Poundland founder raises double Crowdcube target for online estate agency business
EstatesDirect.com backed by almost £500k in oversubscribed pitch
An online estate agency business started by Poundland founder Steve Smith has raised almost £500,000 on equity crowdfunding platform Crowdcube in order to fund its roll-out across the UK.
Founded in 2010 and headed up by Steve Smith and DatingDirect.com founder Darren Richards, EstatesDirect.com aims to bypass the high fees charged by offline estate agents by charging a 0% rate of commission for properties listed on the site, with a fixed fee applicable regardless of size or value.
Listed on Crowdcube with an initial target of £250,000 in exchange for 5% equity, the business closed the pitch having raised almost double its target, backed by £499,250 from 195 investors.
The investment will be used to back the company in its stated aim of capitalising on the £6.7bn estate agency market in the UK by expanding the service outside London and achieving national reach for the first time.
Steve Smith is the latest high-profile entrepreneur to turn to crowdfunding as a finance method, with other entrepreneurs including Michael Roux Jr and Grand Designs’ Kevin McCloud previously listing pitches on Crowdcube.
Smith is best known as the founder of UK-wide pound store chain Poundland – starting the business in 1990, Smith sold the business for £50m in 2002.
Estatesdirect.com founder Steve Smith said in a statement: “We want to make EstatesDirect.com the UK’s largest personal estate agency network within the next few years. The estate agency market is huge, but is currently dominated by high street agents that charge exorbitant fees – our aim is to bridge the gap between online and high street and make the process easier and cheaper.
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“We decided on crowdfunding via Crowdcube because it would allow us to open it up to public investors for a small stake in the business for the first time. We clearly underestimated the interest, but delighted we doubled our original target.”
Luke Lang, co-founder of Crowdcube, added: “When the founder of Poundland, the Chairman of Gieves & Hawkes and Michel Roux Jr come to us to secure funding, you realise just how much the crowdfunding market has matured,
“It’s now a serious source of investment and we’re proud to attract such high calibre interest.”