New services for investors and companies: Fiduciary and SVP

New services for investors and companies: Fiduciary and SVP

21 December 2023

MAMACROW

FIDUCIARIA

SVP

EQUITY CROWDFUNDING

STARTUP

PMI

Equity crowdfunding is an innovative means through which investors can become partners in companies and real estate projects. Mamacrowd, a leading platform in this area, has introduced new services for raising companies to improve the investor experience and provide greater flexibility in investment transactions. Prominent among these are the unit trust header service and the Special Purpose Vehicle (SVP). Let's look in more detail at what we are talking about.

The Fiduciary Header Service

The Fiduciary Unit Header Service allows the Mamacrowd investor to acquire units or shares of an innovative company through a trust company, rather than directly in his or her own name. In order to offer this service, Mamacrowd has selected Be Trust Fiduciaria S.r.l., which is authorized and supervised by the Ministry of Enterprise and Made in Italy (MIMIT), as its trustee.

The shares or units acquired by the investor are formally registered in the name of the trustee, while the beneficial ownership and related rights remain with the investor, who then retains the holdings as a separate asset from that of the trustee itself. Be Trust Fiduciary acts and intervenes in transactions legally registered under its name, but always following the directives and in the sole interest of the investor Trustee. Fiduciary header service is not provided by default for all campaigns, and activation of the service is at the discretion of the project owner company.

Special Purpose Vehicle (SVP)

SPVs, also known as special purpose vehicles, are legally independent entities specifically established by the companies being raised (Target Companies) with the sole social objective of investing the funds raised through equity crowdfunding in the target company itself. These SPVs are thus dedicated exclusively to the management of equity crowdfunding investments and represent an organized mechanism for raising them.

How does the investment work? For each campaign an investment threshold will be defined above which one invests directly in the target company, below the threshold one invests indirectly through the vehicle. It will be the latter at the end of the collection to invest the entire capital raised in the target company.

Differences between fiduciary and SVP

Although the two services have in common the sole representation of shareholders, they differ in several respects. Let's look at the main differences together:

Legal Structure

  • Fiduciary Headship Service: No new legal entity is created. The units or shares purchased by the investor are registered in the name of a licensed trust company acting on behalf of the investor
  • SPV: This is a new legal entity, often a company formed for the sole purpose of pooling equity crowdfunding investments and reinvesting them in the target company

Type of Transaction

  • Fiduciary Header Service: There is a delegation of the management of the ownership of the units or shares, but the beneficial ownership and related economic and administrative rights remain with the investor
  • SPV: Investors hold a stake in the SPV, which in turn collectively invests in the target company, acting as a single investor entity

Management and Representation

  • Fiduciary Headship Service: The trust administers the holdings and acts as the legal and fiscal representative of the investors, who nevertheless hold the economic rights
  • SPV : It is the trustee of the SPV who represents all investors and takes care of all due diligence, facilitating governance and representation to the target company

The advantages

We have talked about the differences, but what are the advantages for the investor and the collecting company from using the two services?

  • Aggregated representation: Fiduciary and SPV act as a single point of contact toward the campaigning company, enabling more efficient communication and management of corporate relationships
  • Efficient management of exits: By concentrating representation in one entity, both the trustee and the SPV can more easily manage exits
  • Administrative simplification: Both services tend to simplify the administrative management of investments, reducing the fragmentation of shareholders in the capital of the company invested in
  • Investor privacy: In both the case of the trust service and the use of an SPV, the identity of investors is not directly exposed in the view of company holdings, offering greater privacy

Overall, the fiduciary header service and SPVs represent two ways through which investors can take part in equity crowdfunding campaigns, each with its own characteristics and advantages, but both aimed at optimizing the investment experience on Mamacrowd.

Learn more about these two new features in our faq and stay up-to-date on the projects online.

Warnings pursuant to Article 19(2)
crowdfunding services provided by Mamacrowd are not covered by the Deposit Guarantee Scheme established in accordance with Directive 2014/49/EU*; securities and instruments eligible for crowdfunding purposes that can be acquired through this crowdfunding platform are not covered by the Investor Compensation Scheme established in accordance with Directive 97/9/EC**.
* Directive 2014/49/EU of the European Parliament and of the Council on Deposit Guarantee Schemes.
** Directive 97/9/EC of the European Parliament and of the Council on investor-compensation schemes.

 

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