What is Symbid

Symbid in a nutshell

Symbid is the first crowd funding “equity-based” online investment platform that enables individuals to actually become partial owners of exciting new companies! Symbid offers its services to partners in a so called white label product, however Symbid will always remain the contractual partner for all crowdfunding services offered to the public. Read more about our partner program here. Symbid and all related white label portals bring together entrepreneurs and investors so they can realize the funding of new and exciting business ideas.

Investors use Symbid to discover and invest in promising business ideas that could well be the next big thing! Anyone can invest from as little as EUR 20,- for each investment opportunity up to EUR 2,500,000: you determine the size of your investments!

Entrepreneurs use Symbid as an exciting new way to obtain start or growth capital with help from the crowd:

How does it work?

Entrepreneurs

Companies and individuals submit a business idea for a new venture or a growth plan for an existing venture – which we call a “Proposition or idea”. When you register your proposition at Symbid, you indicate how much capital is required to start or grow your business. Registering an existing company on Symbid will cost you EUR 250,- (exclusive of VAT) but an entrepreneur with only a great idea and no legal entity will not be charged any registration fee. Reaching your target capital depends on the amount of funding needed, the strength of pitch and your marketing efforts. Symbid provides the means to create the ideal mix of ingredients for success!

Currently the services of Symbid are only available in the Netherlands for entrepreneurs. However Symbid aims at servicing entrepreneurs trhough out Europe and the United States very soon.

Investors (the 'Crowd')

Potential investors search for compelling propositions with promising outlooks that they believe have good chance of succeeding and generate favorable returns. Investors allocate parts of EUR 20,- each to a business idea on Symbid , investors pay for each part they buy an administration fee of 3% plus transaction costs. Parts can be purchased with all common payment methods like CreditCard, iDeal and PayPal. All the investments together make up the 'current funding'. The ultimate goal is to complete the investment requirement set by the entrepreneur. Investments can be easily managed in your (investor)portfolio, switching your parts from one idea to another is free of any charge!

Payments are secure and stored on a separate Trust bank account until the capital requirements have been reached. When the target capital is reached, transactions are secured and the contracts are executed, ensuring that investors receive their ownership certificates and entrepreneurs receive their funding. Transactions are executed only when the target capital is reached. This kicks off your exciting new business idea!

Before reaching completion of the capital goal, you can choose to withdraw your investments at any time and direct them towards an alternative proposition. This means you are always in control of your investments. Once the entrepreneurs have reached their target amount, the contract is then executed and you officially become a partial owner of the company!

Currently the services of Symbid are not accessible for investors from the United States. However Symbid aims at offering its services to investors and entreoreneurs in the United States as soon as the JOBS-act signed by President Obama on the 5th of April 2012 has been implemented by the SEC.

Investors (the 'Angels')

Every entrepreneur could use a business angel to increase the chances on success. On the platform a large number of active business angels can be found. For them the platform is an easy way of connecting with the entrepreneurs, with interesting propositions only one mouse click away. Symbid has several interesting partnerships with business angel clubs. Next to that we offer discount to business angels on the platform. Investors with more than EUR 5000,- of invested capital on the platform will be charged only 1% of administration costs.

Funding completed?

When an idea is fully funded, the individual investments are converted into a single investment vehicle; a new legal entity designed for the purposes of making the investment in the entrepreneur's venture. Each investor owns a stake in the new legal entity (the Investor Cooperative with limited liability) in the proportion of their investment to the overall investment amount. Subsequently, this new legal entity buys the predetermined amount of shares associated with the pre-determined level of funding granted to the entrepreneur. This is also the stage where Symbid will be paid the success fee of 5% (exclusive of VAT) of the total funding obtained by the entrepreneur.

Entrepreneurs and investors are offered already during the fundraising process access to their secured online collaboration community. Investors within the investor community can join forces to actively support and direct the venture towards a successful and profitable growth path. By means of various tools the entrepreneurs and investors monitor the progress of the company and interact with each other. In addition, individuals have the ability to transfer their stake in the company to other internal or external investors.

How it works in four simple steps

What are the advantages?

Why should you use Symbid

Symbid offers means for start-ups and small and medium sized enterprises to attract finance and knowledge. For investors, Symbid offers a large variation of propositions for new start-ups looking for starting capital and propositions of established companies looking for growth capital. The platform presents the propositions in a similar way, the entrepreneur decides how much information he discloses and how to present his proposition. Needless to say, the more information presented, the better a visitor can make an investment decision. Investing on the platform is a matter of a few clicks. Select the business idea you would like to invest in, click invest and select the number of parts (x €20), complete the transaction either by paying directly or use the pre-uploaded balance in your wallet. Investing just became easy!

Direct investments in equity

All investments are transferred into membership certificates with direct voting rights in the investors cooperative (but indirect voting rights into the entity of the entrepreneur), limited transferability and dividends. This does lead to a high level of involvement for the investor.

An innovative capital search tool

Symbid offers small and medium companies and start-ups access to a completely new and substantial capital market.

Low cost access to capital

Using Symbid is free for start-up entrepreneurs and investors. Existing companies pay a small fee €250,- (exclusive of VAT) for their registration. Because our services are mostly free we can offer low cost access to capital. Also we make it easy and affordable for anyone to join as a potential investor.

Safe and secure online administration

All investments are registered and processed online for optimal user convenience. This way a safe and secured environment is ensured for your investments. Entrepreneurs are in control of the information they share in their propositions and decide what information to disclose. Symbid enables propositions to be sent in the form of a secured invitation to a potential investor or to be made available to the entire community of investors registered on Symbid. It is your call!

Refund possibility to your bank account

When your preferred proposition is not reaching its target capital, and you are not willing to invest in any other idea on the platform you can have the invested amount refunded to your bank account. Refunds can be processed as long as the parts are in your wallet and not allocated to an idea. Parts can be desinvested from an idea untill the target capital has been reached.

Partners

Symbid works together with leading global partners to support entrepreneurs in every possible way and to strive for proper accounting practices and minimize risks for entrepreneurs and investors.

The legal framework

Fiscal and legal background

Symbid uses a unique framework to ensure the fiscal and legal requirements necessary to run a safe and secure online investing platform. The benefits of using our construction are the following:

» Earnings on capital gains and dividends

» Indirect voting rights in executing Dutch entity

» All transactions occur online

» Only one transaction per idea at the notary office

» Membership certificates of a cooperative are transferrable

» Financing up to EUR 2.5 million per business idea

» Money can be refunded from the wallet to the bank account

This fiscal and legal construction used by Symbid does not require a license according to the AFM (Authority Financial Markets) as well as the DNB (Dutch National Bank).

Why did we adopt the cooperative legal form in combination with crowdfunding?

A cooperative model has been chosen so that at the point when the proposition has met the Target Capital, the ‘capital’ received is transferred into a cooperative. This becomes the legal entity that invests in the entrepreneur’s venture. The advantage is that the principle foundations are very close to the principles of crowdfunding. An additional reason why we have chosen this legal form is that membership certificates in cooperatives can be easily obtained and do not have to pass by a notary.

The objectives of cooperatives in general are to ensure delivery of services or products with a group of users, to benefit from combining resources and to reach a sense of collectivity for all members. The objective of the platform is that the contribution of funds of a large group of investors provides the financial means for the entrepreneur but also helps the entrepreneur in other ways to together make the company becomes a success.

Symbid Cooperative U.A.

Visitors to the website become a member of Symbid Coöperatie UA. From that moment onwards they can pitch their idea on the platform or become an investor. Members are allowed to purchase mutliple parts of EUR 20,- which can be allocated to ideas on the platform. Our partner FEET collects all funds in a separate Trust bank account which is under supervision of the DNB and AFM as a Electronic Money Institution. FEET guarantees a 100% coverage of the funds of the members. The funds can either be transferred back to a member's bank account or to an entrepreneur if the Target Capital has been reached.

Investor Cooperative U.A.

An Investor Cooperative is established for each fully funded proposition on the platform. The Investor Cooperative U.A. is the aforementioned collective of investors. From this entity they bring their combined knowledge, network and capital into the entity of the entrepreneur. Each investor cooperative only participates in one legal entity of an entrepreneur. This means that multiple investors cooperatives can be established through the investments on the platform. The entrepreneur will transfer the agreed upon percentage of the shares of the legal entity as indicated on its idea page to the Investor Cooperative. Ultimately, each investor receives the number of membership certificates in the Investor cooperative as requested on the platform. These memberships represent the voting rights in proportion to the number of memberships that an investor owns. The memberships are transferable at any time, once authorized by the board of the Investor Cooperative. Valuation of the certificate is done by internal supply and demand.

Legal entity entrepreneur

The legal entity of the entrepreneur is where the idea will be realized, through the Investor Cooperative the investors are an indirect shareholder in this entity. At current stage we do only allow Dutch limited liability entities to raise funds on the platform. Symbid aims at providing access to international entrepreneurs very soon!

Safety and security

Symbid's model is designed to provide maximum protection for its members. Symbid has taken the utmost care designing its processes and structures to offer maximum security and confidentiality to its members. The tax and legal structure has been prepared and reviewed by professionals from highly regarded companies like BDO advisers and accountants and AKD lawyers. This legal framework serves to the interests of all stakeholders and minimize any chances of abuse.

Privacy settings

You as entrepreneur decide who views your idea. It is possible to put your plan online, where each user and visitor (and / or its partners) can see your plan, alternatively you can choose to share it only within your own network. This way only the people who you have given a unique idea-url to are able to view and invest in your idea.

State-of-the-art technology

Symbid uses the latest technology to secure and host its websites. By continuous backups of the entire system, Symbid is always capable of providing maximum protection against potential abuse or hacking of the system.

Highest possible level of security of your funds on the platform

FEET – First Electronic E-money Trust - an Electronic Money Institution (“EMI”) is defined in the Dutch Financial Supervision Act (Act on Financial Supervision) as “a financial institution that has been licensed in accordance with this Act and authorized to issue electronic money or that holds an equivalent authorisation in another country in terms of the Electronic Money Directive to issue electronic money. Electronic money (e–money) is an electronically (including magnetically) stored monetary value, represented by a claim on the issuer, which is issued on receipt of funds for the purpose of making payment transactions, and which is accepted by a person other than the electronic money issuer. Types of e-money include pre-paid cards and electronic pre-paid accounts for use online. FEET guarantees a 100% coverage of the total amount of electronic money issued.

Symbid makes use of such a license through her partner FEET EGI BV (FEET) and is therefore regulated by the local regulatory institutions such as the Dutch Central Bank and Authority Financial Markets. The license thereby allows customers to redeem any funds that they have transferred to the platform, over these refunds will be charged an administration fee. Once the Target Capital has been reached, no refund can be requested.

Symbid: pitch, tune and get funded!