Crowdcube Limited raises £1.5 million investment
Crowdcube has used its own platform to raise £1.5 million in just three days from 259 investors. Existing investors met the initial funding target of £250,000 within the first five hours of the pitch going live, making it the fastest equity funding on a crowdfunding website anywhere in the world. The pitch was then opened up for others to invest with one million pounds being invested in the last 24 hours. The investment, which sets a new world record for funds raised via an equity crowdfunding platform, will be used to fuel Crowdcube’s next phase of growth.
Darren Westlake, CEO and co-founder of Crowdcube, commented:
“The response from our members was truly overwhelming and really demonstrates the power of equity crowdfunding to provide platforms for people to support businesses they think are worthy of investment. To raise £1.5 million in only three days is an astonishing achievement and it puts us in a strong position to realise our growth ambitions on behalf of our new investors.”
Crowdcube will use its investment to employ more team members to support its rapid growth; to execute its marketing strategy focused on raising awareness of Crowdcube amongst entrepreneurs and investors; and to expand its equity crowdfunding platform internationally – in Sweden, Brazil and the USA initially.
“We have spoken to a number of venture capital firms over the past six months and although we agreed terms with one US-based institutional investor, the appeal of crowdfunding ourselves again was too great. It’s such a rewarding experience to know that so many people believe in what we’re doing. Our investors are a ready-made community of advocates.”
Crowdcube, which is eligible for EIS tax relief, is the world’s leading equity crowdfunding platform and has grown rapidly since its launch in 2011. The award-winning website, which is authorised and regulated by the Financial Conduct Authority (FCA), has now raised over £8.2 million for British businesses and has over 34,000 registered investors. Crowdcube becomes the 47th business to meet its funding target using the site.
This round of investment follows initial seed funding from friends and family and a first crowdfunding round in December 2011 when 162 people invested £320,000 in the company. £1.5 million was offered in exchange for 21 per cent equity in Crowdcube, which values the company at £7,142,857 million. The largest single investment in the round was £250,000, which also sets a new record for an investment or pledge via a crowdfunding platform. The average amount invested by a single investor was £5,792.
Top three funded pitches:
1. Crowdcube, the equity crowdfunding website raised £1.5 million in just three days from its members via the Crowdcube website.
2. The Rushmore Group, owner of three members’ clubs in London, secured £1 million investment from 143 investors in November 2011 to fund the development of an exciting new venue in the heart of London, early next year.
3. Escape the City, the global community for people who want to ‘do something different’ with their careers turned down two offers from well-known global Venture Capital firms and raised £600,000 on Crowdcube in just two weeks.