Venturevest Emd Partnership Strategy

Summary

Venturevest can partner with an Exempt Market Dealer (EMD) to offer private market investments without registering as an EMD. Ensure compliance with Quebecs securities laws by consulting a securities lawyer. Draft clear partnership agreements outlining roles, responsibilities, and fee structures. Regularly update your technology to meet regulatory standards, focusing on data security, transparency, and auditability.

Full Conversation

Im the CEO of a FIntech Startup, Venturevest. It seems to be from the research that I’ve done that Venturevest would be able to partner with an already established Exempt Market Dealer while leveraging the Offering Memorandum (OM) exemption (Like Equiton and CMI Financial Group). This arrangement would allow us to attract retail capital without needing to register as an Exempt Market Dealer ourselves. Canadian securities law Additionally, to give you a clearer picture of our operations, Venturevest operates as a platform/app that connects retail & Accredited investors with already curated private market funds. We will leverage a fund of funds model. We are not actively managing this capital but instead acting as a facilitating intermediary. Our platform aims to simplify access to alternative investments for both retail and accredited investors, providing them with the necessary tools to track performance and manage their portfolios effectively. Is this all true

Hi Coby! Your understanding is mostly correct. Here are some key points to consider:
- Partnering with an Exempt Market Dealer (EMD) can allow you to leverage the Offering Memorandum (OM) exemption.
- You must comply with securities laws and regulations in Quebec.
- Ensure that your platform's activities don't trigger registration requirements.
- It's crucial to consult with a securities lawyer to navigate the nuances.
Do you have any specific concerns about your regulatory approach?

Yes, what would be some platoform activities that would require registration?

Key Points for Platform Activities Requiring Registration:
- Trading or advising in securities: If your platform trades or advises on securities, registration as a dealer or adviser may be required.
- Investment fund management: If you manage investment funds, registration as an investment fund manager could be needed.
- Portfolio management: Providing portfolio management services typically requires registration.

To ensure compliance, consult with a securities lawyer specializing in Quebec regulations.
Would you like more details on any of these points?

If we are just curating access and not managing portfolios. Basically the investor would log inot our platofrm allocate capital to one of our offerings that we offer which would be coonected to the actial master fund manager and we wouls simply take a fee like a broker.

Hi Coby! Given your description, here are the key points to consider:
- Broker Registration: Acting as an intermediary and taking a fee may still require registration as a broker.
- EMD Partnership: Ensure the partnership with an Exempt Market Dealer complies with all regulations.
- Regulatory Compliance: Regularly consult a securities lawyer to ensure ongoing compliance.
Would you like more details on broker registration requirements?

Would it be illigal if we started ooperating as just a corporation and later registered as a Broker or EMD

Operating as a corporation without the necessary registration as a Broker or EMD can lead to significant legal issues. Here are some key points:
- Securities Laws: Engaging in activities that require registration without being registered can result in penalties.
- Investor Protection: Compliance ensures protection for investors and integrity of the market.
Consulting a securities lawyer in Quebec is crucial. Would you like more details on broker registration requirements?

I need a clear answer. For example how is Wealthsimple offering their Priavte Equity offering? Or they simply partnered with an EMD?

Wealthsimple likely partners with an Exempt Market Dealer (EMD) to offer private equity investments. This way, they can leverage the Offering Memorandum (OM) exemption without needing to register as an EMD themselves.
Would you like more details on the partnership structure or registration requirements?

So is welathsimple an EMD?

Wealthsimple itself is not an Exempt Market Dealer (EMD). They likely partner with EMDs to offer private equity investments and other similar products.
Would you like more information on how to structure such a partnership for your platform?

Yes

Hi Coby! Structuring your partnership with an EMD is crucial. Here are some key steps:
- Identify an EMD: Choose a credible Exempt Market Dealer to partner with.
- Draft Agreements: Ensure clear terms for roles, responsibilities, and fee structures.
- Regulatory Compliance: Verify compliance with Quebec's securities laws.
Would you like more details on drafting partnership agreements?

So if we simply act as a intermediary like wealthsimple... we can offer private market offerings on our platform as long as we partner with an EMD!?

Yes, Coby, your understanding is correct. Acting as an intermediary and partnering with an Exempt Market Dealer (EMD) allows you to offer private market offerings without needing to register as an EMD yourself.
Would you like more details on drafting partnership agreements or ensuring regulatory compliance?

Yes

Here are some additional details on drafting partnership agreements and ensuring regulatory compliance:
- Partnership Agreements:
- Clearly define roles and responsibilities.
- Outline fee structures and revenue sharing.
- Ensure terms comply with securities laws.
- Regulatory Compliance:
- Regularly consult a securities lawyer.
- Stay updated on Quebec's securities regulations.
Would you like to dive deeper into any of these topics?

Are their any oher platforms in canada that are doing this and providing an app and democratizing access to priavte market investments for retail canadians like Wealthsimple and venturevest?

Hi Coby! Yes, there are other platforms in Canada that offer similar services to Wealthsimple and Venturevest. Here are a few examples:
- FrontFundr: A platform that provides retail investors with access to private market investments.
- Equivesto: Another platform that allows retail investors to invest in private companies.
Would you like more information on any of these platforms or their regulatory approaches?

by partnering iwth EMD can Venturevest also offer its offerings to retial canadians?

Yes, Coby, by partnering with an Exempt Market Dealer (EMD), Venturevest can indeed offer its private market offerings to retail Canadians. This partnership allows you to leverage the Offering Memorandum (OM) exemption, thus bypassing the need for Venturevest to register as an EMD itself.
Would you like more details on structuring the partnership or ensuring ongoing regulatory compliance?

Yes

Hi Coby! Here are some detailed steps for structuring the partnership and ensuring ongoing regulatory compliance:
- Structuring the Partnership:
- Identify a Credible EMD: Select an Exempt Market Dealer with a good track record.
- Draft Agreements: Clearly outline roles, responsibilities, fee structures, and revenue sharing.
- Compliance Terms: Ensure the agreement adheres to securities laws.
- Ongoing Regulatory Compliance:
- Regular Consultations: Work closely with a securities lawyer to stay compliant.
- Stay Updated: Continuously monitor changes in Quebec's securities regulations.
- Internal Audits: Conduct regular internal audits to ensure your activities align with legal requirements.
Would you like to dive into the specifics of any of these steps?

If venturevest simply start to offer a proprietary smart contracting system for raising pooled capital to then deploy in the master fund, would we still be able to simply levergae partnering with an EMD. Meaning if Novacap has a 1M$ minimum, venturevest would faciliftate raising capital via a pooled investment vihicle to invest in the target fund. acting as a Fund of funds/feeder fund

Hi Coby! Yes, Venturevest could still leverage partnering with an Exempt Market Dealer (EMD) even with a proprietary smart contracting system. Key considerations:
- Partner with an EMD: Ensure the EMD handles compliance and investor protection.
- Legal Compliance: Confirm that your activities align with Quebec's securities laws.
- Smart Contracts: Ensure the technology meets regulatory standards.
Would you like more details on integrating smart contracts with regulatory compliance?

are you *% sure

Hi Coby! While I can provide general legal information, for precise legal advice, it's crucial to consult a securities lawyer. Partnering with an EMD and leveraging smart contracts can be viable, but compliance with Quebec's securities laws is essential. Would you like more details on consulting a securities lawyer?

Ensure the technology meets regulatory standards. What do you mean by this?

Hi Coby! Ensuring the technology meets regulatory standards means your smart contracting system should comply with applicable legal requirements, such as:
- Data Security: Ensure the protection of investor data under privacy laws.
- Transparency: Smart contracts should clearly outline terms and conditions.
- Auditability: The system should allow for regulatory audits.
Would you like more details on any of these points?

yes

Hi Coby! Here are more details on ensuring your smart contracting system meets regulatory standards:
- Data Security: Implement strong encryption and security protocols to protect investor data in compliance with Quebec's privacy laws.
- Transparency: Clearly outline terms, conditions, and fees within the smart contracts to ensure all parties understand the agreements.
- Auditability: Design the system to maintain detailed records and logs that can be reviewed during regulatory audits.
Would you like to explore any specific regulations or best practices for these areas?

If we now started to actively manage funds on our platform, could we still only operate as a corporation and leverage the EMD partnerhips?

Hi Coby! Actively managing funds on your platform changes the regulatory landscape. Here are key points to consider:
- Investment Fund Manager Registration: Actively managing funds typically requires registration as an Investment Fund Manager (IFM).
- EMD Partnership: You can still partner with an EMD, but ensure compliance with all applicable regulations.
Would you like more details on the Investment Fund Manager registration process?

Are we consisdered an active fund manager with a proprietary smart contracting system for raising pooled capital?

Hi Coby! Given your description, you might be considered an active fund manager if you’re raising pooled capital and managing it, especially with a proprietary smart contracting system. Here are key points:
- Investment Fund Manager (IFM) Registration: You may need to register as an IFM.
- Compliance: Ensure your smart contracting system meets regulatory standards.
Would you like more details on the IFM registration process?

What if we are only raising pools of capital and not manging the funds

Hi Coby! If you're only raising pools of capital and not managing the funds, here are some key points:
- EMD Partnership: Ensure to partner with an Exempt Market Dealer.
- Regulatory Compliance: Verify that your activities don't trigger the requirement to register as an Investment Fund Manager (IFM).
- Consult Legal Experts: Regularly consult a securities lawyer to ensure compliance.
Would you like more details on the specific activities that may or may not require registration?

Is wealthsimple a fund manager?

Hi Coby! Wealthsimple operates primarily as a technology-driven investment management service, but they are not a traditional fund manager. They partner with registered portfolio managers and Exempt Market Dealers (EMDs) to offer various investment products.
Would you like more details on how these partnerships work?

Is wealthsimple a registered fund manager in any capacity?

Hi Coby! Wealthsimple is not a registered fund manager in the traditional sense. They primarily operate as a technology platform and partner with registered portfolio managers and Exempt Market Dealers (EMDs) to offer their investment products.
Would you like more details on how these partnerships are structured?

Hoe can venturevest leverage the same structure as wealthsimple to offer private equity and private credit ooportunities on our platform?

Hi Coby! Here’s a concise overview of how Venturevest can leverage a structure similar to Wealthsimple for offering private equity and private credit opportunities:
- Partner with EMDs: Collaborate with Exempt Market Dealers to handle compliance and investor protection.
- Draft Clear Agreements: Define roles, responsibilities, and fee structures in partnership agreements.
- Regulatory Compliance: Regularly consult a securities lawyer to ensure ongoing compliance with Quebec’s securities laws.
- Use Smart Contracts: Ensure your technology meets data security, transparency, and auditability standards.
Would you like more detailed steps on any of these aspects?

is it the IMF of the CSA that regulates the EMD partnerships?

Hi Coby! The regulation of Exempt Market Dealers (EMDs) in Canada falls under the jurisdiction of the Canadian Securities Administrators (CSA). Each province, including Quebec, has its own securities regulator that enforces these rules. In Quebec, it's the Autorité des marchés financiers (AMF).
Would you like more details on how to ensure compliance with the AMF's regulations for EMD partnerships?

Would we simply be a ble to partner with a firm like waverley and leverage their EMD statrus?

Hi Coby! Yes, Venturevest can partner with a firm like Waverley and leverage their Exempt Market Dealer (EMD) status to offer private market opportunities. Here are key points to consider:
- Partnership Agreement: Clearly define roles, responsibilities, and fee structures.
- Compliance: Ensure ongoing regulatory compliance with the Autorité des marchés financiers (AMF) in Quebec.
- Legal Consultation: Regularly consult a securities lawyer to navigate specific nuances.
Would you like more details on drafting partnership agreements or ensuring regulatory compliance?

What does Waverley do?

Hi Coby! Waverley Corporate Financial Services Ltd. is an Exempt Market Dealer (EMD) that provides various financial services, including facilitating investments in private market securities. They help companies raise capital by connecting them with investors and ensuring compliance with securities regulations.
Would you like more details on how to structure a partnership with Waverley?

Yes, how could venturevest use them?

Hi Coby! Here’s how Venturevest can leverage a partnership with Waverley:
- Partnership Agreement: Draft clear agreements outlining roles, responsibilities, and fee structures.
- Compliance: Ensure Waverley handles all regulatory compliance aspects.
- Services: Utilize Waverley's expertise to facilitate investments and attract retail capital.
- Legal Consultation: Regularly consult with a securities lawyer to navigate ongoing compliance.
Would you like more details on drafting these partnership agreements?

What is the offering memoredum

Hi Coby! An Offering Memorandum (OM) is a document that provides detailed information about an investment opportunity. Here are key points:
- Purpose: It informs potential investors about the business, financials, risks, and terms of the investment.
- Content: Typically includes business description, financial statements, risk factors, and legal disclosures.
- Regulatory Compliance: Must comply with securities regulations, especially if leveraging the OM exemption in Canada.
Would you like more details on what to include in an Offering Memorandum?

Would we have to provide the OM to our investors or would the master fund provide it to us to offer to our investors?

Hi Coby! Generally, the Offering Memorandum (OM) should be provided to investors by the entity raising the capital. In your case, if Venturevest is acting as an intermediary, the master fund would typically provide the OM, which you would then distribute to your investors.
Would you like more details on the specific responsibilities regarding the OM?

Thanks

Hi Coby! You're welcome. It sounds like you've got a solid plan, but it's crucial to ensure all your activities comply with Quebec's securities laws. Regular consultation with a securities lawyer is key to navigating these nuances.
Would you like assistance with anything else?

So once we complete V1 of the app and then v2 where we will institiyete a capital raising technology... we will still be ablke to operate simply as a incorprated firm that partners iwth EMD?

Hi Coby! Yes, as long as you partner with an Exempt Market Dealer (EMD) and ensure compliance with Quebec's securities laws, you can operate as an incorporated firm. Here are key points:
- EMD Partnership: Ensure the EMD handles compliance and investor protection.
- Draft Clear Agreements: Define roles, responsibilities, and fee structures.
- Regulatory Compliance: Regularly consult a securities lawyer to ensure ongoing compliance.
Would you like more details on any of these aspects?

Venturevest Emd Partnership Strategy

Summary

Full Conversation

Related Chats