The Tribune

By YOURI KEMP

Tribune Business Reporter

ykemp@tribunemedia.net

Bahamian small and medium-sized enterprises (SMEs) yesterday hailed proposed crowdfunding rules that will enable them to raise up to $5m in equity capital as an “amazing boost”.

Cody Simpson, Social Cay’s owner/operator of Social Cay, told Tribune Business “this is what the country needs to move forward” and “bring on some of the younger generation”.

She spoke out after Kwasi Thompson, minister of state for finance, told the Senate earlier this week that the soon-to-be released Securities Industry Business Capital Rules will allow SMEs, start-ups and entrepreneurs to raise capital via crowdfunding.

Issuers will be able to raise up to $5m through selling shares in their ventures without having to file a prospectus with the Securities Commission. The intent is that investors will be able to sell their interest on a secondary market such as the Bahamas International Securities Exchange (BISX).

The rules are set for completion by April’s end. They will also include protections against hostile takeovers of SMEs by limiting the amount of shares any one investor will be allowed to buy in a particular company.

Ms Simpson, rejecting the fears that SMEs will be exposed to hostile takeoverst, said: “I think it is going to be fine. I’m sure they are going to have the proper protocols in place.”

Kashan Culmer, owner/operator of Poitier Marketing & PR Group, said: “I think this is a great opportunity. There are a lot of small businesses, especially those that came up as a result of the coronavirus pandemic, along with people losing their jobs and being furloughed.

“As such they started their own home businesses and other ventures. I think they would probably benefit the most from such an initiative and opportunity, especially as a lot of them are looking for investors.”

Asserting that the issuance of crowdfunding rules is “timely”, she added that start-ups and cottage industries need this to “take them over the line” by providing them with the capital to invest in labour or even taking the next step towards establishing a business physical presence.

Neville Smith, general manager of Settler’s Cove, though, was sceptical, saying: “I will be happy when I see it.”

He added: “Prime Minister Minnis said he was going to give the filmmakers $1m, and he has not given us that money yet. So all of them are full of foolishness to me. Every time they come in, they say the same thing and only a small section of The Bahamas gets anything out of it.”

Ricardo Knowles, owner/operator of Always Creative, said the crowdfunding initiative will be “great” if it comes to fruition. He added: “I think access to crowd funding is in high demand because it is difficult to try and get a small business up, so I think this is a great step forward.”