The corporate watchdog has banned start-up companies from making multiple crowd-source funding offers to raise money to expand.

The Australian Securities and Investments Commission (ASIC) on Thursday released its draft regulatory guide on crowd-source funding (CSF), which allows start-ups to raise money by issuing shares to investors.

Eligible unlisted public companies with less than $25 million in consolidated assets and annual revenue will be able to raise up to $5 million a year under the new CSF regime, which will be implemented in late September.

But ASIC says there are a number of rules that companies, and other people involved, must comply with, including a prohibition on multiple CSF offers and restrictions on how a company advertises its CSF offers.

"Many companies using the CSF regime will likely be start-ups or early-stage companies that will not have experience in raising funds from the public," ASIC said in the report.

"There are consequences for a company it if does not comply with these rules, which may include the company committing an offence."

Start-ups wanting to raise money through equity crowdfunding will also be forced to register as public companies with ASIC.

Current rules state that start-ups raising money through crowdfunding can issue shares only to wealthy investors, with assets of at least $2.5 million.

The new CSF regime, which passed through parliament in March, means anyone will be able to invest and receive shares in a company.

There will be a cap for investors of $10,000 per company each year, and a five-day cooling off period.

Unlike public companies listed on the stock market, start-ups that go public won't have to host annual shareholder meetings or provide audited financial statements for crowdfunded capital raisings.

They also won't be subject to the same public disclosure obligations as listed companies.

Many companies using the CSF regime will likely be start-ups or early-stage companies that will not have experience in raising funds from the public.

The new laws will be implemented on September 29, following the release of the final regulatory guide.

AAP