Here’s some exciting crowdfunding news: We’re pleased to announce that we’re the first crowdfunding platform in the world to offer Crowdfunding Fidelity, a crowdfunding insurance policy from American International Group (AIG) that protects investors against issuer theft.
Over the past months, we have been collaborating with AIG, one of the world’s leading insurance providers, by providing insights on the global crowdfunding industry and opening up the hood to our inner technical workings, as they worked to build out this innovative product. We were chosen by AIG to work on the product because of the strength of our systems and global positioning, which AIG wanted to learn from, given that they intend this to be a global product.
So what isCrowdfunding Fidelity?
Crowdfunding Fidelity insures investors using the Eureeca platform against instances in which an employee of a company that has raised money on Eureeca steals the funds and the company goes under as a result. If investors’ capital is stolen, rather than used to grow the business as it should be, then they have their orginal investment amount compensated by AIG.*
The policy premium is built into our nominee structure package, which is becoming the go-to investment chosen by entrepreneurs using the Eureeca platform (only deals using the nominee will be covered by the policy). This means that Crowdfunding Fidelity coverage is free for investors. If only it was like that with car insurance.
While there have been very few instances of issuer theft in the crowdfunding industry globally, and certainly none on Eureeca, this is an exciting product because it shows the evolution and maturation of the space. Equity crowdfunding is now a sector that has global giants like AIG building and marketing products specifically for it. In other words, it is an clear indication that equity crowdfunding is the future of finance.
And at the end of the day, no amount of due diligence can predict whether or not a business employee will get greedy (and rather daring) and make off with investors’ hard-earned money. No platform can make that 100% guarantee. Now, at least, there is protection for that possibility, no matter how unlikely it may be.
*Terms and conditions apply.