Australian wholesale investor criteria

Your eligibility to invest

Snowball Effect is offering the opportunity for Australian investors who meet certain criteria to invest in growing New Zealand businesses.

For regulatory reasons, the offers to Australian wholesale investors on Snowball Effect’s Australian platform are restricted to “sophisticated investors” and “professional investors”. The terms “sophisticated investor” and “professional investor” are defined in the Corporations Act 2001. Please see the Act for more information.

Through verifying yourself as falling within one of these categories, you will be able to access unique investment opportunities. Please note, offers made to wholesale investors may afford lower levels of investor protection than otherwise provided by licensed offers.

How is an Australian wholesale investor defined?

You will be able to obtain access to offers made through Snowball Effect by meeting the criteria of 1 or more of the following options:

You are a Sophisticated Investor, or;

You provide the following certificate signed by a qualified accountant from the past two years before engaging with Snowball Effect stating:

You have net assets of AUD$2.5million or;
You have a gross income of the last 2 financial years of at least AUD$250,000 per annum

You control gross assets of at least AUD$10 million, or;

A person who has or controls gross assets of at least AUD$10 million (including any assets held by an associate or under a trust that the person manages)

You intend to invest more than AUD$500,000 in a single offer, or;

You are a Professional Investor.

You provide the following certificate to Snowball Effect, stating you meet one of the following:

An Australian Financial Services Licensee
A body regulated by APRA, other than a trustee of a superannuation fund, an approved deposit fund, a pooled superannuation trust or a public sector superannuation scheme
A body registered under the Financial Corporations Act 1974
A trustee of a super fund, approved deposit fund, pool superannuation trust, or a public sector superannuation fund where the fund, trust or scheme has net assets of AUD$10 million
A person that controls at least AUD$10 million (including an amount held by an associate or under a trust that the person manages)
A listed entity or related body corporate of a listed entity
An exempt public authority
A body corporate or unincorporated body who invests in financial products, interests in land or other investments and invests fund received (directly or indirectly) following a public offering the terms of which provided for the funds to be invested for those purposes
A foreign entity that, if established or incorporated in Australia, would be covered by one of the preceding paragraphs

Australian Securities and Investments Commission (ASIC) issued warning

The information contained in this Publication (including this website) about the proposed business opportunity and the securities or scheme interests is not intended to be the only information on which the investment decision is made and is not a substitute for a disclosure document, Product Disclosure Statement or any other notice that may be required under the Corporations Act 2001 (Cth), as that Act may apply to the investment. Detailed information may be needed to make an investment decision, for example: financial statements; a business plan; information about ownership of intellectual or industrial property; or expert opinions including valuations or auditors' reports.

A prospective investor is strongly advised to take appropriate professional advice before accepting an offer for issue or sale of any securities or scheme interests.

Please read on

Snowball Effect warning

Please understand the characteristics of this platform.

Companies making offers through Snowball Effect will range from very early stage businesses with little more than an idea, to more established businesses that may already be profitable. The risk of investing in a business tends to decrease as a business develops and matures. For very early stage businesses, history suggests that perhaps only one or two out of ten will make significant returns for investors. Despite the hopes and belief of the promoters, some will putter along without much happening for a long time. In others the total investment could be lost.

Investing in early stage businesses is risky. Overall, investor returns tend to be greater than the amounts invested, but you might not be one of the winners. Some of the other key risks include:

Loss of capital – You could lose your entire investment.
Illiquidity – There is no guarantee that you will be able to sell your shares when you want to, or at all. Currently, there is no recognised secondary market for trading shares in companies funded by equity crowdfunding. Buying and selling among existing shareholders is generally lawful, but some companies may not facilitate it. We expect that open market trading facilities will eventually be authorised, but that is not certain at this time.
Lack of returns – Few early stage unlisted businesses pay dividends. They tend to reinvest what they earn in the growth or survival of the business.
Dilution – Companies may need more funding to grow or to survive. If they issue further shares, your share of the company will reduce unless you put up your proportion of the new investment. That reduction is called dilution.
Material events – Early stage businesses are often small and have narrowly focused offerings. This can increase the vulnerability of the business to internal and external threats, and make it harder to absorb material events such as loss of key staff and customers.
Lack of control – As a minority shareholder, you may have little influence on how the company develops. Companies are ruled by simple majority for most decisions. For example, you will not determine who the directors are unless the majority of shareholders who vote on an issue agree with you.

To decrease exposure to the risks, these types of investments should only be made as part of a diversified portfolio. Spread your risks. Only invest money that you can afford to lose.

Remember that you will never get enough information to know in advance how things will turn out. No one, even the directors of a company, can know in advance with 100% certainty just what will make a business fly, and what will bring it down. Even in large public offerings the information available is never enough to be sure how the future will turn out.

Please seek independent advice if you don’t fully understand the characteristics of this marketplace or the information in an offer.

Australian wholesale investor criteria

Your eligibility to invest

How is an Australian wholesale investor defined?

You are a Sophisticated Investor, or;

You control gross assets of at least AUD$10 million, or;

You intend to invest more than AUD$500,000 in a single offer, or;

You are a Professional Investor.

Australian Securities and Investments Commission (ASIC) issued warning

Snowball Effect warning

Offers

Learn

About

Legal

Australian wholesale investor criteria

Your eligibility to invest

How is an Australian wholesale investor defined?

You are a Sophisticated Investor, or;

You control gross assets of at least AUD$10 million, or;

You intend to invest more than AUD$500,000 in a single offer, or;

You are a Professional Investor.

Australian Securities and Investments Commission (ASIC) issued warning

Snowball Effect warning

Offers

Learn

About

Legal

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