Crowdfunding platform SyndicateRoom receives FCA approval
Hybrid investment platform becomes third site to receive direct authorisation from City watchdog
Equity-based crowdfunding platform SyndicateRoom today announced it has received direct authorisation from City watchdog the Financial Services Authority (FCA), just six months after it launched.
The site joins alternative finance providers Seedrs and Crowdcube in being one of three crowdfunding platforms to receive direct authorisation from the FCA.
Launched in 2013, SyndicateRoom is a hybrid equity crowdfunding platform in which pitches can only list on the site if they have already received backing from professional investors.
The platform says this model provides investors with an additional layer of peace of mind not present in other crowdfunding platforms, by giving them the knowledge that they are investing alongside seasoned investors who have decided their backing is worth the risk.
Successful pitches that have listed on the site include cloud-based music player Psonar, aircraft designer e-Go and ‘urinal videogame’ Captive Media.
Crowdfunding platforms are not currently required to receive direct FCA authorisation, but SyndicateRoom said the process was part of its drive to bring crowdfunding ‘into the mainstream of investing’.
The move comes after the FCA revealed its long-awaited plans to regulate the crowdfunding industry as a whole, which drew a mixed reaction from industry insiders.
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Goncalo de Vasconcelos, founder and CEO of SyndicateRoom, said: “We found the FCA to be very helpful and thorough throughout our application. SyndicateRoom took just two months to become directly authorised by the FCA, whereas for competitors it took over 12 months to become approved.
“Together with the recent announcement by the FCA on the new rules for alternative finance platforms, it shows that the FCA is taking alternative finance seriously, which is hugely welcomed.
“When crowdfunding first arrived in Britain it was seen as the exotic preserve of a committed few. Now its simplicity and transparency are attracting ever more sophisticated investors looking for attractive returns.”