The startup Cowboy has been forced to end its crowdfunding campaign. After a start that surprised even the founders themselves, the startup has to adapt its information leaflet at the request of the FSMA, the Belgian financial regulator.
Discover the world’s most interesting finance news with the Born2Invest mobile app. The app provides its readers with access to the latest news in the stock market, finance, global business, and also trending topics like bitcoin, cryptocurrency, and crowdfunding.
Risks involved in investing
After surpassing the $4 million (€3.6 million) mark raised via the Crowdcube platform in just two days, the e-bike startup’s campaign has come to a halt. In an e-mail sent to the community, Adrien Roose, CEO and founder of Cowboy, explained that the information notice needs to be rewritten.
This notice is intended to inform potential investors about the risks associated with the investment, the shareholders and the possibilities of future resales of the shares. It seems to be problematic from a legal point of view, according to the laconic communication of the startup. In reality, the startup had no choice. It was the FSMA, the Belgian financial regulator, who asked the startup to stop the financing campaign.
The main problem between Cowboy and Nominee partnership
One of the problems lies in the relationship between Cowboy SA and Nominee, the parent company of the Crowdcube platform, which hosts the crowdfunding campaign. This relationship clearly needs to be clarified, as well as the future relationship between the Nominee and the investors.
If the FSMA was not consulted beforehand by the startup, it is simply because it is not obliged to do so, since its campaign had a target of less than $5.5 million (€5 million). It was therefore not required to publish an investment prospectus either, but simply an information memorandum aimed at future investors. The memorandum published by Cowboy contained numerous shortcomings and did not comply with Belgian legislation on several points.
Pending this new version of the Investment Memorandum, the Equity Drive is suspended until further notice. “No new investments will be accepted until then,” the startup’s email to potential investors stated.
First crowdfunding campaign
The startup’s founders explained that the FSMA has asked to consult and verify the information memorandum to check its terms. This is the first campaign carried out on Belgian grounds by the Crowdcube crowdfunding platform, which may explain the FSMA’s request for verification.
For its part, the FSMA confirmed that it had intervened in the case and simply explained that this type of verification is always not done beforehand, without giving any further information. The Belgian regulator is not in the habit of commenting on ongoing cases.
The participatory fundraising campaign can resume once the information note has been corrected by the startup.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in L’Echo, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
HoMu Health Ventures Launches in Reproductive Medicine
HoMu Health Ventures has its own capital to financially support emerging companies in their pre-seed and seed phase. In this...
Transitory Inflation Debate
the US economy is about to go over a massive fiscal cliff; and the monetary cliff is just as deep....
Due to Demand Concerns, the Rice Prices were Lower Last Week
Rice prices were lower for the week in good volume trading on demand concerns. It looked like speculators were the...
Genomcore Finalizes its Entry into the United Kingdom after Increasing its Turnover by 73% in 2021
Genomcore has recently entered the market in the United Kingdom. In 2020, the company had a turnover of $912,000 (€750,000),...
The Fintech Ecosystem in Colombia Exceeds 322 Companies
The digital credit segment is the leader in Fintech service offerings, followed by payments and corporate finance, according to Fintank...
Featured6 days ago
Crowdfunding for the Creation of a Legal Defense Fund for Wind Power Projects Completed
Crypto7 days ago
Bitcoin Recognized as Official Currency in El Salvador
Crypto5 days ago
Stablecoins: The New Kid On The Crypto Block
Africa6 days ago
The Valorization of Technologies, Inventions, and Innovations in Burkina Faso