Crowdcube secures £300K investment from 162 investors
UK start-up raised finance through own crowdfunding platform in 10 days
Less than two weeks after Growing Business revealed that Crowdcube was seeking growth capital through its own website, the founders have secured a £300,000 investment.
Darren Westlake and Luke Lang, who went live with their investment pitch at 2.30pm on 6 December, raised the finance in just 10 days from 162 “armchair dragons” – having generated £25,000 in the first two hours.
The co-founders charmed investors with a detailed pitch, including a video interview, and a breakdown of their financial forecasts. They then answered questions on the website’s forum.
Crowdcube, which released 9% equity to its investors, is the first crowdfunding website in the world to offer members of the public shares in the start-up or growing businesses they invest in.
Speaking exclusively to Growing Business, Lang said: “We were always very confident that we were going to do it but to do it two weeks before Christmas – if you’re going to do any fundraising, those would be the worst two weeks – we’re very pleased.
“It sets us up really nicely for the New Year and we can come in in January and hit the ground running.
“We really welcome our new, fantastic 162 investors and we look forward to getting them involved in the business.”
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The start-up, which launched in February, reached its investment target on Friday afternoon; shortly after Vince Cable unveiled a new taskforce to boost the future of small business finance, stressing the importance of peer-to-peer lending such as crowdfunding.
Westlake said of the announcement: “Business finance is at a critical turning point, as last week’s announcement by Vince Cable highlights.
“The future success of Britain’s economy is dependent on empowering small business Britain to succeed and grow but access to traditional methods of funding are often a barrier.
“The emergence of alternative sources of business finance, like crowdfunding, is already proving to be a very effective and popular solution for both entrepreneurs and investors.”