Equity crowdfunding intermediary Enable has launched its first transaction under the new retail crowed sourced funding regime, with an offer from artificial intelligence start-up Zimpla.
Zimpla uses AI to develop algorithms that search job CVs to compile a shortlist of candidates. The company produced a prototype in 2016 and has been trialling it with prospective customers since then.
Zimpla co-founder and chief executive Damien Roache says the target market is recruitment companies and employers.
He says the business case is that recruiters and employers get inundated with CVs. Sifting through applications to create a shortlist of suitable candidates can take days, tying up management time.
And because the process is slow, there is a risk that the best candidate will have taken up another opportunity in the meantime.
Co-founder and chief operating officer Virginia Heyer says some recruiters use automated processes now but their systems tend to be crude – largely relying on keyword searches for obvious things like job titles.
“Our system goes through the whole resume and builds a picture of the applicant. AI in recruitment is in an embryonic phase and there are only a couple of other players doing what we do,” Heyer says.
Roache says: “Over the past 10 years, time to hire has doubled. That is because recruitment companies and employers are getting more CVs and they have more data to process. On top of that, people change jobs more often than they used to. Systems have not kept up.”
Roache and Heyer have some other long-term goals, including a consumer version of their product, where people can post their CVs, and partnerships with overseas groups.
They are seeking a minimum of $800,000 through the Enable platform and will close the fund raising at $2 million. Investors can buy equity for a minimum of $250. If the fund raising does not reach the minimum, the funds are returned.
Enable is one of seven companies licensed by the Australian Securities and Investments Commission earlier this year to act as equity crowdfunding intermediaries under new crowd-sourced funding rules, which have opened up the market to small investors.
The others are Equitise, Birchal, OnMarket, Big Start, Billfolda and Capital Labs.
Under the new rules, small investors are able to invest up to $10,000 per company per year via an intermediary platform.
Platforms can only be operated by licensed intermediaries that have specific authorisation to provide a crowdfunding service.
Unlisted public companies can use crowdfunding platforms to raise up to $5 million a year by issuing ordinary shares. To be eligible they must have less than $25 million in assets and annual revenue.
Investor protections include a 48-hour cooling-off period, a prohibition on offers of financial assistance to enable investments in offers, and a requirement to obtain a risk acknowledgment prior to accepting an application.
Platform providers must act as “gatekeepers” – checking company details and investment information before placing the offer on the platform.