Revealed: the UK's biggest crowdfunder

One company has today cemented its position as the UK's biggest crowdfunder.

by Rebecca Burn-Callander
Last Updated: 31 Oct 2017

Seedrs, which has been jostling for position against rival platform Crowdcube over the past five years, emerged the clear victor today.

Over the past three months, Seedrs claims that its completed deals – those that hit 100% of their target – totalled £29.4m. That's almost 70% higher than Crowdcube’s tally.

This compounds last year's data, which showed that Seedrs funded 134 deals during the whole of 2016, with Crowdcube behind on 124. That was Seedrs strongest ever year, with more than £85m invested; £20m more than in 2015. 

Seedrs and Crowdcube are the most active investors in the country, responsible for 86% of all crowdfunding activity. They generate almost a quarter of all UK equity investments between them, according to data company Beauhurst.

Seedrs may have proved its mettle but it may also be passively benefiting from a wider trend: British start-ups are in vogue, attracting a wave of finance. 

Beauhurst’s latest issue of The Deal, which analyses deal activity in the UK, found a record number of start-up deals in the third quarter of 2017, up 58% on the previous peak.

Deals worth more than £10m accounted for 15.26% more transactions than ever before, with eight deals above £50m during the three-month period.

Start-ups, with their exponential growth potential, are proving hot investments during the longstanding low-interest-rate environment. These high-risk investments are one of the few ways that investors can massively outperform the market.

To capitalise on the strength of its position - and tap into this trend - Seedrs is now launching a new programme to widen its appeal.

It will now actively target financial intermediaries, such as accountants, brokers and financial consultants, encouraging them to introduce their wealthy clients to early stage equity deals on Seedrs.

'Equity crowdfunding has become increasingly interesting to accountants, brokers and financial consultants,' claims Thomas Davies, chief investment officer at Seedrs. 'The Seedrs nominee structure gives advisers the peace of mind that their clients are investing on the same terms as professional VC firms, receiving full voting rights, often pre-emption rights, consent rights and tag along provisions to protect minority shareholder rights.'

Seedrs has raised a total of £10m from the crowd via its own platform to achieve it growth goals. The business is now valued at £50m.

For years, crowdfunding has attracted significant scepticism from the financial community, driven by some high-profile business failures.

But Seedrs finally won over the old guard when superstar fund manager Neil Woodford backed the business in 2015.

Tennis pro Andy Murray also added a little celebrity sparkle to the London-based company by backing several businesses on the platform.

Crowdfunding has had a major impact on the UK investment scene, especially at seed stage. Last year, a total of £3.6bn was invested into equity deals, according to Beauhurst.

Seedrs was launched by Jeff Lynn and Carlos Silva in 2012, while Crowdcube, founded by Darren Westlake and Luke Lang, went live a year earlier.

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