Do you need an AFS licence to help a company raise money?

Section 911A(1) of the Corporations Act says a person who carries on a financial services business in Australia must hold an AFS licence covering the services they provide. Breaking it is a criminal offence and a civil penalty provision, and a client who signed an agreement with an unlicensed person can tear it up (s925A). ASIC still brings these cases: in December 2025 it took an Adelaide firm to court for raising money from investors without a licence.

Shares are financial products, so the question is always whether what you are doing with them is a financial service. Two kinds matter here. Financial product advice is a recommendation or opinion meant to influence someone's decision about a financial product (s766B). Dealing is issuing, buying, selling or applying for one (s766C(1)), and arranging for someone else to do any of those is dealing too (s766C(2)).

A company that issues its own shares is not dealing (s766C(4)). The exemption covers the company acting through its directors and employees. It does not cover a company whose business is investing other people's money in securities or land (s766C(5)), and it does not stretch to an outside agent: someone who deals as the company's agent is not dealing on their own behalf and gets no self-dealing exemption of their own (s766C(3A)).

So a founder who pitches their own company, sends the terms to investors, and takes their money for shares is doing none of the things that need a licence. Sending factual information about the company is not advice either. ASIC's guide says factual information is objectively ascertainable information whose truth cannot reasonably be questioned, and you do not need a licence to give it (RG 244.24 to 244.25). Telling an investor the company's revenue is factual. Telling them the shares are a good buy at that price is advice.

The moment someone other than the company brings investors to the deal as a business, they are almost always arranging. ASIC's guide (RG 36.43) gives three signs: your involvement is important enough that the deal probably would not happen without you, for instance because you are the person the investors actually deal with; your involvement significantly adds value for the person you are acting for; and you receive benefits that depend on the decisions the investors make. A success fee is the clearest example of the third. None of the three is decisive on its own, but a corporate adviser running a raise for a fee normally has all of them.

Whether the investors are wholesale makes no difference to the licence. ASIC's guide says plainly that without an exemption you need an AFS licence whether you provide financial services to retail or wholesale clients (RG 36.58). This is the point that catches people who know s708 well: the s708 exemptions remove the need for a disclosure document, and nothing in them touches licensing. The tax law even describes s708 in those words.

What wholesale status does change is the paperwork and the fees. Advice to wholesale clients skips the retail disclosure regime, and the ban on conflicted remuneration is defined by reference to advice given to retail clients (s963A), so a placement fee paid by a company for a wholesale raise is not caught by it.

Most small advisory firms do not hold their own licence. They become an authorised representative of a licensee (s916A), often called a CAR when the representative is a company, and the licensee's authorisation has to cover what they actually do: for a wholesale capital raise, dealing by arranging for wholesale clients. A firm working under another firm's mandate needs its own authority; there is no informal sheltering under someone else's licence.

A company engaging an adviser can check. ASIC's registers of licensees and authorised representatives are public, and the questions to ask are the licence or representative number, the licensee behind a CAR, whether the authorisation covers arranging for wholesale clients, and whether it is current.

There is an exemption for a pure referral (reg 7.6.01(1)(e)). It covers a service that consists only of telling someone that a licensee can provide a particular service and how to contact them, where you are not the licensee's representative and you disclose, in the same form, any benefit you or an associate may receive. Introducing an investor to a company, or a company to an investor, is not that. The exemption points people at a licensee; it does not let you do the licensee's job.

There used to be class relief for business introduction and matching services. The version covering company securities lapsed some years ago, and the last instrument (2022/805, covering managed investment schemes) was allowed to expire on 1 April 2025 with no replacement. ASIC withdrew its guide on the topic at the same time. Anyone still relying on business introduction relief for a share raise is relying on nothing.

Struck is software. It hosts the company's own offer, with the company's own documents, to investors the company or its adviser invites. It does not introduce investors, give advice, or hold money; payments go straight from the investor to the company's account. An advisory firm records its AFSL or CAR authorisation once on its Licensing screen, and every raise it advises shows that record on the raise's compliance page, as attribution and never as endorsement. Founders raising for their own company have nothing to record, because they need no licence.