Ready to launch your Financial Services business?
Updated: Mar 7
I wish I had a dollar every time I saw an email pop up with the subject line "is your AFSL for sale?" !!!! As a team, we know what it's like... we've been there... you've got an exciting plan to launch a new fund or financial service but the reality of compliance and ASIC regulations quickly takes the wind out of your sails and sadly buying someone else's AFSL is not an option.
If you're currently operating outside of Australia, let me just explain first of all.. an AFSL is a license issued by the Australian Securities and Investments Commission (ASIC) that authorises a company or an individual to provide financial services to clients in Australia. It is a personal license that is granted based on the skills, knowledge, and experience of the licensee.
While an AFSL can be transferred in certain situations, such as when a business is sold or the licensee passes away, it cannot be bought or sold outright. Any change in ownership or control of the licensee requires approval from ASIC, which assesses whether the new licensee is fit and proper to hold the license and whether they meet the necessary regulatory requirements.
Therefore, while you can acquire a business that holds an AFSL, you cannot purchase the AFSL itself as it is not a tradable asset. Instead, you would need to apply for a new AFSL in your own name or transfer the existing AFSL with ASIC's approval.
Remember you have options... you can start the application process to apply for your own AFSL and then in the meantime, use an AFSL for rent or Authorised Representative type arrangement. This could be an interim stop gap until you receive your own AFSL... or as some of our clients here at Avenir Capital have discovered, they prefer to actually work this way long term. Why is that?
Operating under a credible, established AFSL for rent/for hire provider provides credibility and legitimacy to the investment fund, which can in turn, attract investors and increase the likelihood of success.
It can simplify the process of raising capital and entering new markets, as it demonstrates that the investment fund is regulated and compliant with the relevant regulations.
Obtaining your own Australian Financial Services License (AFSL) can be a time-consuming process, which then can slow down the start of your new investment fund. You'll have to...
Complete the necessary applications and forms.
Gather and provide evidence of financial stability and compliance with all regulatory requirements.
Demonstrate a clear understanding of the investment products and services offered.
Participate in an on-site examination by ASIC.
This may be an option for you down the track and reducing the time you need to spend on compliance means that you can focus on those other essential aspects in launching your financial services business, namely...
Target market: Define your target market and identify their needs and pain points. Ensure that the products and/or services you're offering addresses these needs and differentiates you from your competitors.
Value proposition: Clearly articulate your value proposition and how your products and/or services will solve your customers' problems or meet their needs.
Branding and marketing: Establish a strong brand identity and develop a marketing strategy that effectively reaches your target audience.
Infrastructure: Set up the necessary infrastructure to support your business operations, including technology systems, accounting processes, and administrative procedures.
By focusing on these areas early on - and using an AFSL for hire type service for your compliance needs - you can lay a strong foundation for your financial services business and increase your chances of success.
If you're interested in obtaining your own AFSL licence, this is the best starting point: ASIC
And speak with us here at Avenir Capital! We hold a broad-ranging (and blemish-free since it was granted in 2011) Wholesale Australian Financial Services Licence (AFSL 405469) which can be used by firms operating in the Funds Management and Asset Management industries. If you're not wanting to use our licence for the long term, ie you may be wanting to obtain your own licence down the line, that's all good... you can just access our AFSL for rent service on a short term basis. Or if you're wanting to be with us for on a longer term basis, you can tap into better rates and complimentary value-add services.
We can also assist you in obtaining your own AFSL in conjunction with our partner, Tom O'Callaghan at 360 Certainty.
Contact us today for an obligation free consult:
>> Complete our short enquiry form
OR, contact one of our team directly, Anya, on 0438 355 002 or email firstname.lastname@example.org