Crowdo gets full securities crowdfunding licence
Homegrown startups are making a name for themselves. On
Monday, crowdfunding platform Crowdo reported that it has received the coveted
full licence to conduct securities crowdfunding here, while tech media platform
e27 announced that it has raised S$3 million in Series A funding.
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Jacquelyn Cheok
26 July 2016
Homegrown startups are making a name for themselves. On Monday, crowdfunding platform Crowdo reported that it has received the coveted full licence to conduct securities crowdfunding here, while tech media platform e27 announced that it has raised S$3 million in Series A funding.
Crowdo said that it had on July 18 received the Capital Market Services (CMS) licence from the Monetary Authority of Singapore (MAS) to facilitate two types of securities crowdfunding - peer-to-peer (P2P) lending and equity crowdfunding - in Singapore.
This makes Crowdo the first and only operator to achieve "multi-jurisdiction licensing" in South-east Asia, having been authorised as an equity crowdfunding operator in Malaysia by the Securities Commission Malaysia last year. Crowdo also operates a P2P-lending platform in Indonesia, and has since March processed over 600 loans with "zero defaults".
Notably, Crowdo is the third company here to be granted a CMS licence for securities crowdfunding; FundedHere and CapBridge have earlier this year been given the green light.
Crowdo chief Leo Shimada however pointed out that Crowdo is the first licensed company here to have a dedicated P2P-lending platform.
He told The Business Times: "I do not know the others' licensing conditions to have insight on which products they cover - P2P-lending or equity. But from their websites, they do not have any focused P2P-lending portfolio."
Mr Shimada added that P2P-lending players here, such as MoolahSense, Funding Societies and Capital Match, are all unlicensed. BT has learnt that all three are in the process of applying for a CMS licence.
Asked about the state of securities crowdfunding in Singapore, given recent reports of defaults and angry investors, Mr Shimada was unperturbed, citing "no lack in market opportunity" and an eventual take-off.
He said: "Defaults are a characteristic of the asset class and not unique to securities crowdfunding. Conventional bank loans have defaults as well."
To better assess risk and protect investors, Crowdo is developing a proprietary credit scoring engine using "alternative sources of data", Mr Shimada shared. "This will distinguish Crowdo from other P2P-lending platforms that are purely playing the role of matchmaker and relying on rudimentary score card methodologies."
On the new rules around securities crowdfunding that the MAS introduced in June, which include requiring platform operators to be licensed and opening up access to retail investors, Mr Shimada praised those as marking a "great first step".
"I think the challenge now will be maintaining a productive and healthy regulator-and-industry dialogue to constantly keep the MAS abreast of market developments and propose potential tweaks in the system, so that Singapore fulfils its potential as a global fintech (financial tech) hub."
Meanwhile, e27's Series A round is led by Beijing-based startup incubator TechTemple Group, and joined by China's Linear Venture, Indonesia's Convergence Ventures, Singapore's Venturecraft and Spacemob.
e27 - an online news site and marketplace for startups, which also organises offline events such as the Echelon conference series - will use the S$3 million to grow its team (of 25 employees across Singapore, Indonesia, India and the Philippines) and enhance its online product.
In particular, e27 - through its Chinese investors - is set to explore strategic partnerships with China, which has a startup ecosystem it said that can "really add value" to South-east Asia's fledgling startup ecosystems.