Question 1 Case Scenario Amelia, Jane, and Cybil have been close friends since primary school where they bonded over their shared love for protecting the environment and for creating spectacular clothing items using recycled items found at charity shops. Fast-forward to 2020, and by this stage, the three friends had graduated university and were making plans to launch their own eco-friendly fashion brand. Amelia graduated with a degree in finance and holds an Australian Financial Licence, Jane graduated with a business degree, while the artistic Cybil, graduated with a degree in fashion design. On the advice of a solicitor, the three friends registered a small proprietary company called Fiercely Eco Pty Ltd. According to the ASIC database, the two business minds, Amelia and Jane, are listed as the companys two directors, while all three friends are listed as equal shareholders. Despite their ambition and hard work, the three friends lacked the finances to invest in and grow their business. Fortunately, their remarkable talent allowed them to acquire over a million loyal followers on social media after a video of Cybils creative process went viral on Tiktok. The question you must answer for 6 marks: Discuss whether the various crowdfunding strategies could be viable fundraising options to enable Fiercely Eco Pty Ltd to raise the capital it needs to grow. Also discuss reasons why alternate fundraising options like debt capital may not be a viable alternate option for the company at this early stage. Note: Answers must include references to the rules and restrictions contained in the Corporations Amendment (Crowd-sourced Funding for Proprietary Companies) Act 2018 See the Week 2 lecture slides

ANSWER STRUCTURE Question 1: Crowdfunding options Introduction: To enable Fiercely Eco Pty Ltd to raise the capital it needs to grow, the company can rely on the various crowdfunding options available online. Explain what crowdfunding is.. Option 1: Donations Explain: Discuss what this is/ how it works/ give examples of popular platforms. (Do not refer to Fiercely Eco here) Analysis: Here we are told that (Discuss how this option can work for Fiercely Eco.. they have lots of followers.. ) Option 2: Investments Explain: Discuss what this is/ how it works/ give examples of popular platforms Law: According to Corporations Amendment (Crowd-sourced Funding (Discuss the legal rules contained in this legislation e.g. what are the legal requirements companies should be aware of if they choose this option. (Do not refer to Fiercely Eco, only explain the law) Analysis: Here we are told that.. Discuss how these legal rules will impact on Fiercely Eco.. how can they achieve success using this option? Again, lots of followers. How is this method different to Option 1? More complicated? More work involved? More risk?

Alternate Options: Explain: Briefly discuss what other options are available to raise capital Analysis: Explain why these options may not be suitable for Fiercely Eco

Conclusion: It is clear that the most preferred method (Explain which crowdfunding option you would recommend for Fiercely Eco, explain why. Borrow words from the essay question in your conclusion to ensure you answer the question directly and clearly)