offering party. The exchange must however approve and verify the minimum quantities in interest of the investor before allowing offerings to be made.

Financials

The entire system is run on three currencies, US dollar, Great Britain Pound Sterling, and European Euro. (Potentially BitCoins in the future.) Every investor and broker have 3 bank accounts of which they can order shares from. Issuers can list in the three main currencies. If an investor has US dollars and decides to invest in Euro’s, they are prompted with a real-time currency exchange quote and asked to accept it with their double pin code combination. Clients can move funds from one currency to another real-time between these three currencies. Account holders can:

  • Transfer between accounts
  • Make a trade in one currency and agree to transfer the funds in another currency to cover the trade
  • Add funds to the designated accounts in all three currencies with unique PDF wire instructions downloadable on request for their specific account
  • Withdraw funds from the account in the currency originally deposited or to the clients account if they have one in the currency requested (transfer charges and account minimum balances do apply)
  • Trades are directly deducted from the currency account of which they are listed in, issuers take on any currency risk from foreign investors.
  • Statements can be requested via email, in pdf, or mailed to clients (subject to minimum balances and fees)

Buying and Selling Shares

In general, Venture firms will have shares that can be bought from the issuer but not sold into the market, as they would have some kind of hold or restriction. Therefore, on these companies there is a BUY but no SELL option on the screen of the company. Companies who’s shares are free for trading will have both a BUY and SELL option.

crowdfundingFUNDINGshot

Status’s of a Trade

Processing: A processing trade cannot be cancelled, this means that the resolution for issuing the shares has already been sent to the transfer agent for uploading shares into the brokerage account.

Pending: This means that the trade has not been put into processing yet, and can be cancelled until the status changes. This can be cancelled by the investor, or by the broker dealer who may not accept the trade.

A completed trade simply shows with the shares in the financial account of the client.

Information Tools

News: This is the press releases of the particular stock.

Alerts: This includes Portfolio alerts, account balance alerts, watch list, suspension alerts, financials and filing alerts, activity alerts on stocks going up or down.

Messaging: This is a tool for investors and their broker to communicate on, in addition, alerts and releases can be sent to the message system.

Groups: The groups section is for an investor to create a group of which other investors on the platform follow and possibly subscribe to by investing with the group.

Funds: This is the account balances and reload information for adding additional funds.

Settings: Within the settings section, the investor can configure their account.

Broker Section

Main Working panel for Brokers.  Once a Broker has been registered in the system and provided all documents required for compliance, a login and financial account is created.  The broker can then access all the following functions.

BrokerShot

 

Module Description Actions/Processes Access Level
Financials Financial Account details and actions, credit, debit, transfer, statements credit, debit, transfer, statements Broker with PIN
Global Position Details of all holdings, cash account etc – Shown in home currency which can be switched to EUR/USD/GBP Direct feed from European central bank for currency conversions
Clients Broker clients area Add, View, Monitor
Buy Orders Current Client buy orders Action/Process
Sell Orders Current Client Sell Orders Action/Process
Listings/Products Brokers Sponsored Listings Action/Update
Settings General Preferences area
Messaging Integrated Messaging System
Groups Group Listings Add, Join, Administrate PIN
Watchlist Current watchlist Add, Delete, Monitor
B2B Broker to Broker Transactions See Note 1 below PIN
News Feed Integrated News Feed Add, Delete, Update
Market Feed Current Market feed
Open Orders Process all open orders
New Trade Manual Input of new trade Pin
Documents Document repository View, print,

 

The broker has the following options, accept or reject order

Once order has been accepted it will be processed in accordance with the order processing module criteria described more fully below Note: All trades require the entry of the users/brokers PIN code to proceed

Buy Order Processing Module

On acceptance by the Managing Broker of an order, the following processes happen

  1. Funds are reserved from the buyers account (if there are insufficient funds available in the investors account, the trade is processed with a “Pending Funds” Status)
  2. Funds are credited to the Managing Broker (if there are sufficient funds available otherwise the trade is processed with a “Pending Funds” Status)
  3. a. If the order is a Broker2Broker transaction, A buy order is raised from the managing broker to the sponsor broker – The managing broker can set his own bid price
  1. If the order is accepted by the sponsoring broker, funds are transferred from the managing broker account into the sponsoring brokers account
  1. The system produces a Contract Note or Subscription Agreement (or other documents as programmed by the sponsoring broker at the time of listing product) and emails to all parties
  2. A full audit trail for all orders is linked to the order

Client Snapshot:

Each client has a snapshot available to the broker, including pending trades, documents, balances, uncleared funds, cleared funds, withdrawl requests, alerts, etc.

Sponsor Broker

Within the Broker section, there is the option to sponsor companies onto the exchange. If an issuer doesn’t have a sponsor, the software recommends a Broker by sending messages out with the application. Within the Sponsor section, a Broker can Add Listings, Set Broker Introduction Fees, and review the Issuer Client Snapshot.

Within the sponsor broker section, there is an Issuer Client Snapshot which includes:

  • Shareholder list
  • Pending shareholders to be given certificates or electronic shares
  • Uploaded compliance documents, such as contracts, financials, resolutions, and material events.
  • Giving and Receiving Client Notifications for compliance
  • Status which is Pending, Active (Listed), Delisted, Suspended, Halted

Broker Trading Platform:

Brokers can set the platform to auto-trade on behalf of their client, which means the client makes the trade and it automatically is placed if the funds are in the account or manual trade, which means the broker deal checks every trade and approves them manually before they are completed. For every trade in the system, the broker dealer gets a Trade Alert.

Brokers Fees and Costs

Brokers will collect fees by:

  • Charging issuers to be their sponsor broker
  • Taking a 0.5% commission for BUY trading the clients account from the 1.5% charged by the exchange.
  • Sponsor Brokers may have up to a 10% commission on the SELL trading of an Issuer’s stock of which they are the sponsor broker. In the event the BUY broker and the SELL broker are not the same broker, the sponsor broker would split their commission. However, the sponsor broker can electronically alter the commission within the system which would be advertised to the other brokers, whereby they may take 2% and give other brokers 8% or any variation of splitting the fees. This is manual change of commissions which can differ from company to company, but otherwise the default is a split commission unless otherwise altered.

Registrar Section

  • Resolutions are uploaded for the registrar to download and issue certificates from. Resolutions either say dematerialize the shares, which means to deposit them in the exchange keeping the record with the registrar, or to certificate, which means the shares are couriered to the shareholder and their account within the system is empty.
  • For shares to be sold between shareholders, there is a transfer document signed by the SELLING party, which transfers the shares to the exchange, and then the exchange transfers the shares to the BUYING party.
  • The registrar has an online copy of the shareholder list.

Escrow Section and Payroll

This is the online ledgering system that keeps track of funds coming in and out of the Bank Account, the ledgering of the funds to the issuer, broker, seller/buyer, and exchange. The Bank Account (Escrow) can login and review the full audit trail of all transactions on the exchange. From a compliance perspective, this allows Escrow to make payment, but also identify any irregularities.

Every Company, Client, and Broker sign an escrow agreement with the Bank.

 

Issuers Platform

Module Description Actions/Processes Access Level
Listings All listings, products Edit, Update
News News Feed Add, edit
Shareholders List Shareholders
Clearing Access clearing documents
Company Financials Access financial accounts credit, debit, transfer, statements, Print
Company Information Edit update company information Edit, update, Add
Open Orders Current orders relating to listings View, Reject
Company Statistics View trade history
Messaging Integrated Messaging System Read, Compose, Reply etc

 

Master Admin Platform

Investors Investor Management Approve, Reject, Edit, Suspend, View Financials
Brokers Broker Management Approve, Reject, Edit, Suspend, View Financials
Companies Company Management Approve, Reject, Edit, Suspend, , View Financials
Inbound Banking Process banking receipts Clear Funds and Post
Outbound Banking Process debit orders
Market Administer Market Add, Edit, update, suspend
Messaging Integrated Messaging System Read, Compose, Reply etc
Audit Trail/Escrow Full auditing facilities
Registrar Corporate Governance Module to insure trades are executed. Review resolutions, Confirmations of Issuances and Transfers completed

 

About the Founding Company and Why you should work with us to Launch a Crowd Funding Business

  • IFUNDX Limited was incorporated in 2013 to hold the asset of the Venture Capital Stock Exchange software designed and engineered by a consortium of advisors over 2 years
  • The software encompasses over 20 years of experience in listing companies, trading markets, and recruiting and building stock exchanges
  • The Consortium has listed over 1,000 companies on the Frankfurt Stock Exchange through partners and affiliates, over 40 UK exchange firms, over 20 US & Canadian exchange firms.
  • IFUNDX built the stock exchange software on the basis that venture exchange markets like the TSX Venture are growing globally; however, there is a gap in the market place within the African continent and global SMME market for a venture exchange for private placements.
  • IFUNDX believes that within the AfricanX Exchange over 100 companies could be listed per month.
  • IFUNDX as an International Exchange believes that it can list over 100 companies internationally per month
  • IFUNDX investor project “SOPHISTICATED INVESTOR REGISTRAR” currently has 4500 investor members where by over 200 are high-networth certified members, and the others are self-certified sophisticated investors
  • IFUNDX as a member of Dealflow Media has access to 4000 Venture Capital firms globally
  • IFUNDX as a RainMaker Member at MergerNetworks has access to over 12,000 companies looking to raise capital globally
  • IFUNDX as a member of AngelNetworks has access to over 40,000 companies and investors as partners
  • IFUNDX has a network of over 1000 websites that have over 2 million monthly visitors
  • IFUNDX will joint venture with your firm to launch the platform
  • With a large network of Broker Dealers, Banks, Registrars, and Corporations, the IFUNDX system will act as the perfect venture capital market to feed companies into the markets or crowdfunding system you want to built within your country!

Contact info@IFUNDX.com today to discuss building a stock exchange platform or “crowd funding platform for your Country or projects.

Most Popular uses of the software:

  • Green Technology Crowdfunding
  • Women Only Crowd funding businesses
  • Youth Crowdfunding solutions
  • Africa Crowdfunding Solutions
  • SMME Crowdfunding or SME Crowd Funding
  • Economic Development Funding using Crowd Funding
  • Crowd Funding Business Globally
  • Crowd Funding in Europe
  • Crowd Funding in Asia
  • Stock Exchange Software
  • Private Placement Stock Exchange Software
  • For Banks and stock brokers who want to make a private exchange using their license

Contact info@ifundx.com or go to www.ifundx.com now!

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