Crowdfunding platforms: An A-Z directory

With crowdfunding becoming an increasingly popular source of alternative finance for start-ups, new platforms are emerging almost daily.

Probably the biggest decision for most start-ups is deciding between reward and equity-based platforms, but there are a number of other options to consider, including what type of platform is best suited to your business and how much the commission fees are.

To help you sift through the essential information you need to know about each platform, we’ve created a comprehensive A-Z directory of what services are available right now, including a succinct description and key statistics for each option.

Crowdfunding platforms in the UK:

BankToTheFuture.com

Model: Reward and equity-based

Website: https://banktothefuture.com/

Good for: Any business or entrepreneur bringing new products to market

Suitable for investments: Of any amount (no minimum or maximum required)

Commission: 5% of money raised (reward or equity) and 1750 legal fees (equity only) if successful.

Maximum investment period: 180 days

Formed in 2012 BankToTheFuture have already gained recognition from the UK’s leading business leaders including Richard Branson and won the British Innovation of the Year award 2012. The company has put three forms of crowdfunding into one to enable you to have more choice; crowdlending, crowdfunding and crowdinvesting. The company is the only site which enables you to see exactly who has viewed your pitch.

If you don’t hit your funding goal the company provides a flexible funding offer to make the most out of the money you raised.

Bloom VC

Model: Reward-based

Website: http://bloomvc.com/

Good for: Arts and creative projects, businesses and start-ups and those creating a prototype

Suitable for investments: Around £10,000 or more

Commission: 5% fee from project funding total

Maximum investment period: 60 days.

Formed in 2012 the company aims to ‘buck the trend of twenty-somethings at the heart of the revolution’ and give you 100% ownership of your project.

Projects in the arts and creative industry do particularly well as do smaller projects.

Buzzbnk

Model: Reward-based

Website: www.buzzbnk.org

Good for: Social enterprises and other ventures pursuing social change

Suitable for investments: Of between £5,000 and £30,000

Commission: £25 registration fee, plus 5% of successful investments

Maximum investment period: Unlimited, but 90-180 days advised

Unlike other crowdfunding platforms, Buzzbnk allows backers to pledge their time and support, as well as their money – such as by pledging to write a blog, share your campaign via their social networks, or run a banner on their website. In fact, Buzzbnk straddles the gap between equity and reward-based platforms, as you have the option to offer interest payments, as well as non-monetary rewards, depending on the size of the pledge. Buzzbnk campaigns are commonly funded by a large number of small (£10-£20) pledges, but each campaign can be split into achievable milestones. For example, if £5,000 would allow you to lease a space, that could be your first milestone. When you hit this, the money will be released and you can reset the timeframe with another milestone – for example, £3,000 to buy the stock for that space. Buzzbnk donates more than 73% of its profits to charity.

CrowdBnk

Model: Reward and equity

Website: www.CrowdBnk.com

Good for: Pre-revenue and early-stage UK start-ups

Suitable for investments: From £10 (no maximum)

Commission: 5% of money raised + 3% processing fee + 1% legal fee (capped at £10,000)

Maximum investment period: 90 days

The only crowdfunding platform granted permission from the Financial Conduct Authority (FCA) to offer direct equity investments to all types of investor, CrowdBnk says it provides the best environment for business ideas to get off the ground. Calling itself “adventure capital”, the site operates both a reward and equity model and offers those that list as an equity project extra support to form a PLC once the funding target has been met.

As well as facilitating funding, CrowdBnk also provides businesses registered on the site with help to formulate business plans and templates for legal contracts.

Operating on an all-or-nothing basis, the platform runs identity checks on both potential investors and businesses looking to raise investment and has measures in place to combat money laundering.

Crowdcube

Model: Equity-based

Website: www.crowdcube.com/partner/startups

Good for: Raising large investments and building a community with a vested interest in your business’ success Suitable for investments: Of £5,000 or more

Commission: £250 listing fee + 5% of successful investments and £1750 legal fees if successful

Maximum investment period: 90 days (60 days if you use Crowdcube directly)

The world’s first equity-based crowdfunding platform – and the first to host a £1m investment through crowdfunding – Crowdcube provides the structure of traditional angel investment, but with the power of the crowd from which to seek it. Investments start from just £10, empowering ordinary people to invest, and helping start-up and growing businesses meet their targets through power in numbers. Ideal if you need to raise large sums of finance, investors receive greater equity stakes in your business the more they invest. For example, if you offer 10% of your business for a £100,000 investment, someone investing £10,000 will receive 1% equity. You can also offer prospective backers exclusive rewards, including tax relief, as an added incentive to invest.

The first Financial Conduct Authority (FCA) regulated crowdfunding platform to enable investors to become direct shareholders in UK companies, Crowdcube provides investors with access to advice from independent experts from the Financial Ombudsman Service (FOS). Investors can also benefit from the option of claiming compensation through the Financial Services Compensation Scheme (FSCS).

Startups has partnered with Crowdcube to allow entrepreneurs access to a large community of start-up support, from Startups.co.uk’s audience of more than 300,000 unique visitors a month.

Crowdfunder

Model: Reward-based

Website: www.crowdfunder.co.uk

Good for: Creative, ingenious or humorous ideas and start-ups that are a bit of a ‘wildcard’

Suitable for investments: Of £100 or more

Commission: 5% of successful investments

Maximum investment period: 60 days

The sister site to Crowdcube, Crowdfunder uses the same structure as its equity-based relation but is tailored to entrepreneurs looking for backers rather than investors. Without the need for businesses to deliver financial returns, Crowdfunder is focused on being a creative forum for dynamic, original and meaningful projects. The targets of pitches successfully funded through the platform since June 2011 have averaged £1,500 (but rising) and businesses pitching the kind of products people want to own, or games they want to download, have enjoyed particular success. The platform is also well-suited to start-ups with an unconventional, tongue-in-cheek or innovative but untested idea.

CrowdMission

Model: Equity-based

Website:  www.crowdmission.com

Good for: Social impact businesses looking to raise over £10,000

Suitable for investments: From £10

Commission:  No listing fee, 5% success fee and legal fees of £1,750 + VAT

Maximum investment period: 90 days

Founded in 2013 by Karen Darby, serial entrepreneur and founder of energy tariff comparison SimplySwitch, CrowdMission claims to be unique amongst equity crowdfunding platforms by requiring that every business listed on its site must have a social mission at its core.

Start-ups looking to pitch need to provide an obvious benefit to society, health or the environment, which must go above-and-beyond the common social benefits of running a business, such as job creation or stimulating the local economy.

Seeking to support the “next generation of social entrepreneurs”, the platform is particularly keen to work with green energy businesses and bioscience companies.

Crowdrooster

Model: Reward-based

Website: www.crowdrooster.com

Good for: Product and design-driven businesses looking to take their ideas to market

Suitable for investments: Of any amount, no maximum or minimum

Commission: 7% + VAT

Maximum investment period: Yet to be confirmed

Crowdrooster is a product-led crowdfunding platform with an “e-commerce twist”. Open to businesses from across the world, you can raise finance through the site by allowing the ‘crowd’ to pre-purchase your products at a competitive price. Once the funding target has been reached, these products then have to be manufactured and distributed to each of the investors.

The “crowdcommerce” site works on an all-or-nothing basis and businesses looking to use the platform will be vetted for their feasibility internally and via online payment service MangoPay and will have to demonstrate a clear business plan.

Crowd for Angels

Model: Debt and equity-based

Website: https://crowdforangels.com/

Good for: Seed-stage companies through to listed

Commission: 5% fee on successful equity pitches + £1,750 legal fees. Debt commission can be found here.

Maximum investment period: 90 days for equity

A “first” for the crowdfunding industry, Crowd for Angels provides funding for businesses at seed stage through to listed which it says offers benefits to both investors and companies looking to raise investment.

Established in May 2014, the platform gives investors access to firms that would usually be reserved for institutional clients, and also offers up to 50% tax relief on investments made through the Seed Enterprise Investment Scheme (SEIS) and the Enterprise Investment Scheme (EIS).

In July 2014, the site expanded its offering to include convertible loan notes for listed businesses; another “first” for crowdfunding.

Funding Tree

Model: Equity and debt-based

Website: https://www.fundingtree.co.uk/

Good for: Seed-stage businesses through to established

Suitable for investments: £50-£1m

Commission: NA

Maximum investment period: NA

Launched in August 2014, Funding Tree is a UK equity and debt crowdfunding platform which aims to support small and medium-sized businesses through “every stage of their life cycle”; from seed capital to Series A and B rounds.

The FCA-regulated platform enables individual investors to back businesses across Europe and specifies that all crowdfunding campaigns listed on its platform must achieve 90% of their funding target in order to proceed.

The site also enables entrepreneurs to run both joint equity and debt pitches; a move which it claims enables the development of “long-term relationships with companies” as opposed to just facilitating one-off transactions.

Hubbub

Model: Reward-based

Website: https://hubbub.net

Good for: Entrepreneurial students or projects for social good

Suitable for investments: Of any amount

Commission: None

Maximum investment period:  3 Months

The company actively supports the education sector and projects that are creative or for social good. The project must have a clear goal and the amount of funding you require has to be fully evidenced and reasoned.

Hubbub also build universities their own branded crowdfunding platforms, such as https://yustart.hubbub.net/ for the University of York.

Indiegogo

Model: Reward-based

Website: www.indiegogo.com

Good for: Product-based businesses with a bit of a gimmick factor and start-ups with a story  

Suitable for investments: Of any amount (no maximum limit)

Commission: 4% of successful investments or 9% of flexible funding campaigns

Maximum investment period: 60 days for fixed funding and 120 days for flexible funding campaigns

Indiegogo somewhat bucks the trend of crowdfunding. For, as well as offering the all-or nothing (‘fixed funding’) model, the US-based business also allows you to host a flexible funding campaign, through which you keep all funds raised even if you don’t hit your target. This may suit if you can make progress with even a small amount of funding. However, it should be approached with caution, for if you raise too small an amount of money to deliver on your pitch, your backers aren’t going to be happy. Projects on Indiegogo range from fundraising for cancer treatment to community projects, but the most successful start-up campaigns are those with a mass-appeal product, such as a ‘salt gun’ to kill flies and a multi-functional iPhone case.

As well as these platforms, there is Funding Circle – which provides swift access to low-cost loans from investors – and you can also find business backers through the UK Angel Investment Network.

Kickstarter

Model: Reward-based

Website: www.kickstarter.com

Good for: Creative projects with a clear ambition (such as to get a product to market)

Suitable for investments: Of any amount (no minimum or maximum limit)

Commission: 5% of successful investments

Maximum investment period: 60 days

Recently launched in the UK, Kickstarter has already become revered in the States. Its biggest success stories include the Pebble “smartphone watch”, which raised more than $10m (£6.4m) of a $10,000 (£6,247) goal, and the Double Fine Adventure game, which raised nearly 10 times its $400,000 (£250,000) goal. Well-suited to product-based businesses, the platform favours projects relating to art, design, fashion, film, food, games, music, photography, theatre and technology, rather than those with a social cause. Unlike some of the equity-based platforms, Kickstarter requires projects to have a clear goal, such as to make a book or produce a product, rather than simply requiring funding to start up.

kriticalmass

Model: Donation and reward-based

Website: https://kriticalmass.com/

Good for: Social impact businesses or charity projects that “power good”

Suitable for investments: Of any amount

Commission: 5% fee on successfully completed projects. For not-for-profit projects you will not need to reach your goal to receive the amount raised but will be charged 5%.

Maximum investment period: Undisclosed

Launched in March 2014, kriticalmass is setting out to create a new form of crowdfunding. Dubbed as ‘Crowd+’, it gives backers the chance to offer their skills, time or business network, alongside, or instead of, finance, to help a campaign succeed.

The new platform is targeted at positive impact projects and charities who are looking to secure funding, as well as support from volunteers and corporate sponsorship. Operating an ‘all-or-nothing’ business model, organisations and brands are able to champion a project by offering their products or services to give entrepreneurs pitching on the site the opportunity to “make an idea into a reality”.

Once the round has closed,‘project creators’ then offer rewards for different types of support which can be anything from a branded t-shirt in exchange for a £20 contribution, a movie credit for expert legal advice, or dinner with a supermodel spokesperson in return for £10,000 sponsorship.

Leading technology investor Tom Teichman, early investor in Moshi Monsters, lastminute.com and notonthehighstreet.com, has already backed the platform with other entrepreneurs showing interest.

Seedrs

Model: Equity-based

Website: www.seedrs.com

Good for: Welcomes all ambitious seed, growth-focused early-stage and later-stage businesses.

Suitable for investments: Investments of up to €5m

Commission: 6% of the first £150,000, 4% of the next £350,000 and 2% of everything over £500,000

Maximum investment period: 60 days

An online platform for investing in the equity of start-ups and other growth companies, Seedrs allows all types of investors to invest as little or as much as they like (from £10) in businesses. Over £160m has been invested on the platform, with over 400 deals funded since the site’s launch in 2012.

Under FCA regulation, Seedrs is authorised to act as a nominee and sole shareholder, managing the investment made by crowdfunders and distributing profits to them, with a 7.5% carry fee from any future profits the investor makes from their investment. All investments made through Seedrs offer voting shares and use professional-grade subscription agreements. This ensures investors get the same level of protections that larger angel investors and venture capitalists enjoy.

The company headquarters is in London, with offices in Lisbon, Amsterdam, Berlin and New York. Backed by high-profile fund manager Neil Woodford, Lord Rothschild’s Augmentum Capital and Faber Ventures, the platform is open to entrepreneurs and investors in 68 countries and will be launching in the United States to US-accredited investors in 2017.

SeedUps

Model: Equity-based

Website: www.seedups.com

Good for: Tech start-ups with no previous experience of raising investment, and sourcing high net worth investors

Suitable for investments: Of under £500,000

Commission: 2% of successful investments (+ another 2% taken from investors)

Maximum investment period: 180 days

Where crowdsourcing meets crowdfunding, SeedUps is suited to tech entrepreneurs who are uncertain of a suitable valuation for their start-up. Each pitch owner must first introduce their business and outline their finance target, then await feedback from sector-relevant members of the crowd. Investors’ bids are used to create a valuation for the business, with only the best bids presented to the entrepreneur. SeedUps only allows sophisticated investors and high net-worth individuals in the US, UK and Ireland to invest through the site, meaning entrepreneurs who have never raised investment before could benefit from investors’ insights and experience. The pitch owner can then use this feedback to tweak their offering before going live with their crowdfunding page.

ShareIn

Model: Equity-based

Website:  www.sharein.com

Good for: Technology and health start-ups looking to raise anything between £40,000 and £1m

Suitable for investments: Of £10 or more

Commission: Five different pricing options ranging from £200 listing fee with 5% success fee to £1,000 listing fee and 1% success fee. £1750 + VAT for legal fees.

Maximum investment period: 60 days

Launched officially in February 2014, ShareIn is the newest equity crowdfunding platform to join the market and ‘sets itself apart’ from competitor sites by focusing exclusively on British tech and health start-ups.

Targeted at UK businesses that look to change the economic landscape through innovation, engineering and science, it is as much concerned with protecting companies looking to raise funding as it is investors by operating a “best-of-breed share structure”.

This structure, claimed to be unlike any other equity platform, means that every share brought in a pitch carries voting, drag along and tag along rights in order to facilitate “professional and fair” legal arrangements between the crowd investor and the investee company.

Start-ups looking to pitch on the site also have to justify their valuation to potential investors by providing data on money spent to date and estimated future costs.

In addition, the platform also provides investors with a secondary market for their shares via a bulletin board to enable investors to sell their shares.

SpaceHive

Model: Reward-based

Website: http://spacehive.com/

Good for: Social projects that help local communities and public areas

Suitable for investments: Of any amount

Commission: 5% fee if successful

Maximum investment period: 1 Year

Spacehive’s crowdfunding model focuses on giving something back to the community. If you have a business idea which can benefit local areas such as a new theatre, stadium etc. then this site enable you access to and funding from likeminded people who want to develop and support their community.

Sponsume

Model: Reward-based

Website: www.sponsume.com

Good for: Fun, artistic ideas and start-ups requiring funding for a specific project

Suitable for investments: More than £200

Commission: 4% of successful investments, 9% of unsuccessful investments but you get to keep all funding.

Maximum investment period: 90 days

Well suited to fun, radical and social start-ups, Sponsume has a large artistic community ready to back one-of-a-kind ideas. With pitch targets averaging between £5,000 and £7,000, this platform is especially useful for funding one-off creative projects, such as producing a short film, festival or exhibition. Ideas relating to the arts, start-ups in the music or film industry ,and projects with a political, charitable or community element may be particularly well-received; as may entrepreneurs seeking funding to launch an innovative new product.

Squareknot

Model: Equity, reward and loan-based

Website: https://www.squareknot.co.uk/

Good for: Start-ups looking for both equity and loan funding

Suitable for investments: £100 up to £10,000

Commission: £500 listing fee and equity 5% of total funding raised. For loans repaid within one year; 2% of total raised, repaid within three years; 3% of total raised and within five years; 4% of total raised. (For loans there is a 1% additional charge for businesses less than two years old)

Maximum investment period: Three months

Said to be the “first” crowdfunding platform to offer equity and loan funding on the same platform, Scotland-based Squareknot are looking to disrupt the market with their mixed-funding investment option.

Claiming its offering allows for pitches to attract all types of investors – “those who prefer investing in shares as well those who would rather lend money and get a fixed rate of return”- the site also facilitates reward-based projects, enabling businesses to offer products or goods in return for investment.

For its loan-based funding operation, investee companies have to state their target interest rate and a business plan which shows cash flow projections, detailing the likelihood of being able to make interest and loan repayments to investors within the agreed timescales. Investors will then analyse the level of risk involved and offer an interest rate to match this perceived risk.

Unbound

Model: Reward-based

Website: www.unbound.co.uk

Good for: Authors and publishers looking for financial backing

Suitable for investments: Of any amount

Commission: 50% royalty on all profits

Maximum investment period:  Not disclosed

London-based niche crowdfunding platform Unbound allows readers to pledge financial backing to authors in return for “books and goodies”. Once the funding target has been reached, the books are then written and distributed.

The platform recently announced that it has extended its offering to publishers so now publishing houses and independent publishers are able to host their own ‘channel’ on the site and offer their own projects for funding.

With the tagline that it “puts books in your hands”, the alternative publishing house claims authors receive more favourable terms than if they used traditional publishing houses where they receive 50% royalty on all profits compared to the industry standard of 5 to 10%.

Volpit

Model: Equity-based

Website: https://www.volpit.com/

Good for: Early-stage start-ups

Commission: £250 listing fee + 6% (+VAT) on successful pitches. No legal fees.

Maximum investment period: Not disclosed

Launched in June 2014, Volpit is designed to “bring interested investors and unique businesses together” and says it is the “youngest-owned” equity site to gain full authorisation from the Financial Conduct Authority (FCA).

Open to businesses across the UK, the platform seeks to differentiate from competitors by offering a ‘Pitch Builder’ service. This service allows early-stage entrepreneurs to build pitch simply by answering a series of questions; the finalised pitch will then be generated and presented in a standardised and interactive format.

The crowdfunding site bringing a “fresh approach to the marketplace” is looking to facilitate £4.5m funding for small and medium-sized businesses over the next year.

WeFund

Model: Reward-based

Website: http://wefund.com/

Good for: Creative entrepreneurs and small arts related business ideas and projects

Suitable for investments: Of £100 to £1000

Commission: 5% fee on successful projects

Maximum investment period: There isn’t a limit; you create your own ‘timeframe’

WeFund aims to transform the arts sector and its business model requires you to provide a short video explaining your idea on the site.

Good for small projects that are looking to get off the ground.

Zequs

Model: Reward-based

Website: www.zequs.com

Good for: Small-scale, extraordinary and creative projects

Suitable for investments: Of any amount (no minimum or maximum limit)

Commission: 5% of successful investments

Maximum investment period: 55 days

Very much the people’s platform, Pleasefund.us attracts a large variety of project-based pitches, from philanthropic filmmakers to creative innovators. Particularly suited to entrepreneurs with an ethical objective, the platform may also suit start-ups seeking finance for a particular project, such as to pay for presence at an international event. Although there is no ceiling for investments on this platform, the average successfully-met target is between £3,000 and £4,000. Pleasefund.us plans to introduce the option to release equity soon.

If you have had a successful experience on another UK crowdfunding platform, get in touch and share your recommendations.