Whilst a CSF (Crowd-Sourced Funding) Offer Document is a legal requirement for Australian businesses raising capital, it can also serve as a valuable asset to convert investors during your capital raise.
Don’t treat your offer document as a mere compliance exercise. How you present your pitch reflects the care you put into your business, and the right approach could mean the difference between an investor committing $1,000, $10,000 or $100,000+.
A well-crafted offer document should tell your company’s story, highlight your competitive edge, and present financial details to give investors a holistic picture of the investment opportunity.
Ask yourself: Am I highlighting the most important points? Can investors quickly grasp the opportunity and access the information they need to decide? Is my message buried in a sea of text, or could a single clear graphic convey it more effectively?
At Social Startup Labs, we help a range of businesses from pre-revenue through to established international brands raise capital with Equity Crowdfunding.
Here’s how to balance transparency, storytelling, and compliance to maximise your chances of success for your raise.
1. Follow ASIC’s Compliance Guidelines
First and foremost, the Australian Securities and Investments Commission (ASIC) provides a structured template for CSF offer documents. Your document must be clear, factual, and meet the criteria set out by ASIC under the Corporations Act. In compliance with this, Offer Documents must be set out in 4 key sections.
Section 1: Risk Warning.
All Offer Documents must include a risk disclaimer outlining the potential for loss and that the investment is unlikely to be liquid. I.e. Investors may not be able to sell shares unless a liquidity event occurs.
Section 2: Information about the Company.
Key information about the Offering Company must be disclosed, including company details, a description of the business, capital structure, Directors and Senior Managers, Risks facing the business, and financial information including financial statements.
Section 3: Information about the Offer
Section 3, specifically relates to information about the offer including the terms, use of funds, rights associated with the shares, and details of any previous CSF offers.
Section 4: Information about Investor Rights.
The final section of the Offer Document sets out investor rights, including cooling off rights, communication methods for the company to shareholders, and any corporate governance concessions.
Whilst it’s great to talk about your business metrics, achievements and success, it’s important to note that under ASIC’s requirements you cannot include any projections or information that could mislead investors.
This means you should steer clear from including forward-looking financials, or any statements that can’t be proven to be correct at the time of publishing the document.
If at any time, you are unsure what to include within your Offer Document, please reach out to Issac, part of the friendly team at OnMarket - issac@onmarket.com.au.
2. Write a Letter from the Founder.
Whilst not a mandatory requirement under ASIC’s Offer Document template, a ‘Letter from the Founder’ can be a great way to introduce and pitch your equity crowdfunding raise.
The Letter from the Founder gives a short and succinct summary of the company, the leadership, traction to date, and key investment highlights to quickly inform and educate prospective investors. Think of the letter as a pitch on a page, as to why the investor should keep reading on.
Successful founder letters often include:
A strong opening hook, to grab the reader's attention.
Introduce the problem and solution - often this works best with a compelling story.
Share the journey so far including milestones and achievements.
Clearly explain why the raise is needed, and the use of funds raised.
Close with a strong call to action.
3. Create an ‘Investment Highlights’ section.
Most successful campaigns create a one-page ‘investment highlights’ section which can clearly provide investors with a list of the most compelling reasons to invest in one place.
Milestones and achievements to include in the investment highlights section can include:
Growth metrics (Revenue, customers, partnerships). E.g. “X% year-on-year growth.”
Founding team, advisory board, and credibility of the leadership. E.g. “X years in the Y industry, with 1 previous successful exit”.
Financial performance (Is the company profitable, is there an unusually high margin?)E.g. “X years in operation, profitable from Y date.”
IP or Competitive edge.E.g. “Approved Patents for X technology”.
An advantage of creating the ‘Investment Highlights’ section is that the actual page/s can be exported from the document and shared with prospective investors, circulated to your community, or reformatted as a graphic to sit on the intermediary’s raise page.
4. Structure Your Offer Document for Easy Reading.
When investors are considering your opportunity, one of the first things many will look at is your CSF Offer Document. By structuring your document correctly, it should help investors find useful and meaningful information, to better inform their investment decisions.
As mentioned earlier, ASIC stipulates specific Sections within the Offer Document, but it’s important to know that they form the minimum requirement of the contents.
At Social Startup Labs, we recommend introducing additional information (where relevant) that supports the narrative of your business and highlights information investors will want to read.
See the example below from a recent campaign where we added additional sections to improve the structure of the document based on information we knew investors wanted to learn more about.
Section Heading: | ASIC Required or Additional | |
Section 1: Risk Warning | ||
Section 2: Information about the Company | ||
2.1 Company Details | ASIC Required | |
2.2 Description of the Business. | ASIC Required | |
2.3 Business Strategy. | Additional | |
2.4 Business Model. | Additional | |
2.5 Capital Structure. | ASIC Required | |
2.6 Directors and Senior Managers. | ASIC Required | |
2.7 Key Business Risks. | ASIC Required | |
2.8 Financial Information | ASIC Required | |
Section 3: Information about the Offer | ||
3.1 Terms of the Offer | ASIC Required | |
3.2 Use of Funds. | ASIC Required | |
3.3 Investor Rewards. | Additional | |
3.4 Rights associated with the shares. | ASIC Required | |
3.5 What can I do with my shares? | Additional | |
3.6 Details of previous CSF Offers | ASIC Required | |
Section 4: Information about Investor Rights | ||
4.1 Cooling-Off Rights. | ASIC Required | |
4.2 Proprietary Company Corporate Governance Obligations. | ASIC Required | |
4.3 Communication facility for the offer. | ASIC Required |
So why add additional sections for the Business Strategy and Business Model? In this example, the company ‘Box Divvy’ has a unique business model, a key reason for their success to date, and therefore needed to be explained in detail. The most effective way to highlight the differences between Box Divvy and a traditional supermarket chain was through a clear visual comparison. By using diagrams or infographics, we could illustrate key distinctions such as supply chain efficiency and cost savings for consumers, making it easier for the investor to grasp the value of the model and potential growth at a glance.
Within the Business Strategy section, we worked with the company to demonstrate key performance metrics like Customer Acquisition Cost, Customer Growth Rates, and Customer Churn Rates, with diagrams and infographics - all of which complimented the forward moving narrative and provides investors with confidence that the company growth is stable and highly scalable.
Before you begin drafting your Offer Document, think about any specialist areas of your business that give you a competitive edge, or put you at the forefront of an industry. It’s important to explain to investors why your company is different from the rest, and is worthy of their investment in a format that is easy to digest.
Final Thoughts
A good CSF Offer Document will be compliant with ASIC’s guidelines, however, if you want to create material people actually want to read, you need clarity, engagement, and effective communication. By creating a compelling investor letter, clearly setting out your investment highlights, and structuring content for easy reading, you can attract the right investors to help your business achieve its goals.
Need any help? At Social Startup Labs, we provide resources and support to help you craft an investor-ready offer document as well as a range of capital raising and marketing services. Feel free to reach out for a 30-minute consultation with us here.
Pippa Smith,
Founder and CEO of Social Startup Labs