Venture Capital Board (VCAP)
The Venture Capital matching system is a stand-alone market for Entrepreneurs to list their company in a compliant format to “offer” securities in their company to a group of investors that have subscribed to the Crowd Funding and Venture Capital Seed Funding platform SASeedX (South African Seed Capital Exchange for Private Equity Financing) at www.saseedx.com. A Venture Capital Company (VCAP) is an issuer that is considered to be a start-up company, with little or no operating history, but that has the potential for high growth and high returns for investors. A listing on the VCAP Market enables the issuer to “sell” or “offer” the companies’ shares to sophisticated and exempt investors. Matching companies with investors enables the companies to become funded in a compliant and regulated format that gives additional security to the private equity investor. All funds raised in the VCAP listing must be placed in an approved escrow or trust account, and outward transactions must obtain approval of both the issuer and the Sponsor Advisor according to the funding milestones timetable submitted as part of the listing documents. The VCAP listing model was designed to provide a level of protection for both the issuer and the investors. The issuer is protected since it has a guarantee that the funds raised will be made available subject to it achieving its milestones. At the same time, because the funds are released based on certain pre- defined milestones, it also protects the investors by ensuring that the issuer sticks to its plans, timetables and forecasts. Extending milestones requires shareholder approval. Once an Issuer has reached its milestone investments on the VCAP Board and funding portal the Issuer may move respective public markets.
- A Venture Cap Board compliant Prospectus document which must not be older than 4 months as a Prospectus lapses after a period of four months in terms of Section 107 of the Companies Act.)
- The Company must engage a Sponsor Advisor, External Auditor, and Company Secretary and a responsibility statement by each service provider
- A registered company and corporate address with a Bank Account
- A minimum of two Directors in fulltime employment
- A responsibility statement by all Directors
- A minimum of 15% (fifteen percent) of the issued shares must be held by public shareholders by a minimum of 5 public shareholders (Not including Directors, Employees, affected persons of the Sponsor Advisor and issuer.
- Shareholder disclosure requirements of substantial shareholders
- Sponsor Advisors and their affected persons and affected employees may not own more than 20% (twenty percent) of the issued share capital of a company
- All VCAP companies in their Pre-listing Statement and prospectus must disclose their funding milestones as agreed with their Sponsor Advisor
- Five-Years financial forecast by the company and annual financial statements if available(No profit history is necessary, but the issuer must be able to show in its pre-listing statement and Prospectus that it’s future earnings and returns on capital are credible and produce five-year cashflow forecasts to support this)
- No interim financial reporting requirements
- A Lock-in policy shall apply to substantial shareholders, employees, and affected persons of the issuer, and will be observed until all its funding in milestones have been met to the satisfaction of the Sponsor Advisor and the Admissions Listing Committee, which may be extended or changed by an ordinary resolution at a General Meeting by shareholders who are not subject to the lock-in period.
- A closed period pertains to the final milestones as defined in the Prospectus and it satisfies the requirements for listing on the VCAP Board
- The Memorandum of Incorporation and any other constitutive documents must authorize the issuer to issue and apply for the listing of its Securities
- The standard authorized shares encouraged and recommended is 100 (one hundred) million authorized shares or greater (no par value)
- All shares listed must be freely transferable
- The issuer must have the appropriate settlement procedures in place for that particular class of security (eligible for electronic settlement)
- Subject to website disclosures as described within the Listing Requirements
- Documents admissions are in English unless otherwise agreed
- All securities must have an ISIN number
- A Listings Notice
Disclosure and Reporting Requirements
- A Fundamental Transaction as defined in the Listing Requirements, in the opinion of the issuer and the Sponsor Advisor, it exceeds a 50% change in the assets of the issuer.
- A disposal of 50% (fifty percent) of a Listed Security or 50% (fifty percent) of the assets of a company listed
- A clear disclaimer is made with regards to the inherent risk attached to early stage companies
- All Correspondence and disclosure by the issuer must first be provided to the Sponsor Advisor who will ensure its disclosed in the right manner and submitted to the Head of the Market Supervision and Compliance with regards to:
- financial positions
- current performance
- expected future performance
- any transaction by a substantial shareholder affected employee/person
- resignation or dismissal of a Director, Company Secretary or External Auditor
Fees are based on capitalization and Initial due diligence fee.
If you are interested in listing your company on the VCAP Board for offering securities to the Venture Capital and Sophisticated investor market, please contact firstname.lastname@example.org