Parliament to consider crowdfunding

Legal barriers to alternative funding sources for small businesses could be removed

Members of parliament have proposed removing legal barriers to equity crowd funding and allowing startups and entrepreneurs to take advantage of the alternative funding arrangement, whereby crowd investors acquire a small equity stake in the company. If the proposal is adopted, parliament would remove the legal obstacles and recognise crowd funding as a reputable and viable form of finance.

Parliament member Jakob Engel-Schmidt, a former head of the Danish Entrepreneur Association, is the driving force behind opening up equity crowd funding in Denmark.

“Danish banks are reluctant to provide risk capital,” Engel-Schmidt told trendsoline.dk. “Danish entrepreneurs cannot find the capital to realise their ideas. The government needs to allow crowd funding as a form of financing in Denmark.”

Forced to find funds outside of the country
Engel-Schmidt said that it was absurd that Danish entrepreneurs are forced to seek financing from Sweden and England. 

“It is ridiculous that entrepreneurs need to raise funds abroad and I find it hard to understand why anyone would be opposed to a proposal that would create jobs and growth in Denmark”

Read more: Expat filmmaker turns to crowdfunding and pig masks

Rewards-based crowd funding, where businesses give some type of incentive for participating, is already legal in Denmark.




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