Member Finra/SIPC 1
Disclaimer Important Information This presentation has been prepared solely for informational purposes. These materials are not an offer to sell nor a solicitation of any offer to purchase any securities described herein. This presentation and the information contained herein is proprietary and confidential and are intended exclusively for the use of the person to whom it has been delivered by Seed Equity Ventures, LLC ( Seed Equity ) and may not be reproduced or redistributed toany other person without the prior written consent. The information contained herein is subject to revision and completion and no representations or warranties are made as to the accuracy or completeness of such information. Certain of the statistcal data contained herein has been obtained from published sources and/or prepared by third parties. While such sources are believed to be reliable, none of Seed Equity or any of its affiliates, employees and representatives assume any responsibility for the accuracy of such information. This presentation may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are those that predict or describe future events or trends and that do not relate solely to past matters. For example, forwardlooking statements may predict future economic performance and describe plans and objectives for future operations. Forward-looking statements can generally be identified by the words will, believe, expect, anticipate, intend," contemplate, "estimate, assume or other similar expressions. Such forward- looking statements are inherently uncertain because the matters they describe are subject to risks (both known and unknown), uncertainties and other unpredictable factors beyond the control of the person making them. They may also be based on assumptions that may prove to be incorrect. No representation or warranties are made as to the accuracy of any such forward-looking statements. The purchase of securities and all other securities related activity is conducted through Seed Equity, a registered Broker/Dealer and a member of FINRA/SIPC. Seed Equity is a wholly owned subsidiary of Seed Equity Holdings, LLC ( Seed Equity Holdings ). The website SeedEquity.com is owned and operated by Seed Equity. Neither Seed Equity nor Seed Equity Holdings makes any investment recommendations. Neither the listing of a third party company's offering on its website nor any other communication, whether made through this presentation or in any other way, should be construed as a recommendation to buy or sell any security. 2
About Seed Equity Seed Equity Ventures, LLC Seed Equity Ventures, LLC ( Seed Equity ) is a registered Broker Dealer with the U.S. Securities and Exchange Commission and a member of FINRA and SIPC. We are authorized to engage in private placement of securities and M&A advisory services. We believe the best entrepreneurs in the world should be funded, no matter who they are or where they live. In addition, investors, throughout the world, no matter where they are, should have a voice to choose what the future should look like. They should be able to support entrepreneurs that will build that future. We we have members, investors, and entrepreneurs from various countries around the globe. Seed Equity Ventures unique Online Investing Platform allows investors to Like, Follow, Mentor and Invest in innovative startups throughout the world. Seed Equity Ventures is located in Salt Lake City, UT with an office in San Francisco, CA. 3
About Seed Equity The team has a strong and successful track-record Founded Interbank FX IBFX in 2001 Registered in the US as a Retail Foreign Exchange Dealer with the CFTC and the NFA. Registered in Australia with ASIC as a Derivatives Dealer. Had on boarded about 250,000 customers in 142 countries Over $500m in customer funds deposited Offices in the U.S., Beijing, Seoul, Honk Kong, Sidney and London Sold IBFX to Tokyo based Monex Group in November 2011 4
Company History March Broker Dealer application filed with SEC and FINRA February - SEC and FINRA approved Seed Equity Ventures B/D August 18 - Seed Equity launched April - Closed funding round for Consensus September- Closed funding round for NimbleSchedule 2011 2012 2013 2014 2014 2015 2015 November - Interbank FX sold to the Monex Group October - 1 st funded Company July - Closed funding round for Shred Video August- FINRA approved Seed Equity Ventures Online Investing Portal January - $875,000 raised for Studio Design September - Closed funding round for Micro Benefits 5
Problem Funding Gap Typical fundraising cycle Amount of Capital Needs $ Friends/Family & Perks Based Once startups have met minimum viable tests, Seed Equity seeks to fill the funding gap that many entrepreneurs face when trying to raise capital in startup and early growth stages. Funding Gap Mainstream Financing Institutional Capital Idea/Inception Prototype Startup Early Growth Expansion 6
Sources of Deal Flow VC Network and Colleagues Seed Equity Ventures Online Broker Dealer Platform Accelerators and Incubators 7
Investment Process First Contact Screening Due Diligence Investment Mentorship Exit Deal sourcing Seed Equity Ventures Platform VC Network Brief evaluation of: Technology Business model Founders In-depth evaluation of: Technology & IP Business model Management Negotiation of legal documentation is fundamental to future rights and obligations Mentoring entrepreneurs while helping successfully grow their business Sale of shares in order to generate a return: IPO or Trade Sale (M&A) Accelerators & Incubators Investor Network Entrepreneur Network Market Financials Market Background Check Exit Strategies Due Diligence Findings positive? Introducing entrepreneurs to global network of investors, mentors and other entrepreneurs Return 8
Market Opportunity 2016 Will Change the Industry In 2014, around 7% of the U.S. population could qualify as accredited investors. -Ken Marienau, CEO of Mission Markets In 2016, Title III of the JOBS Act will allow the remainder of the population to invest in startups. 300 Thousand Active Angel Investors in the U.S. 300 Thousand 278 Million U.S. citizens who will be able to invest in 2016 U.S. Citizens Who Will Be Able to Invest in 2016 9
Market Opportunity Estimated number of households in the world that are able to make small investments in growing startups. 344 Million 2025 Estimated Crowdfunding Market Size $300 322 Billion *Report produced by Richard Schwartz for the World Bank 300 Thousand Million If U.S. families devote just 1% of their assets to investing in startups via crowdfunding, that would unleash a torrent of $300 billion annually. - Fred Wilson, USV U.S. citizens who will be able to invest in 2016 $30 Trillion in Total U.S. Savings There are global investors that want to invest in innovative startups but lack access, presence and community influence. 97% 2014 AMERICANS SURVEYED THAT NOTED AN INTEREST IN STARTUP INVESTING Survey Conducted by Mattermark 10
Market Opportunity Key Trends Relatively untapped, rapidly growing equity crowdfunding market for startups Low penetration of equity crowdfunding in overall venture funding for startup Growing legitimacy as an asset class for global investors Key growth drivers Increase in internationally diversified portfolios Crowdfunding becomes global phenomenon Acceptance of startup investing a stand-alone investment Efficiencies created by electronic and social investing platforms Positive regulatory environment in the United States has helped stimulate the growth of funding options for entrepreneurs Individual investors are now having the opportunity to invest in an ever growing ecosystem on global startups. *Massolution 2015 Crowdfunding Report 11
Market Opportunity Key regulatory developments in the equity crowdfunding market On April 5, 2012, the Jumpstart Our Business Startups ( JOBS ) Act was signed into law. The Act requires the SEC to write rules and issue studies on capital formation, disclosure and registration requirements. October 2013 Both the SEC and Finra issue proposed rules and regulations for Title III of the JOBS Act, which allow nonaccredited investors to participate in equity private offerings March 25, 2015 The Securities and Exchange Commission adopted final rules for Regulation A. The rules are mandated by Title IV of the JOBS Act. 2012 2013 2013 2014 2015 September 23, 2013. SEC Eliminates the Prohibition Against General Solicitation and General Advertising in Rule 506 and Rule 144A Offerings October 30, 2015 The Securities and Exchange Commission adopted final rules for Title III of the JOBS Act allowing non-accredited investors to invest in early-stage companies. 12
Regulation D Offerings Type of Offering Dollar Limit Manner of Offering Issuer and Investor Requirements Filing Requirements Restriction on Resale Blue Sky Exemption Rule 506 (c) None. General solicitation permitted, provided that all purchasers are accredited investors. All investors must be accredited investors. Issuer must take reasonable steps to verify accredited investor status. File Form D with the SEC no later than 15 days after first sale. Restricted Securities. No need to comply with state blue-sky laws. Most states require a notice filing. Rule 506 (b) None. No general solicitation or general advertising. Unlimited number of accredited investors and up to 35 nonaccredited investors that are sophisticated. File Form D with the SEC no later than 15 days after first sale. Restricted Securities. No need to comply with state blue-sky laws. Most states require a notice filing. Regulation A Tier 1 $20 million within prior 12 months but no more than $5 million by selling security holders. Testing the water permitted before and after filing For 1-A. Sales permitted after Form 1-A qualified. Eligible issue. No investor requirement; however, investors who are natural persons and are not accredited investors are subject to an investment limit. File test-the-waters documents, Form 1-A, any sales material report of sales and use of proceeds with the SEC. Issuer subject to ongoing reporting requirements. Not restricted securities. Subject to state blue-sky laws regarding preoffering review, filing and antifraud. 13
Regulation D Offerings Type of Offering Dollar Limit Manner of Offering Issuer and Investor Requirements Filing Requirements Restriction on Resale Blue Sky Exemption Regulation A Tier 2 $50 million within the prior 12 months, but no more than $15 million by selling security holders. Testing the water permitted before and after filing For 1-A. Sales permitted after Form 1-A qualified. Eligible issuer. No investor requirement; however, investors who are natural persons and are not accredited investors are subject to an investment limit. File test-the-waters documents, Form 1-A, any sales material and report of sales and use of proceeds with the SEC. Issuer subject to ongoing reporting requirements. Not restricted securities. Not subject to state blue-sky laws regarding preoffering review, however, subject to state blue-sky filing and antifraud requirements. Regulation Crowdfunding Up to $1 million in a 12-month period. Offering must be made solely through broker/dealer, or a funding portal. Issuers are not reporting companies, not fund, and not subject to disqualification. Requires the preparation of a Form C, which resembles a Form 1-A. Subject to certain transfer restrictions for one year. No need to comply with state blue-sky laws. 14
506 (b) 15
506 (c) 16
506 (c) Offering Profile 17
506 (c) Offering Followers 18
506 (c) Offering Executive Summary 19
506 (c) Offering Executive Summary 20
506 (c) Offering Team Members 21
506 (c) Offering Data Room 22
Equity Crowdfunding JOBS Act Title III - Equity Crowdfunding for Non- Accredited Investors On Oct. 30, 2015 the Securities and Exchange Commission adopted final rules to permit companies to offer and sell securities through equity crowdfunding for non-accredited investors. The SEC and FINRA have mandated that only firms registered and regulated by the SEC and FINRA will be able to participate in equity crowdfunding with non-accredited investors. Seed Equity has the necessary registrations as a Broker Dealer and will allow non-accredited investors to invest through its platform once the regulations go live on May 16, 2016. *Seed Equity still needs to file a notification with Finra to offer Title III investing on its platform. Individual investors, over a 12-month period, can invest in the aggregate across all equity crowdfunding offerings up to: o If either their annual income or net worth is less than $100,000, than the greater of: $2,000 or 5 percent of the lesser of their annual income or net worth. o If both their annual income and net worth are equal to or more than $100,000, 10 percent of the lesser of their annual income or net worth; and During the 12-month period, the aggregate amount of securities sold to an investor through all equity crowdfunding offerings may not exceed $100,000 23
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