Crowd Source Equity (or Crowd Source Funding)

Crowd-sourced funding (CSF) (also called 'equity crowd funding' or 'crowd-sourced funding of shares') is a way for start-ups and small and medium-sized companies to raise money from the public to finance their business. You can invest up to $10,000 a year in a company and in exchange you'll receive securities in the form of shares.

You can learn more about Crowd Source Funding on the Australia Securities & Investments Commission website (ASIC).

Crowd-sourced funding of shares is different from crowd funding Crowd-sourced funding of shares is different from the donation-based crowd funding typically used by artists or entrepreneurs to raise money for one-off projects.

It is also different from investment-based crowd funding, which may involve investing in a managed investment scheme or be offered by someone who does not need an Australian financial services (AFS) licence..

If you want to invest in a company offering shares through a CSF website, you will be asked to acknowledge that you have read and understood the risk warning listed on the website and in the offer document.

You can only invest up to $10,000 per company in a 12-month period, so your application will be rejected if you try to invest more than the cap.

You have a cooling-off period of 5 business days to change your mind if you decide the investment isn't for you. During this time, you can withdraw your application to invest and receive a full refund.