SAFE Investment

Tags: Investment

SAFE Investment Instrument for Beginners - All You Need To Know



A SAFE stands for a “simple agreement for future equity”. The mechanism was authored by Y Combinator lawyer Carolynn Levy and open sourced. It was created and published as a simple replacement for convertible loan notes (CLNs).


A SAFE is an agreement between an investor and a company that provides rights to the investor for future equity in the company similar to a warrant, except without determining a specific price per share (or a valuation) at the time of the initial investment.


This element (no valuation) is key especially in start-ups in certain sectors where the future earnings of the company are very difficult to quantify.


In practice a SAFE enables a start-up company and an investor to accomplish the same general goal as a convertible loan note, though a SAFE is not a debt instrument.


The SAFE investor receives the future shares (typically at a discounted price) when a priced round of investment or liquidity event occurs. SAFEs are intended to provide a simpler mechanism for start-ups to seek initial funding than convertible notes.


SAFEs solve a number of issues that convertible loan notes have for start-up companies. Because SAFEs are not debt instruments, they remove the threat of insolvency that a convertible loan note can cause, and they remove the need for founders to go back to investors to request maturity date extensions (this also saves investors from having to deal with extension paperwork). Additionally, SAFEs reduce the amount of legal cost and negotiation time by simplifying the agreement relative to most convertible loan notes.


Unlike a convertible loan note, a SAFE is not a loan; it is more like a warrant. In particular, there is no interest paid and no maturity date, and therefore SAFEs are not subject to the regulations that debt may be in many jurisdictions.


While the SAFE may not be suitable for all financing situations, the terms are intended to be balanced, taking into account both the start-up’s and the investors’ interests. There is a trade-off between simplicity and comprehensiveness, so while not every edge case is addressed, it is believed the SAFE covers the most pertinent and common issues.




Invest in Companies That Enterpri...

How to Invest in Companies That Enterprise Ireland Invests In


If you are an ordinary private individual with anything from €100 to €100,000 available to invest in high growth Irish companies, how can you gain access to these types of investment opportunities? 

Spark Crowdfunding has a solution.  

In February 2021, Pitchbook, a leading Venture Capital (VC) and Private Equity Investment Platform, reported that Enterprise Ireland ranked first in the world of venture capital investors by deal count, a fantastic achievement by the Irish organisation.  

One of the ways by which Enterprise Ireland invests in Irish Start-ups is through its High Potential Start-up programme.  This programme typically sees Enterprise Ireland invest alongside other investors that the Start-Up is required to identify.  In fact, it is usually a condition of the Enterprise Ireland investment that the Start-Up must bring to the table a matching amount of investment to that which Enterprise Ireland is investing.  

So, for example, if Enterprise Ireland is investing €250,000, the founder of the Start-up is required to find investors also willing to invest €250,000 in the business.  This is known as ‘matched funding’.

Very often, these early-stage companies do not have access to investors who can help provide this €250,000 that can unlock the €250,000 from Enterprise Ireland.  There are many ways in which they can secure these funds, but, increasingly, Irish Start-ups are turning to Spark Crowdfunding to gain access to a large database of private investors who can help.  

Over the past two years, 16 Enterprise Ireland funded companies have successfully raised investment funding on the Spark Crowdfunding platform, for the first time giving small and medium-sized Irish investors access to a broad variety of new and exciting investment opportunities.

But, in addition to gaining access to investment opportunities favoured by Enterprise Ireland, what are the other benefits for Irish investors that Spark Crowdfunding can offer?


7 Benefits for Irish Investors


1. Pay No Commission to Invest

Investors pay no commission when investing with Spark Crowdfunding.  100% of your investment goes into purchasing the shares.  Only the company raising investment funds pays any commission.


2. Receive a 40% Tax Rebate on the Investment

Almost all of the investment opportunities on the Spark Crowdfunding platform are EIIS qualifying companies.  This means that Irish investors can reclaim 40% of the value of their investment in the form of a tax refund.  In other words, if you invest €1,000 in a campaign, you receive a tax rebate of €400, which means your maximum loss is €600.  


3. Unlimited Upside Potential

While the EIIS tax rebate limits your loss to 60% of your investment on the downside, there is no limit to the upside potential of your investment.  As an ordinary shareholder in the company you continue to benefit for as long as the share price continues to rise – there is no cap on how much you can make.  


4. Small Minimum Investment amount

As part of our mission to make investment opportunities accessible to investors of all sizes, we have put a minimum investment amount of just €100 on campaigns on the Spark Crowdfunding platform.  You could say we are trying to democratise Dragons’ Den!


5. Build your own Private Portfolio of Shares 

With a very low minimum investment size and no commission to pay on investing, Spark Crowdfunding makes it very easy for private investors to build their own portfolio of shares across a wide variety of companies, from tech to retail and everything in between.  Moreover, every company that raises funds on the Spark Crowdfunding platform is required to provide its shareholders with a Quarterly update on how the business is performing, so you will receive regular progress reports from the founders.  


6. Free to Join

There are no fees to join Spark Crowdfunding, nor do we charge maintenance fees to operate an account.  We don’t hold Client Funds and you only ever transfer funds when you wish to make an investment.  


7. Invitations to Investor Webinars

As a valued member of Spark Crowdfunding, you will receive regular invitations to attend our Investor Webinars and ask questions of the promoters looking to raise new funds.  

Join thousands of other Irish investors and get with the crowd!

If it’s good enough for the largest Venture Capitalist in the world by deal count ……………………!

Click here to join Spark Crowdfunding for free.  It takes less than 2 minutes to register and receive regular notifications of new investment opportunities from as little as €100.  



How the Nominee works for Spark C...

Tags: Nominee

How the Nominee Structure works for Spark Crowdfunding investors


When you buy shares in a company on the Spark Crowdfunding platform, we (at Spark Crowdfunding) aggregate all of these investments into one large investment amount. 


We do this for several reasons.  Firstly, under Irish statute law, private companies may not have more than 149 shareholders.  Crowdfunding campaigns, by their very nature, create lots of small to medium sized shareholders for a private company and the only way they can all become shareholders is if they come together as a single shareholder.  


Secondly, it makes it much easier for the company raising funds on the Spark platform to raise funds at a later date (after their crowdfunding round) from (say) a Venture Capital investor if they have a relatively small number of shareholders in their company.    


The cleanest, simplest and least expensive way to aggregate all shareholders from an equity crowdfunding round is to use a vehicle known as a Nominee Company. 


In layman’s terms, a Nominee shareholder is one who holds shares on behalf of the actual owner (beneficial owner) under a custodial agreement.  


Legal Ownership versus Beneficial Ownership

Companies that raise funds on Spark Crowdfunding use a company called Pearse Trust to manage the Nominee vehicle that holds all of the new shares that have been purchased in the crowdfunding round.   


As an investor in a company whose shares are held in a Nominee company you are the beneficial shareholder in that company.  The legal shareholder is Pearse Nominees Limited (PNL).  PNL hold a single share certificate for all of the shares that are cumulatively held by the members of the Nominee company. 


All of the individual investors have rights to a percentage of those total shares in direct proportion to the size of investment they have made in the company that raised the funds.


Pearse Trust Ltd and Pearse Trust Nominees Ltd

Pearse Trust Limited (CRO#: 111529) is a legal and company secretarial business that is based in Sandyford, Co Dublin and has operating in this specialist area since the current directors Joseph Hickey and Grainne Riordan founded the company in 1985.


Pearse Trust Nominees Limited (CRO#: 130202) was incorporated in 1988 and is the vehicle that Pease Trust uses to host its nominee structures.


Almost all of the companies that have raised funds on the Spark Crowdfunding platform use the services of Pearse Trust to manage the relationship between the new shareholders and the company that has just raised funds.  It should be noted that Spark Crowdfunding is not a party to the Nominee arrangements and plays no role in the relationship between Pearse Trust and the company that has just raised the funds and its new investors.  However, we are available to answer any questions that an investor may have about how a Nominee vehicle operates. 


Role of Pearse Trust

Once an equity crowdfunding campaign has finished on the Spark Crowdfunding platform, legal agreements are prepared to protect the new investors.  A company that retains Pearse Trust to manage the shareholder arrangements will instruct Pearse Trust to email all of the new investors with information about the crowdfunding campaign and a copy of the legal agreement that governs their investment.  Pearse Trust then gathers all of the signatures from the new investors, confirming their intention to proceed with the investment.  


From that point on, all shareholder communications from the company that has raised the funds will come from Pearse Trust, as the Nominees.  The Nominee is structured so that not all members need to vote, and of those who do, 50% of the shareholding + 1 share will decide the result of the resolution.  The whole block in the Nominee will then vote accordingly.


Being a part of a nominee does not dilute your rights as a shareholder in any way.  Your rights as a shareholder are exactly the same as if you held the shares in your own name on the Shareholder register.  


Please contact us if you have any questions about this.  

Should I Invest in a Crowdfunding...

Tags: Investing

Investor Checklist – Should I Invest in a Crowdfunding Campaign or Not?


If you are thinking of investing in an equity crowdfunding campaign on Spark Crowdfunding but don’t know what factors you should take into consideration, we have prepared a checklist of ten things you should consider.  


We would caution against an investment unless it ticks most or all of these boxes:


1.  The Business Model

Is the business scalable?  A scalable business is one that can increase profits over time, by growing revenue while avoiding cost increases.  Another way to describe a scalable business is one which can serve an increasing number of customers without having to increase its costs as a result.  For example, a company that sells software can sell the exact same software to many customers, without increasing its costs by much.  A hairdresser, on the other hand, is limited by the amount of hours she works and can therefore only serve a limited number of customers.  Scalable businesses have the potential to grow much faster and therefore deliver a higher return for investors.   


2.  Size of the Market

How large is the market that the company is targeting?  You don’t need to know to the exact penny how big the market for a particular product is, but you should be able to make a good, educated guess as to whether it is big enough to allow the company to achieve its Sales targets.  Factor in the level of competition, both actual and potential.  


3.  Intellectual Property (IP)

Does the company have any IP, such as a Patent, that can protect it from new entrants to the market?  Patents are extremely difficult and expensive to get, and most successful companies have no patents, so this factor should not be a deal breaker, but look for quasi forms of protection, such as a large database of users or a strong brand.  


4.  Company Achievements to Date

Companies raising funds on Spark Crowdfunding tend to be at an early stage in their evolution, but before they raise funds, they should be able to point to some level of achievement.  This could be anything from a successful pilot exercise with a Minimum Viable Product to a signed contract from a paying customer.  Another achievement could be in the form of third-party validation from Enterprise Ireland through participation in its High Potential Start-Up (HPSU) programme.    


5.  Quality of the Management Team and Previous Successes they have had

Does the Management Team have the skills, knowledge, attitude and aptitude to successfully execute the Business Plan?  What have they done in previous jobs or with previous companies to support this?  Don’t necessarily rule out someone who has had a previous business failure.  Every failure is a victory if you learn from it.     


6.  Use of Funds

To what use are the new funds being put?  Funds being used to increase bottom line profits are generally preferable to funds being deployed to build an infrastructure that only then starts to increase bottom line profits.  Related to this is whether the amount being raised is sufficient to enable the company to deliver on its plans or whether it will need to raise funds again.  There is always a risk that a company may not be able to raise funds the next time.    


7.  Timeframe

How long is it likely to take for the company to execute its business plan and what risks are associated with this?  Related, what is the likely timeframe for investors to get an exit and what form is that exit likely to take – trade sale or flotation?  


8.  Company Valuation

Valuing early stage companies is difficult.  A basic question to ask is “Am I likely to get a minimum of 3 times my investment back and ideally five times my investment?”


9.  Tax Breaks Available

Can I get a tax refund on my investment?  In Ireland, many companies qualify for the EIIS Scheme, which means investors in these companies can receive an immediate tax refund of 40% of the amount they invest.  So, if you invest €1,000 in a company, you get an immediate tax rebate of €400.  In effect, you are investing in the company at a 40% discount, which has a substantial impact on your net return.  

Here are two articles we have written about the EIIS Scheme:


10.  Who else is investing?

It’s always useful to see who else is investing in a campaign.  You can easily check this by looking at the campaign page on the Spark Crowdfunding website.  You can also join one of the Investor Clubs operated by Spark Crowdfunding by clicking here:




If you’d like to join thousands of Irish Investors and get exclusive access to investment opportunities in some of the leading Irish start-ups, click here to join Spark Crowdfunding:


It’s free to join and only take a few minutes to register your profile.   


Join Thousands of Irish Investors...

Tags: Investors

Join Thousands of Irish Investors getting exclusive access to exciting Irish Startups

In May 2010, a private Startup run by two Irish brothers was valued at $2 million.  They couldn’t find investors in Ireland and so they raised funds in the US.  In April 2020 this company was valued at $36 billion.  If you had invested $1,000 in 2010, it would be worth $18,000,000 today. 

The name of the company is Stripe and it was founded by John and Patrick Collison from Limerick. 

Back in 2010, there was no platform through which Stripe could allow Irish investors to buy shares in companies like Stripe.  Today, there is – Spark Crowdfunding.

It is the only company in Ireland that offers equity crowdfunding and anyone with €100 to invest can join.


Dragons’ Den for Ordinary Investors

Equity crowdfunding gives private investors access to investment opportunities that were once only accessible to large Venture Capital firms.  

Think of equity crowdfunding as an online version of Dragons’ Den, where ordinary investors can become the Dragon.  When enough of these Dragons invest together, they become a ‘crowd’ and the crowd buys shares (or equity) in a private company as a group.    


Spark Crowdfunding

Established in Dublin in 2018, Spark Crowdfunding is simply an online platform that connects private Irish companies seeking to raise funds with ordinary Irish individuals who are interested in investing in Irish start-ups.  

The process is very straightforward.  A company uploads a campaign to the platform, which includes a video and a description of the business.  Investors make a decision on whether they wish to invest in the company or not - and can invest anything for €100 to €100,000.  The average investment size is roughly €2,000.      

Investors on the Spark Crowdfunding platform have invested in 14 Irish start-ups over the past two years, in amounts ranging from €50,000 to €560,000.  Many of these companies have also been funded by Enterprise Ireland.  


Case Study – Success Story

In December 2018, a car hire app called Fleet raised €384,000 from 132 investors on the Spark Crowdfunding platform at a valuation of €1 million.  The value of Fleet increased over the following 15 months, and in March 2020 Fleet raised more money at a valuation almost three times higher than the valuation at which the Spark Crowdfunding investors purchased their shares. And this doesn’t even include the 40% tax refund the Irish investors received on their investment.     


Generous Tax Refunds for Investing in Irish Start-ups

Investors who invest in most of the Start-ups on the Spark Crowdfunding platform can receive very generous tax breaks on their investments.  Specifically, investors can receive a 40% refund on investments in companies that are EIIS approved.  Therefore, a €1,000 investment would receive a tax refund of €400, regardless of how well the company performs.  Further information about this may be found in this article:


How to Join the Crowd and Invest in Exciting Irish Start-ups

To access these investment opportunities, it is necessary to register as a member of the Spark Crowdfunding platform.  It’s free to join and there is no obligation to invest.  Click here whenever you are ready to join:


Perhaps your first investment could turn out to be the next Stripe!!


How a Nominee Structure Benefits ...

A key feature of the Spark CrowdFunding model is the nominee structure. This is a process whereby the start-ups’ shares are held and managed on behalf of the investors after an investment has been made.

A nominee structure is crucial for any equity crowdfunding campaign as it protects investors’ interests and provides direct communication for the start-ups to their investors. We will explain the process in greater detail below.


What is a nominee?

A nominee is a person or company that holds assets such as shares on behalf of another, enabling the nominee to handle complicated administrative matters.


How does the nominee structure work?

Instead of the shares being issued directly to the investor, they are instead issued to a nominee company. In Spark CrowdFunding’s case, this company is Pearse Trust. The nominee is named in the company’s register of shareholders and will be the legal holder of the shares.

Pearse Trust (the nominee company) will hold the shares on trust for the investor (the beneficial owner) and Pearse Trust will administer the holding on the terms set out in the Investor Terms to safeguard the investors’ rights and entitlements.


Benefits for Investors

If you were to crowdfund without a nominee structure in place, investors would be left managing the administration of their investments on their own, which becomes very cumbersome, especially if they have made multiple investments.

By employing a nominee structure, Spark CrowdFunding removes the administrative hassle for investors by taking care of all the technical shareholder work allowing them to just focus on their investments directly through the Spark platform.


Benefits for Start-ups/Companies

Without a nominee structure in place, companies would have to communicate with each investor who pledges with them, which would be time-consuming and difficult to track and manage.

However, a nominee structure vastly improves the communication process as the start-up only needs to communicate with one legal shareholder (the Nominee).


If you are interested in signing up as an investor with Spark or would like to know more about raising funds for your business, please click on either of the buttons below: 


12 Steps to Crowdfunding Success

Crowdfunding continues to grow in popularity, with many startups and SME’s now considering it to raise funds and help their business grow. It has the potential to be extremely successful, allowing more people to be involved in your company’s success, creating a sense of community amongst customers.

Here are Spark CrowdFunding’s 12 steps to improving the performance of your crowdfunding campaign:


1. Tell a compelling story

People are more likely to invest in a project or business that appeals to them, something that plays on their passion and interests. Make sure your audience knows why you are passionate about making your project a reality. Allowing people to put a face with the project and showing them what your business will look like, will be extremely beneficial.


2. Use your connections to encourage early investment

Getting your family and friends to promote your campaign can give you an initial boost. Your investors could be anyone from your friends and family to university colleges or past employees. Try and let everyone know about your ideas and plans. When your campaign goes live and your connections invest, you can secure 20-30% of your investment target in a short space of time. Securing a significant portion of investment early in the campaign will likely encourage more investors to sign up, as they will see there is great demand in the company.


3. Embrace social media

Simply promoting your campaign on a crowdfunding platform is not enough. You need to engage with potential investors across multiple online channels, to promote your business as much as possible. Social media to is a great way of spreading the word. Something as simple as a tweet with relevant hashtags or a blogpost containing keywords can reach thousands of potential investors.


4. Be clear and transparent

Be clear on what you are trying to achieve and what the money you are raising will be used for. Communicating clearly to potential funders about what your campaign is trying to achieve is very important. It will help give your business a sense of identity too and help stand out from the crowd.


5. Be realistic

Being realistic is vital. You need to have a clear plan of how much money you require to commence your startup or need to continue your business growth. You need to have a realistic budget in place. Ensure that you cover all potential barriers to investment and discuss the risks. Before going live with your campaign, you should have clear goals. If your target is unrealistic the crowd will most likely not engage with your project.


6. Keep communicating and engaging

Tell investors your story and keep them updated with your plans and how your campaign is going. This could range from simply thanking backers for their investment or replying to comments and answering questions. By actively engaging with your supporters, you can create a loyal group of company advocates that can help promote your brand moving forward.


7. Talk to the experts

Many crowdfunding services will offer you the opportunity to discuss your campaign with them. Take them up on it! They can answer any questions you have and also offer advice and feedback on your campaign. If you are new to the crowdfunding experience or even a seasoned veteran of it, getting advice from the experts could be the difference between a successful and failed campaign.


8. Have a strong business plan in place

No matter what channel you choose to pursue to raise funds, you will always need a clear and professional business plan in place, and crowdfunding is no different. In order to get your campaign to go live, you will need to show a solid business plan that potential investors can review, so they understand the type of company they would be potentially investing in.


9. Create an engaging video to promote brand

Numerous studies show that people, including your potential investors, are increasingly preferring short, quality videos over long forms of text. It is a great opportunity to get creative, be informative and cut through the noise. Create an engaging video for your crowdfunding campaign that showcases why your business is worth investing in.


10. Branding is key

The branding of your company is vital as it clearly identifies who you are and what you stand for. Communicating an unclear message across your channels or using poor quality graphics will show a level of unprofessionalism that will deter individuals from investing. Ensure your campaign has a consistent tone throughout its communications, has a clear identifiable logo and a professional looking website.


11. Create a pitch deck

Every company, no matter it’s size, started with a pitch deck. Even Facebook and Google used pitch decks at some point! If you want to raise capital or convince business partners to work with you, a pitch deck is essential. It gives any potential investor an insight into your business. It is crucial that your pitch deck is clear, professional and highlights exactly what your business does and wishes to achieve.


12. Set out a clear campaign strategy

A clear campaign is strategy is crucial to the successful running of your crowdfunding campaign as it gives clear guidance on what needs to be done and ensures everyone involved knows what they need to do. It also reassures investors that their investment will be used to fund specific goals. Without a clear strategy in place, investors are unlikely to get involved as they won’t invest without knowing what will happen to their money.

Following these 12 simple steps can help you grow quickly and get the investment you need. When executed well, crowdfunding can be an extremely rewarding channel for raising funds. However, it can be a tricky task to manage on your own. That’s why Spark CrowdFunding are here to help. We are happy to answer any questions you may have around equity crowdfunding in Ireland so please get in touch.


How 5 Irish Start-ups Raised Fund...

Raising funds from private investors is difficult at the best of times.  Even if you have a world-beating product with a unique selling point, investors will want to review your strategy and make an educated guess as to whether you can increase the value of the business so that they get a sufficiently attractive return on their investment. 

It is even more difficult for start-ups where investors have to take into account factors such as the pedigree of the founders and their ability to successfully execute the strategy, the size of the market, the ability to capture enough market share and the current valuation of the business. 

There is a well-known adage in investing which says, “Manage the downside and the upside will look after itself”.  What this is basically saying is that if you try to minimise the amount you can lose (i.e. the downside risk) you don’t need to worry about how much profit (i.e. the upside) you will make. 

One of the difficulties with investing in early stage companies is that it often difficult to manage the ‘downside risk’.  Very often this downside risk can also be described as ‘losing the full investment’ because start-ups frequently go out of business with investors losing everything in the process.

Every investor makes an investment expecting to make a return on it, but similarly, no investor gets it right all the time.  In those circumstances where you, as an investor, made a bad decision and lost the full amount of your investment in a start-up, wouldn’t it be nice to be able to recover some of your lost investment through a tax break? 

This is precisely what the Employee and Investment Incentive Scheme (EIIS) achieves.  If you invest €1,000 in an EIIS qualifying company in Ireland, you are immediately entitled to a 40% tax rebate on your investment of €1,000, regardless of how the company performs.  In other words, if your investment doubles in value, you still receive a tax refund of €400, or if your investment is a complete write-off you also receive a tax refund of €400 (in the year you made the investment). 

Over the last 12 months, a number of EIIS qualified companies raised funds on the Spark Crowdfunding website.  A contributory factor to the success of these crowdfunding campaigns was the EIIS scheme.

  • In December 2018, the car-sharing app, Fleet, raised €384,550 from 132 investors.  The campaign ran for 45 days.  Fleet had originally set a target of €275,000, exceeding this goal by 40%.
  • In January 2019, the B2C campsite platform, Campsited, raised €284,482 from 70 investors.  The campaign ran for 46 days. Campsited had originally set a target of €275,000 and eventually reached 114% of this funding goal.
  • In February 2019, Wellola, a med-tech company, raised €180,500 from 63 investors, having originally been looking for €100,000, exceeding this target by 81%. The campaign ran for 41 days.
  • In July 2019, Trifol, a company who produce the first wax to be made from 100% recovered plastics, reached an incredible 175% funding for their campaign. Having originally set a funding goal of €300,000, they eventually reached €525,598 through 135 investors. The campaign ran for 45 days. 
  • In September 2019, FireBuilder, a patented protected Eco Firelighter, raised €211,175 from 55 investors. Running for 40 days, the campaign reached 106% funding, having originally been targeting €200,000.


Most of the companies that raise funds on Spark Crowdfunding are EIIS approved companies.  To receive regular notifications of EIIS investment opportunities straight to your inbox please register on the Spark Crowdfunding site for free by clicking below.



Beginners Guide to the EIIS Schem...

EIIS stands for Employee and Investment Incentive Scheme.  The purpose of the scheme is to encourage private individuals in Ireland to invest in Irish private companies in order to help these companies grow and create new jobs.

The way in which the EIIS incentivises Irish investors to invest in these companies is by offering the investor a tax refund of 40% of the amount of their investment, on the basis that the investor leaves the investment in the company for a minimum of 4 years. 

Therefore, if you, as an Investor, invest €10,000 in company ABC, you can reclaim €4,000 of this €10,000 from the Irish Revenue Commissioners when you make your tax returns for the year in which you make the investment. 

The effect of this is that the most you can lose on this €10,000 investment is €6,000, and even if your investment provides you with a big payback, you still keep the €4,000 tax rebate.  This makes a major difference to the risk-reward trade-off of the investment.   

It should be noted that the Irish Revenue Commissioners do not deem all companies eligible for EIIS status, so the tax rebate does not apply to companies in every sector. 

Investment Scenarios

Let’s take a look at a couple of investment scenarios, the first of which applies to a company that does not qualify for an EIIS tax refund and we then contrast the potential returns from this with a company that is an EIIS qualifying company.  In each scenario, the company could return either nothing to the investor (i.e. a write-off) or the company could double in value (i.e. a 100% increase in value).    

The difference between a return of 100% and 166% may not sound like an awful lot, as per the difference in investing in an EIIS qualified company and a non-EIIS qualified company in the examples above.

However, if you compound this over just 5 investments, a €10,000 investment in 5 non-EIIS companies delivers a return of €320,000, whereas an investment of €10,000 in 5 EIIS qualified companies delivers a return of €426,000, which highlights the advantages of investing in EIIS companies.   


Most of the companies that raise funds on Spark Crowdfunding are EIIS approved companies.  To receive regular notifications of EIIS investment opportunities straight to your inbox please register on the Spark Crowdfunding site for free by clicking below.


Leveling the playing field for Ir...

Imagine if Amazon had raised funds by doing an equity crowdfunding campaign shortly after they launched back in 1998 when their valuation was about €1m.  Anyone who had invested just €1 in Amazon back then would have an investment today worth about €871,000 today. 

The average investment amount in an equity crowdfunding campaign is €1,500, so an average investment in Amazon back in 1998 would be worth about €1.3 billion today! 

Unfortunately, the average investor, like you or I, couldn’t invest €1,500 in Amazon back in 1998 because crowdfunding platforms, like Spark Crowdfunding, did not exist.  Hence, it was only the Venture Capitalists who earned these massive returns on investments in startups like Amazon. 

Does that sound fair to you?  Is that a level playing field when it comes to investing in startups?


Democratising Finance

Equity crowdfunding platforms provide small and medium sized investors with access to exciting early stage companies, like Amazon.  Essentially, these platforms make it as easy for a small investor with €100 to invest in a startup as it is for a venture capitalist with €1m to invest.  This is what is known as ‘democratising’ finance and it partly explains why equity crowdfunding has become so popular over the last 6 years. 

Where Dragons’ Den enables just 5 investors to invest in a startup, equity crowdfunding opens it up to the wider investor community and allows thousands of investors to invest in an early stage business.  Equity crowdfunding is simply an online version of Dragons’ Den. 


The Importance of the Crowd

Assessing investment opportunities can be a challenge at the best of times.  How realistic is the company valuation, how good is the management team and how big is the demand for the product are just some of the questions an investor will ask.  It is very difficult for any one individual to take all of these factors into account and make an informed decision.  This is where the crowd can help.     

In his excellent book ‘The Wisdom of Crowds’, James Surowiecki provides may examples showing that “a diverse collection of independently deciding individuals is likely to make certain types of decisions and predictions better than individuals or even experts”.  Equity crowdfunding platforms provide the ideal vehicle for this, in two ways. 

Firstly, investors can engage directly with company promoters and ask questions about the history or plans of the company, with the answers to these questions on show for all members of the platform.  Second, and more importantly, investors can see exactly how much money other investors have pledged to invest in the crowdfunding campaign and use this information as a ‘signalling’ mechanism.  If no-one is investing in a campaign it is a good sign that you should ask more questions before making your own investment decision.  


Building a Portfolio of Small Investments

For every €1.3 billion investment opportunity like Amazon, discussed above, there are thousands of startups that go bust or return very little to the investors.  That’s the nature of startup investing.  Even Venture Capital firms get it wrong more times than they get it right.  But the reason many Venture Capitalists succeed is because they spread their investments across a wide portfolio of investments.  In general, for every 10 startup investments they make, six of them will be a write-off, another two will return the original investment and the last two will achieve the high multiples which will generate the required returns for the portfolio.  This is precisely the type of investment approach that small investors should adopt and equity crowdfunding platforms, like Spark Crowdfunding, now make this possible. 

Generous tax breaks from the EIIS Scheme for Irish taxpayers also reduce the risk by giving investors a 40% tax rebate on investments in Irish startups.  Please contact us for more information about this. 


Test the Water First

As with all types on investment, it is advisable to fully understand the risks before taking any action.  We would recommend that investors fully familiarise themselves with all of the features of equity crowdfunding and also investing in early stage business, and even then, test the water by starting with a very small amount of money.  

With the minimum investment amount of just €100 per campaign on the Spark Crowdfunding platform, a small investor can now build a portfolio of startup investments with as little as €1,000, and there are no hidden costs or fees for investors.

You don’t want to miss out on the next Amazon!!

Click here to view the latest campaigns or to open an Account for free





5 Common Misconceptions about Equ...

As the number of startups now using equity crowdfunding continues to rise, a number of misconceptions have developed around the process. We have highlighted the 5 most common ones, to help give you a better understanding of how equity crowdfunding works.

1. Crowdfunding is all about getting money:

Whilst raising money is undoubtedly the primary purpose of many businesses crowdfunding, it is not the only benefit. 

Crowdfunding provides an invaluable opportunity for engaging the market. You can engage existing customers and expose the business to new ones. Crucially, and unique to equity crowdfunding, investors will own a stake in your business. As a result, they have a personal interest in your future success and will act as evangelists by spreading the word about the brand going forward. Crowdfunding also affords an opportunity for improved customer feedback, as investors might offer insight on how to improve the product or service and might even suggest future products or services down the line.

2. An online crowdfunding campaign is all I need to raise the funds:

One of the most common crowdfunding misconceptions is that posting the campaign online will be sufficient in itself to raise the entirety of the capital. In other words, ‘the crowd’ is all that’s required.  Unfortunately, it’s not that easy.

Although it is possible to generate the majority of the funds through previously unknown investors, many campaigns are heavily dependent on friends and family in the early stages to get the ball rolling.  Ensure that these people know exactly when the campaign is going live so that they can support you from the outset. Be sure to contact pre-existing customers and business contacts also.

Now that your campaign has gained some initial traction it is much more likely to attract third-party investors.

3. The longer the campaign runs, the better:

This is inaccurate as a longer campaign window will only indicate to investors that you are less confident in your business’ ability to raise the required funds in a more normal time frame. It is greatly advised to raise a smaller amount of capital in a shorter amount of time, such as 30-40 days. 

4. Launching a successful campaign is easy

This misconception is one of the more dangerous. Although crowdfunding can be a more streamlined and accessible process of raising capital than other conventional methods, it still requires work. Success on the platform is all but guaranteed. Whilst the campaign is online, a business should concentrate the majority of its resources into trying to make it a success. Chasing up potential leads, maintaining a social media presence and updating investors who have already pledged all require time and resources. It would be a mistake to think that an effective campaign can be maintained in your spare time as a result.  

Moreover, research has indicated that businesses with more than one owner are more likely to succeed in crowdfunding as the burden can be shared. If you’re a sole proprietor, try to enlist someone else’s help to balance the ordinary course of business with successfully securing maintaining the online crowdfunding campaign.

5. Crowdfunding will put off VC’s and larger investors later on:

There has been no correlation between businesses that have successfully raised money through crowdfunding platforms and reluctance on the part of venture capitalists to invest later on. In reality, successful crowdfunding can fuel your business’ growth and put it on even better footing for subsequent negotiations with VC’s later on. Crowdfunding is indicative of your product or service’s popularity. A large number of people are buying into your brand, and this positive validation can be highly persuasive to subsequent large-scale investors.


If you are interested in signing up as an investor with Spark or would like to know more about raising funds for your business, please click on either of the buttons below: 



How Awesome is the EIIS Scheme fo...

How Awesome is the EIIS Scheme for Irish Investors?

“If you invest €10,000 in that company, you will receive €4,000 back in the form of a tax rebate, so you’re actually buying €10,000 worth of shares for €6,000.  In other words, you can buy those shares at a 40% discount.”

That’s how the conversation started.

I was aware that the Government had some incentive scheme to encourage investors to buy shares in private companies, but I didn’t realise it was that good!!

“Are you serious?  There is surely a catch somewhere”, I retorted.

“There’s no catch, although you only get €3,000 back from the Revenue in the first year, and only if you hold onto the shares for 4 years will you receive the final €1,000.  The only other requirement is that the Company you are investing in has been approved by the Revenue to participate in this Scheme”, he said.  

This scheme is known as the Employment and Investment Incentive Scheme, or EIIS for short.

As the name suggests, it was designed by the Irish Government to encourage investors to invest in small and medium sized Irish companies, which are basically the life blood of the country.  

The best way to explain it is with an example.


Example of the EIIS in action

Fleet is an Irish person to person car sharing app which connects people who want to rent out their car with people who are looking to rent a car.  

Fleet has been approved by the Revenue Commissioners in Ireland as an EIIS qualifying company, by virtue of its trading activities.  

Fleet is raising €275,000 in return for 20% of the company on the Spark Crowdfunding platform. 

An investor decides to invest €5,000 in Fleet.  

Assuming the investor pays Income Tax in Ireland, he/she will be immediately entitled to a refund of €1,500 (i.e. 30% of €5,000) from the Revenue for making this investment.  

If the investor holds the shares for 4 years, then they can reclaim an additional €500 (i.e. 10%) from the Revenue in that year.  

What is the Net Effect of this?

Essentially, the investor is purchasing the shares at a 40% discount to the company valuation.  

This is a very appealing tax benefit to investing in companies on the Spark Crowdfunding platform. Further information on the EIIS Scheme may be found in this Guide from the Revenue Commissioners.


If you are interested in signing up as an investor with Spark or would like to know more about raising funds for your business, please click on either of the buttons below: 


How to Invest with the Crowd in I...

Fancy yourself as a bit of a Dragon?  We all do! 

But getting access to attractive deals is impossible and you probably don’t want to invest as much as the average Dragon.  And it would be nice to able to take some comfort from knowing what other investors like yourself think of the investment opportunity. 

Equity crowdfunding gives small to medium sized investors access to the types of deals only previously accessible to Venture Capital companies (or Dragons!).  The crowdfunding industry has exploded in popularity in the UK, USA and Australia as a simple, quick and low-cost way for startups to secure venture funding.   

We didn’t invent equity crowdfunding here at Spark Crowdfunding, but we were the first company to introduce it to the Irish market in mid-2018.  Since then, our investors have invested €384,000 in Fleet, the person to person Car Sharing App; €284,000 in Campsited, the Airbnb for campsites; and €147,000 in Wellola, a med-tech video consultation app.  Interestingly, all three of these companies are also Enterprise Ireland High Potential Startup companies. 

The minimum investment amount in each of these campaigns was €100 and this was designed to appeal to as many small and medium sized investors as possible.  This did not prevent larger investors participating also and each campaign had investors who invested €25,000 or more. 


Tax Rebate for Irish Investors in Irish Startups

Irish investors can also claim a tax rebate of 40% of the value of their investment in many of these startups with EIIS (Employment and Investment Incentive Scheme) status.  What this means is that an Irish taxpayer who invests €1,000 in one of these companies can reclaim €400 in the form of a tax rebate (€300 in year 1 and €100 in year 4).  This reduces the risk or maximum loss of a €1,000 investment to €600.  Please contact us for more information on EIIS.    


Benefits of Joining Spark Crowdfunding

If you are a small to medium sized investor interested in hearing about new investment opportunities in exciting Irish startups, where the minimum investment amount is typically €100 and where you can actively monitor the amount invested as each campaign evolves and discuss the merits of the investment opportunity with investors like yourself, then Spark Crowdfunding could be for you.     


How to Join the Crowd

Registration is free and only takes a couple of minutes.  New members must answer a number of questions to ensure they fully understand the risks of investing in startups.  Click here to register now.  Investors are under no obligation to invest in any campaign and, as we don’t hold investor funds, no deposit is required until a campaign completes. 


Spark Crowdfunding – Democratising the way in which Irish investors can invest in Irish startups.


If you are interested in signing up as an investor with Spark or would like to know more about raising funds for your business, please click on either of the buttons below: 



Risk Warning – Investing in Startups is high risk and investors could lose the full value of their investment.  Investors should only invest with money they can afford to lose.  We recommend all investors seek independent financial advice before proceeding with any investment. 

Why Irish Companies should use Sp...

Tags: Irish


Equity crowdfunding is fast becoming the most popular way for Irish start-ups to raise new funds in return for selling shares in their company.

The advantages of this "Dragons' Den" type of fundraising include speed, ease of process and cost. Campaigns typically last 30-40 days, which contrasts with other types of early stage investing which can take up to nine months. The process is relatively easy, once the company has passed the due diligence requirements of running a campaign in the first place.

The costs are also very low as Spark Crowdfunding covers the legal and due diligence costs, meaning the company raising funds only pays the 6% fee on the total amount of funds raised. (Campaigns must achieve their full target in order to complete and no fees are charged if the campaign is not a success.)

But why should an Irish company use the Spark Crowdfunding platform to raise funds, as opposed to going to one of the UK or US crowdfunding platforms?

REASON 1 - Spark has the largest database of Irish Investors
We may not have the largest database of investors, but we definitely have the largest database of Irish investors. It stands to reason that Irish investors are likely to be more favourably disposed to investing in Irish companies. Meeting potential investors face-to-face is an important element of crowdfunding campaigns. Irish companies will not need to fly to the UK to meet potential investors.

REASON 2 - Spark doesn't require companies to have a minimum amount of investment committed
Many of the UK crowdfunding platforms require companies looking to raise funds to have a minimum amount of funding already raised prior to the campaign going live. In some cases, this can be as high as 40%, so if you're looking to raise €100,000, you will need to be able to demonstrate that you already have commitments of €40,000. Spark does not have this requirement, although we do recommend you have at least some commitment in order to generate early momentum for your campaign.

REASON 3 - Spark has local knowledge of the EIIS 'Tax Refund' Scheme for Irish Investors
For Irish taxpayers, the Employment and Investment Incentive Scheme (EIIS) allows individual investors to obtain income tax relief on investments made, in each tax year, into EII certified qualifying companies. It is an extremely attractive scheme for Irish taxpayers, who can reclaim 40% of the amount of their investment - 30% in year 1 and 10% in year 4. Therefore, if an Irish investor invests €1,000 in a EIIS qualifying company, the investor receives a tax rebate of €300 in the first year and €100 in the fourth year. The investment would need to fall by more than 40% before the investor would lose any money. We discuss this in a previous blog post.

REASON 4 - Spark has strong connections with Irish Media Channels
A key contributor to the success of an equity crowdfunding campaign is the amount of media exposure that can be generated for the campaign. If you speak to companies that have raised money on Spark, they will confirm that we have been able to assist them with media exposure. Good media exposure for campaigns is also good media exposure for Spark, so we have every incentive to assist Irish companies to maximise their media exposure.

REASON 5 - Spark uses Irish Solicitors
When a campaign finishes, the last thing an Irish company wants to be doing is engaging with a UK firm of solicitors. Spark is advised by Beauchamps, one of the leading law firms in Ireland. We also cover the cost of the legal fees, a significant saving over other forms of fundraising where legal fees can be particularly onerous.

REASON 6 - Spark assists with Digital Marketing and Social Media campaign promotion
A number of team at Spark are highly experienced and highly qualified (to Masters level) in the areas of digital marketing and social media marketing. We are very happy to share this expertise with companies looking to promote their equity crowdfunding campaigns using these new channels.

Spark Crowdfunding is an Irish company, located two minutes walk from Grafton Street on the fashionable South William Street. We are the first and only equity crowdfunding platform in Ireland. We want to assist ambitious Irish entrepreneurs and in turn hope these Irish entrepreneurs will, all else being equal, 'buy Irish'.


So, if you are a high growth Irish company, whether that's a start-up or a long-established business, and you're looking for a highly efficient way to raise new funds, come and talk to us at Spark Crowdfunding or click on the buttons below.

We're with you every step of the way!



12 Most Common Equity Crowdfundin...

Tags: Guide

At Spark Crowdfunding, we meet companies every day that are looking to raise new funds for growth.  Many of the same questions arise at these meetings. 

We therefore thought it would be a good idea to capture the answers to these questions in a single blog post and share it with our readers.  Feel free to ask any additional questions on our Contact Us page. 


1. How long do campaigns last?

Equity Crowdfunding campaigns typically last for 30 days, but it is at the discretion of the company raising funds as to how long a campaign will run.  There is no law or rule that states how long a campaign could last, so, in theory anyway, a campaign duration could be as short as one day, or as long as 12 months.  We would recommend something between 30 and 40 days.  


2. Can I extend my campaign if I don’t achieve my target?

Yes.  Campaigns can be extended any time during the campaign and for as long as the company raising the funds chooses.  It’s perfectly normal for a campaign to be extended if a promoter believes a higher amount could be achieved by extending the campaign.    


3. How much fees do I pay?

Investors pay no fees to invest in Campaigns.  The company raising the funds pays a flat fee of 7% (plus VAT) if the campaign succeeds in reaching its original target.  No fees are payable if the campaign does not achieve its target. 


4. Are there any other Costs that a company must pay?

The Company raising the funds is liable for the Credit Card Admin Costs associated with collecting the funds.  This is typically 1% of the amount raised.  Another cost that needs to be considered is the cost of setting up the Nominee Structure that manages the new shareholders who invest in the company.  Spark Crowdfunding can recommend a specialist Irish company that offers this service.  The company raising funds is also responsible for paying its own legal fees.  Please contact us for more information on the likely costs associated with each of the above.    


5. How do I deal with all of the new Shareholders that come through my campaign?

Under Irish Company Law, the maximum number of shareholders that a private limited company can have is 149.  Companies raising funds via equity crowdfunding often attract a large number of small to medium sized investors.  Rather than adding all of the individual shareholders to the Shareholder Register, instead a Nominee vehicle is used to hold the shareholders, so that only the name of the Nominee appears on the Shareholder Register and the Company’s Cap Table.  Therefore, if 300 investors invest in a crowdfunding campaign all of these investors will go into a Nominee structure and this Nominee will appear as one shareholder on the Shareholder Register and Cap Table.   


6. How do I decide on the pre-money valuation of my company?

Company valuations are subjective and depend on many factors, including Annual Revenues, Net Profit, Financial Projections, Achievements to date, Intellectual Property, Previous Valuations and, most importantly, the Track Record of the Management Team.  The company raising the funds makes the final decision about the pre-money valuation for a fundraising campaign.  Spark Crowdfunding has a number of small investor clubs who would be willing to offer a perspective on a proposed valuation prior to a campaign going live. 


7. What information do I need to provide before my campaign goes live?

Companies looking to launch a campaign on Spark must first complete our Campaign Application Form.  This is quite a lengthy document that sets out the progress the company has made to date, the profile of the promoters and the growth plans for the Company, together with financial projections.  This allows us to determine whether or not the Company is suitable for an equity crowdfunding campaign.  If the Company appears to have good prospects and is suitable for a Campaign we then request a range of Due Diligence documents, including a Tax Clearance Certificate, Memorandum and Articles of Association, Company Constitution, Cap Table, most recent Annual Audit and the promoter’s CVs. 


8. How do I promote my Equity Crowdfunding Campaign?

There are many ways in which a campaign may be promoted and we would be happy to assist entrepreneurs in preparing their strategy for this.  A good press release announcing the campaign is important.  The company’s own customers or users should also be invited to review the campaign and become a shareholder.  Email marketing is a low-cost way to approach this.  Social media marketing, using LinkedIn, Twitter and Facebook is also low-cost and easy to do.  Paid advertising on the social media channels and Google could also be considered.  In addition to the above, Spark holds regular investor evenings at which companies raising funds are given an opportunity to pitch.  Spark also arranges webinars where companies present their campaign to an online audience.    


9. What is the minimum an investor can invest?

This is at the discretion of the Company raising the funds, but we would recommend an amount of €100 as the minimum that an investor can invest in a campaign.


10. What is the difference between Equity Crowdfunding, Crowdlending and Rewards Crowdfunding?

Equity Crowdfunding involves selling part of your Company.  New shares are issued to outside investors based on the number of shares an investor purchases.  The disadvantage of equity crowdfunding is that the owners are selling part of their company, but the advantage is that the funds invested to not have to be repaid, nor does any interest need to be paid on the amount invested.  Crowdlending is where a group of lenders is assembled and these individuals lend money to the Company.  The funds need to be repaid, with interest, typically over 3-year period, but the company owners are not selling any shares in the business.  With Rewards Crowdfunding, the people who put money into the Campaign do not receive an equity shareholding in the company, nor are they making a loan that needs to be repaid.  Instead, they receive a reward, such as an early version of the product at a discounted price.  Spark Crowdfunding only offers equity crowdfunding and is the only company in Ireland to offer this service.   


11. Is Crowdfunding regulated in Ireland?

Crowdfunding is not yet a regulated service in Ireland.  It is our understanding that the Department of Finance is looking at the whole area of crowdfunding in Ireland and we believe a new regulatory framework will be introduced in the near future, a move that would be welcomed by Spark Crowdfunding and the crowdlending platforms in Ireland.  Spark Crowdfunding does not hold any funds on behalf of it clients, nor does it give any investment advice to its clients.  Additionally, Spark takes no trading risk and does not invest in any campaigns on its platform.     


12. How many investors does Spark Crowdfunding have?

New private investors are joining Spark every day and the company now has thousands of qualified investors on the database.   


If you are interested in signing up as an investor with Spark or would like to know more about raising funds for your business, please click on either of the buttons below: 


Beginners' Guide to Equity CrowdF...

Tags: Guide

Equity crowdfunding is a simple, low cost way for entrepreneurs and companies to raise money from a wide pool of investors to fund their new ventures.

A company posts its Project on the crowdfunding website and specifies how much money it is looking to raise and for what percentage of the company.  Entrepreneurs should think of their pitch as if they were going onto "Dragons' Den", highlighting the key reasons why someone should invest in their company.

Once the campaign goes live on the Spark Crowdfunding website, investors are invited to subscribe for shares in the company and can invest anything from €100 to €1 million.  The higher the investment, the more shares the investor receives.  

So, let’s say Acme Enterprises was looking to raise €1m in return for 40% of the equity in their company.  If someone invested €500,000 they would get 20% of the company or if someone invested €250,000 they would get 10% of the company.  Therefore, if someone invested €25,000 they would get 1% of the company.

Put simply, equity crowdfunding is a way for companies to raise money from a wide range of small to medium sized investors.  Campaigns typically run for 30-45 days, depending on how much the company is looking to raise, although campaigns that are close to reaching their target can be extended, at the discretion of the company raising the funds.  

The company must achieve its full target before a campaign completes 'successfully', although a higher amount than the initial target can be invested in the company.  The company pays no fees unless the campaign is a success.  The company pays a fee of 6% on funds raised - the investor pays nothing.  

Contact Spark Crowdfunding today if you would like to discuss any aspect of equity crowdfunding in Ireland.

If you are interested in signing up as an investor with Spark or would like to know more about raising funds for your business, please click on either of the buttons below: