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Navigating Security Regulations in Canada

Startup Talk · February 18, 2025

Navigating Security Regulations in Canada with Alex Morsink of Equivesto In episode 198 of the Startup Talk Podcast, we delve deep into the complexities of navigating security regulations in Canada with Alex Morsink, Managing Director of Equivesto, an equity crowdfunding platform. As startups consider strategies for growth and possible transitions to public trading, understanding the […]

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Navigating Security Regulations in Canada

Navigating Security Regulations in Canada with Alex Morsink of Equivesto

In episode 198 of the Startup Talk Podcast, we delve deep into the complexities of navigating security regulations in Canada with Alex Morsink, Managing Director of Equivesto, an equity crowdfunding platform. As startups consider strategies for growth and possible transitions to public trading, understanding the nuances of securities regulation becomes critical. Alex shares insights into the timing of going public, the benefits of retaining control over share trading, and strategies to maximize investor interest.

Key Discussion Points:

  • Understanding Securities Regulation: Alex explains the importance of startups aligning their fundraising and trading strategies with regulatory frameworks.
  • The Right Time to Go Public: Why going public prematurely can create challenges and how to prepare for a successful transition at the right stage.
  • Maintaining Control and Building Demand: Analogies like the McRib and Pumpkin Spice Latte are used to highlight how controlling trading opportunities can create excitement and value for your shares.
  • Avoiding Pitfalls: The risks of micro-public companies and how strategic planning can mitigate these challenges.

Highlights from the Episode:

  1. Regulatory Complexity: Alex emphasizes the need for startups to work with legal counsel and investment banks when preparing for public transactions.
  2. Valuation and Investor Liquidity: Insights on why controlling share trading can help maintain a favorable valuation and ensure better outcomes for founders and investors.
  3. Building Investor Excitement: Creating scarcity and timed opportunities to generate buzz and interest in your company’s shares.

About Alex Morsink and Equivesto:

Alex Morsink is the Managing Director of Equivesto, an equity crowdfunding platform that empowers startups to raise capital while adhering to Canadian securities regulations. His expertise in navigating these frameworks makes him a trusted advisor for startups considering growth strategies.

Connect with Alex Morsink and Equivesto:

Why Listen to This Episode?

This episode is a must-listen for startup founders and entrepreneurs navigating securities regulations in Canada. Alex’s practical advice and relatable analogies provide actionable takeaways to help startups make informed decisions about when and how to go public.

Make sure to subscribe to Startup Talk Podcast for more episodes filled with insights and expertise from industry leaders.

Additional Links
• Silicon Scoop Podcast – Stay Informed, Stay Ahead!
• Futuretech Podcast – Explore more episodes and stay updated with the latest in technology and innovation.
• Startup Talk Podcast – https://torontostarts.com/startup-talk-toronto-startup-podcast/
• Who Are These Startups Podcast
• Startup Investor Drinks – Join the community and connect with fellow startup enthusiasts and investors.
• TorontoStarts Startup and Entrepreneur Community – Become a part of Toronto’s thriving startup ecosystem.
• Workhaus – Discover flexible workspace solutions for your business needs.
• Work with The Startup Coach – Get expert guidance and mentorship for your startup journey.
• Reach out to Jon Irwin on LinkedIn – Connect with our co-host and technology expert.

Ontario Startup Ecosystem Links

• Ontario’s Startup Ecosystem
• Startup Funding in Ontario
• Angel Investors in Ontario
• Ontario Incubators and Accelerators
• Venture Capital in Ontario: Top Firms, Sectors, and Funding Strategies
• Government Grants for Ontario Startups
• Ontario’s Startup Success Stories
• Ontario Centre of Innovation (OCI)
• Bank Loans and Financing for Startups in Ontario
• Research and Development Tax Credits in Ontario
• Government Loans and Financing for Startups in Ontario
• Equity Crowdfunding for Ontario Startups
• Toronto Entrepreneurs Resources
• Toronto’s Food and Beverage Entrepreneurs: Trends, Challenges, and Success Stories
• SEO Strategies for Toronto Entrepreneurs: Enhance Your Online Visibility
• Social Impact for Toronto Entrepreneurs: Starting and Running a Socially Responsible Business
• Toronto Arts and Media Entrepreneurs: Inspiring Profiles and Insights for Creative Success
• Exploring Toronto Green Tech Entrepreneurs: Innovators and Leaders in Sustainability
• Building a Team for Toronto Entrepreneurs: Strategies for Success
• A Guide for Toronto Food and Beverage Entrepreneurs
• Toronto Fashion and Retail Entrepreneurs: Trends, Opportunities, and Success Stories

Episode transcript

Read the full transcript

Speaker 0: how should startups navigate the complexity of securities regulation if they plan to go public in the future?

Speaker 1: oh, so i would not recommend going public on your own. pretty much every public transaction involves not only legal counsel, but also an investment bank, certainly when you get larger. one of the things that sometimes kinda gets, like, overlooked a little bit is people think that you wanna go public as quickly as you can. because as soon as you go public, now your shares are trading. you can have some liquidity for yourself as a founder. you can have liquidity for the investors who invested. that's all great. that can be the case. but what you wanna also keep in mind is as soon as you go public, people can now engage in secondary trading of your shares of which you have no control over anymore. and so i like to compare it to, like, the mcrib, from mcdonald's or pumpkin spice lattes from starbucks. when your company is smaller, if you're maintaining control over when the shares can be bought or sold, one. two, that they're always being bought or sold from you as the company. and three, you can set the valuation at the time that it takes place. it puts you in a much better control position, and you can build excitement for that future moment when it becomes available for investment. the mcrib and the pumpkin spice latte are only available for limited times each year. what that does is it helps build up demand and excitement from the consumer. you could have a pumpkin spice latte all the time. maybe you'd have one or two in the fall, but you wouldn't feel the desire to have one on september fifteenth as strongly as you would if they were only available from september first to december tenth or whenever they stop being available. same with the make red. right? it's only available few times a year. people get very excited. they are wanting and waiting for the opportunity to be able to have one. if your company is always trading, then it's as if it's never trading. there's never that moment of excitement, and you can't control and set the price. people are gonna buy and sell. and if some random investor really needs to get out, they can just lower their price further and further and further down to try to find a buyer, which can tank your whole stock. so going public is a very, very useful tool. i typically recommend saving it for a larger and later stage business rather than saying, what's the soonest we can go public? and then kinda getting stuck in this kind of quagmire of, like, micro public companies where you're public, but there's not necessarily a ton of interest in what your business is doing.

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