Equity crowdfunding is one of the forms of investment available to companies that is becoming increasingly popular also in Trentino, an area rich in innovation where there is no lack of initiatives to support the best business ideas. The best way to explore the benefits of this financial instrument, which has innovated the way in which companies and start-ups raise funds, is to recount a concrete case of a Trentino company that has launched an equity crowdfunding campaign.
For this reason Invest In Trentino presents the story of CherryChain and the fundraising campaign promoted on the 200crowd platform.
CherryChain and Distributed Ledger Technology
CherryChain is a Trentino startup active in the "fintech" sector in which digital innovation optimises - and sometimes revolutionises - traditional financial services.
CherryChain, in particular, deals with research and software development in the Distributed Ledger Technology and Smart Contract fields, answering the increasingly evident need to transform the single business-customer relationship into an ecosystem of connections capable of strengthening the "digital trust" in the delivery of a service.
Since 2018, the startup has been based operationally within the Fondazione Bruno Kessler, a centre of excellence for research and innovation at an international level that hosts the European Institute of Technology (EIT Digital) as well as several market players, such as Stellantis, Engineering, GPI, Istituto poligrafico della Zecca dello Stato.
CherryChain and the equity crowdfunding campaign
[...] Equity crowdfunding is not only a formula for financing companies, but it is also a tool that can create a pool of new partners who are able to generate opportunities for the company that go beyond what can be achieved by the founders or industrial partners. In practice, a fundraising campaign can be used to achieve a number of goals, such as strengthening the company's positioning and increasing its visibility [...]
Carlo Rizzi, Co-founder and R&D Manager of CherryChain for Equitycrowdfunding.news
Growth, consolidation and innovation. CherryChain has activated the equity crowdfunding campaign to continue with a growth path that is already well underway (the company is owned by Banca Popolare dell'Alto Adige, Dolomiti Energia, Dettaglianti Alimentari Organizzati and Gruppo Bit4Id). Specifically, the goal is to raise the necessary capital to complete the features and User Experience of its application in order to focus on the expansion of the team - with particular reference to the marketing side - necessary to achieve the company's objectives.
For CherryChain, however, equity campaigns are not limited to the financial contribution but offer something more: it is only through this financial tool that it is possible to reach that plurality of subjects - citizens, workers, professionals interested in Distributed Ledger Technology - who, once engaged, can contribute significantly to the development of new projects and new products.
The campaign is active on the 200crowd platform until 18 March 2022 and can be reached at the following address:
200crowd.com/cherrychain
Equity Crowdfunding: when support for businesses becomes innovative
Trentino Sviluppo, a system company of the Autonomous Province of Trento with the specific mission of promoting the industrial development of local businesses, has started to support equity crowdfunding campaigns launched by companies established in Trentino in 2018. The mechanism is simple: as a certified incubator, Trentino Sviluppo is authorised to participate as an "institutional investor" in equity crowdfunding campaigns promoted - on Consob-authorised platforms - by companies based in the Province of Trento. The public investment in this type of campaign is 5% of the funds raised and is one of the fundamental conditions for validating the campaign.
The reason for this choice lies in the numbers: from 2018 to 2021, 15 campaigns have been supported with a public investment of about 148,000 euros, which allowed the companies to raise 3.3 million euros. A public leverage of 1:22 - each public euro invested generated a leverage effect of 21 euros on the private market - which demonstrates how the equity tool is truly effective in supporting startups in their search for the capital they need to validate their products, to incur research and development expenses and to enter the market.
