How secure is your data – and how secure do your investors feel?
In today’s dynamic financial landscape, protecting sensitive investor information and maintaining the integrity of your company’s cap table is paramount for any private company.
Many early-stage companies keep their shareholder registers in spreadsheets, emailed between founder and team in offline versions. This is not just laborious, it also poses significant cyber, security, and data privacy risks as well as version control and accuracy issues. Mathematical and human errors, along with the potential for reputational and compliance issues, can lurk beneath the surface.
The perils of spreadsheets
Managing cap tables via manual processes, such as Excel spreadsheets and email communications, can be riddled with vulnerabilities:
Potential for mathematical & human error: Manually updating Excel spreadsheets leaves room for errors. Data entry mistakes, formula discrepancies, and version control issues can compromise the accuracy of your cap table. These errors can have significant financial and legal consequences as well as adding admin and complexities for cap raises.
Reputational risks with investors: Errors in cap tables can undermine investor trust and damage your company’s reputation. Mistakes, even if unintentional, can raise doubts about your company’s professionalism and financial competency, potentially dissuading future investments.
Compliance risks with regulators: Mishandling investor information and cap table data can result in compliance breaches. In Australia, the Privacy Act 1988 governs the protection of shareholder data (among other regulations) including the collection, use, disclosure, and storage of personal information. It requires companies to take reasonable steps to protect personal information, including shareholder data, from misuse, interference, loss, and unauthorised access. This may involve implementing security measures to safeguard the data. It also means shareholders have the right to access and correct their personal information held by private companies. Companies should have processes in place to facilitate these requests. And it means companies are obligated to report data breaches breaching the Privacy Act or other obligations, which can lead to costly and damaging legal challenges, fines, and regulatory investigations.
A safer, cleaner system
Transitioning to FCX’s secure, encrypted, and centralised private markets platform offers a proactive solution to mitigate these risks and ensure robust data management, by:
Derisking via controlled access: FCX offers controlled access to investor information and cap table data. Access can be tailored to specific roles and permissions, reducing the risk of unauthorised access, data breaches, or information leaks. Enhanced security measures give peace of mind in the confidentiality of sensitive data.
Nominated team members (or intermediaries) can log in with set permission controls, from read-only to administrator. This shared, live register avoids issues with update lags, version control, and security risks. Not only will everyone be on the same page, but changes will update in real-time – whether documents signed, funds raised, or certificates issued.
FCX is backed by our parent company FinClear, Australia’s leading independent fintech and ‘finfrastructure’ provider, which is regulated by ASIC and the ASX. FinClear also has two Australian Financial Service Licenses and is a General Clearing Participant of ASX Clear and ASX Settlement Participant. FCX uses its established processes, technology, and expertise with an inhouse technology team dedicated to Security and Infrastructure.
Moving to a protected digital register increases security and removes risk for you and your investors, so we take it very seriously. We have more than a quarter century track record servicing Tier 1 banks. We have a best-practice, industry-aligned information and cyber security framework that focuses on people, processes and technology to reduce risk and maintain resilience, including annual external audits and peer review coding.
Derisking via single source of truth: By transitioning from manual Excel spreadsheets to a centralised, digital source of truth – up to date in real time – you eliminate version control issues and reduce the risk of errors, ensuring data accuracy.
FCX provides both companies and investors with transparent and secure access to view and manage holdings, and access important information and documents at any time. Because FCX uses distributed ledger technology, your cap table becomes immutable – no more worrying about inaccurate, damaged, or lost files stored on somebody’s hard drive. It is automatically updated with all necessary documentation, all in one place.
Future-proofing with scalability: As your company grows and your number of investors increases, managing cap tables and investor information can become more complex. FCX allows you to scale effortlessly without additional administrative overhead. The platform is designed to accommodate your evolving needs, ensuring data integrity as you expand.
Demonstrating compliance: FCX complies with rigorous data privacy and cybersecurity standards, providing peace of mind for both you and your investors. Storing sensitive data in a secure, encrypted environment reduces the likelihood of compliance breaches and gives you better visibility over any security issues than email, making compliance and reporting easier.
Compliance regarding shareholders access to their information is also easier, as investors have ongoing visibility over their securities and access to key information. This can save hours of time responding to requests for past documents, personal information changes, dates, prices, company updates, or lost share certificates.
Managing investor risk is easier with Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance checks integrated as part of our customer due diligence process. These checks give let us manage risks and security and combat financial crime. FCX uses GreenID and Refinitiv’s World Check for integrated KYC and AML compliance checks as part of our Customer Due Diligence (CDD) process; market-leading digital identity verification and screening services that are fast, accurate and ensure that details are kept secure.
Accuracy and efficiency via automation: FCX automates cap table management processes, reducing the administrative burden on your team while enhancing accuracy and removing errors and discrepancies in your cap table.
A secure and compliant future
In a world where data is a precious asset and regulatory requirements are becoming increasingly stringent, transitioning to a secure and encrypted centralised platform like FCX is not just a wise choice but a strategic imperative. By doing so, you can mitigate the risks associated with manual processes, safeguard sensitive investor information, and maintain the trust and confidence of your investors. Moreover, you’ll be future-proofing your company, ensuring its ability to scale and thrive in the ever-evolving landscape of private capital markets. Invest in security, accuracy, and efficiency today for growth without strings.
How secure is your data – and how secure do your investors feel?
In today’s dynamic financial landscape, protecting sensitive investor information and maintaining the integrity of your company’s cap table is paramount for any private company.
Many early-stage companies keep their shareholder registers in spreadsheets, emailed between founder and team in offline versions. This is not just laborious, it also poses significant cyber, security, and data privacy risks as well as version control and accuracy issues. Mathematical and human errors, along with the potential for reputational and compliance issues, can lurk beneath the surface.
The perils of spreadsheets
Managing cap tables via manual processes, such as Excel spreadsheets and email communications, can be riddled with vulnerabilities:
Potential for mathematical & human error: Manually updating Excel spreadsheets leaves room for errors. Data entry mistakes, formula discrepancies, and version control issues can compromise the accuracy of your cap table. These errors can have significant financial and legal consequences as well as adding admin and complexities for cap raises.
Reputational risks with investors: Errors in cap tables can undermine investor trust and damage your company’s reputation. Mistakes, even if unintentional, can raise doubts about your company’s professionalism and financial competency, potentially dissuading future investments.
Compliance risks with regulators: Mishandling investor information and cap table data can result in compliance breaches. In Australia, the Privacy Act 1988 governs the protection of shareholder data (among other regulations) including the collection, use, disclosure, and storage of personal information. It requires companies to take reasonable steps to protect personal information, including shareholder data, from misuse, interference, loss, and unauthorised access. This may involve implementing security measures to safeguard the data. It also means shareholders have the right to access and correct their personal information held by private companies. Companies should have processes in place to facilitate these requests. And it means companies are obligated to report data breaches breaching the Privacy Act or other obligations, which can lead to costly and damaging legal challenges, fines, and regulatory investigations.
A safer, cleaner system
Transitioning to FCX’s secure, encrypted, and centralised private markets platform offers a proactive solution to mitigate these risks and ensure robust data management, by:
Derisking via controlled access: FCX offers controlled access to investor information and cap table data. Access can be tailored to specific roles and permissions, reducing the risk of unauthorised access, data breaches, or information leaks. Enhanced security measures give peace of mind in the confidentiality of sensitive data.
Nominated team members (or intermediaries) can log in with set permission controls, from read-only to administrator. This shared, live register avoids issues with update lags, version control, and security risks. Not only will everyone be on the same page, but changes will update in real-time – whether documents signed, funds raised, or certificates issued.
FCX is backed by our parent company FinClear, Australia’s leading independent fintech and ‘finfrastructure’ provider, which is regulated by ASIC and the ASX. FinClear also has two Australian Financial Service Licenses and is a General Clearing Participant of ASX Clear and ASX Settlement Participant. FCX uses its established processes, technology, and expertise with an inhouse technology team dedicated to Security and Infrastructure.
Moving to a protected digital register increases security and removes risk for you and your investors, so we take it very seriously. We have more than a quarter century track record servicing Tier 1 banks. We have a best-practice, industry-aligned information and cyber security framework that focuses on people, processes and technology to reduce risk and maintain resilience, including annual external audits and peer review coding.
Derisking via single source of truth: By transitioning from manual Excel spreadsheets to a centralised, digital source of truth – up to date in real time – you eliminate version control issues and reduce the risk of errors, ensuring data accuracy.
FCX provides both companies and investors with transparent and secure access to view and manage holdings, and access important information and documents at any time. Because FCX uses distributed ledger technology, your cap table becomes immutable – no more worrying about inaccurate, damaged, or lost files stored on somebody’s hard drive. It is automatically updated with all necessary documentation, all in one place.
Future-proofing with scalability: As your company grows and your number of investors increases, managing cap tables and investor information can become more complex. FCX allows you to scale effortlessly without additional administrative overhead. The platform is designed to accommodate your evolving needs, ensuring data integrity as you expand.
Demonstrating compliance: FCX complies with rigorous data privacy and cybersecurity standards, providing peace of mind for both you and your investors. Storing sensitive data in a secure, encrypted environment reduces the likelihood of compliance breaches and gives you better visibility over any security issues than email, making compliance and reporting easier.
Compliance regarding shareholders access to their information is also easier, as investors have ongoing visibility over their securities and access to key information. This can save hours of time responding to requests for past documents, personal information changes, dates, prices, company updates, or lost share certificates.
Managing investor risk is easier with Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance checks integrated as part of our customer due diligence process. These checks give let us manage risks and security and combat financial crime. FCX uses GreenID and Refinitiv’s World Check for integrated KYC and AML compliance checks as part of our Customer Due Diligence (CDD) process; market-leading digital identity verification and screening services that are fast, accurate and ensure that details are kept secure.
Accuracy and efficiency via automation: FCX automates cap table management processes, reducing the administrative burden on your team while enhancing accuracy and removing errors and discrepancies in your cap table.
A secure and compliant future
In a world where data is a precious asset and regulatory requirements are becoming increasingly stringent, transitioning to a secure and encrypted centralised platform like FCX is not just a wise choice but a strategic imperative. By doing so, you can mitigate the risks associated with manual processes, safeguard sensitive investor information, and maintain the trust and confidence of your investors. Moreover, you’ll be future-proofing your company, ensuring its ability to scale and thrive in the ever-evolving landscape of private capital markets. Invest in security, accuracy, and efficiency today for growth without strings.