Support doubles for First Nations-owned Sobah in $1m equity crowdfunding raise

In total, Sobah raised double the amount on offer in a strong showing for the First Nations-owned company.  

However, funds the Gold Coast-based business can access are technically capped at $1 million; under the terms of Birchal, businesses can choose to offer beyond the expected goal amount with the option to buy in if other investors pull out before the final cut-off.  

Sobah co-founder Clinton Schultz said he had faced significant challenges in going through the usual investment channels, but the detour to crowdsourced funding had turned out to be a blessing in disguise.

“I didn't really know what kind of buy-in and feedback we were actually going to get so that was a bit nerve-racking for me, but it's been overwhelmingly positive, which has been a beautiful thing,” Schultz said.

“I was a bit hesitant at first, and that was nothing to do with crowdfunding itself. It was more to do with being a First Nations person, and as a First Nations business, we have different levels of discrimination at different times.

“Historically, First Nations businesses haven't necessarily been supported to the level that they should have been. There's almost this perception that we don't know how to handle money and do business.”

On a more positive note, he claimed this lack of private investment had allowed him to run the business on his own terms and make decisions that have ultimately been beneficial to the company.

“If I was going to have this large corporate entity, which Sobah is becoming and will continue to become, I had no interest in it just being for personal gain. That's not our way,” Schultz said. 

“Obviously, we still want to be a profitable business, but we actually want to prove that purposeful business is actually good business.  

“They shouldn't be seen as separate. You can do things in a far more equitable way, and a sustainable and socially responsible way.” 

Schultz says this social responsibility is embedded into the very fabric and organisational structure of Sobah. 

“We give our employees three days a year as wellness days. It's written into our ways here that nobody in this business is ever getting paid more than three times that of the lowest-paid employee,” he says.

“If we bring a CEO in here and they want to earn $150,000, they better figure out how I'm paying my warehouse guy $50,000.” 

The equity crowdfunding method has resonated with companies since Birchal’s inception in 2019, with a total of $30 million raised for companies in 2020 and $61 million in 2019. 

The platform’s success to date follows 62 per cent growth in equity crowdfunding across all Australian platforms in the last two years, suggesting a gradual move away from traditional avenues of raising funds like private investment and listing on public markets. 

Craft breweries, in particular, have found success within the crowdfunding format; Perth-based brewery Spinifex Brewing Co managed to raise $1.6 million on Equitise in a matter of days. 

Drinks market analyst IWSR forecasts that the no- and low-alcohol sector in Australia will grow by 16 per cent from 2020 to 2024. In 2020, the market for these beverages in Australia increased by 2.9 per cent, outperforming the growth of regular alcohol sales. 

Though data for investments in minority-owned businesses is scarce, equity crowdfunding has expanded the opportunities for those who might think of themselves as future owners – and democratises the process along the way. 

The investment type promises to create a stronger entry point for minority-owned businesses, with women-led founders accounting for 25 per cent of successful campaigns in 2020 according to Birchal. Though data does not yet exist for First Nations groups, a similar precedent could likely follow. 

“Everything that I do these days is informed through my Gamilaroi law. All the positive principles of that is what I use to guide the decisions that are made in both my personal and professional life these days,” Schultz said.  

“I strayed away from that for a long time in my life, and it did nothing to get me in trouble. Since I've allowed myself to return to viewing the world from that perspective everything is a lot more positive and a lot more beautiful.”