Equity Crowdfunding (ECF) is an innovative form of alternative fundraising that allows small businesses to raise capital from the public using online platforms registered by the Securities Commission Malaysia. To date, 10 ECF platforms have been registered. ECF allows these small businesses to offer equity in their companies to investors, who in turn invest in the idea they see potential in. With ECF, investors have the opportunity to diversify their investments beyond the traditional asset classes.
Malaysian ECF platforms have seen significant growth in line with the government’s call for financial services providers to embrace technology to develop a more inclusive, innovative and efficient capital market. As of December 2019, RM73.74 million investments was raised, with 80 successful campaigns and 77 successful issuers. The investment demographic revealed that 46% of the participants were below the age of 35 and 52% of the investment came from the retail sector.