Basic Introduction

Crowdcube was founded by Darren Westlake and Luke Lang at the Exeter University Innovation Centre. The platform is an equity-based fundraising platform that allows unlisted UK-registered companies to meet the needs of the public for investment.

Platform Overview

Crowdcube is the first equity crowdfunding platform in the UK. Although it was founded in 2010, it was not recognized by the UK Financial Conduct Authority until 2013. Currently, Crowdcube provides two forms of crowdfunding services: equity crowdfunding + bond crowdfunding. Compared with other platforms, Crowdcube has a very low investment threshold, with a minimum investment limit of 10 pounds.

Operational Process

Step 1: Project Application

After the project party applies for Crowdcube equity, determines the company value and target financing amount, and provides project description, exit strategy, business plan, and financial forecast for the next three years. In this process, professionalism is the main focus. Based on historical data and past experience, Crowdcube will review the suitability of the project within 72 hours and provide detailed modification suggestions so that the company can apply again.

Step 2: Tender Preparation

After passing the review, the financier can set the financing amount and provide a certain amount of equity according to their financing needs, and publish their financing plan on Crowdcube , requiring the language to be concise and professional. During this process, Crowdcube provides a series of suggestions.

After the bid is created, Crowdcube will review it again, delete inappropriate and fancy language, verify the source of every data, and ensure the authenticity of every sentence in the project. After review and confirmation, the project can finally go online !

Crowdcube requires investors to provide the following information

1. Equity Ratio

Crowdcube has no restrictions on equity ratios, and companies generally sell 10% to 20% of their equity .

2. Target Fund Raising

Crowdcube stipulates that the minimum financing amount is 10,000 pounds, and there is no maximum limit. The best financing amount is 100,000 to 150,000 pounds . If it exceeds 150,000 pounds, the project itself must be extremely attractive and persuasive. As of December 17 , 2013 , the maximum financing amount in successful cases was 1.9 million pounds, and the minimum amount was 12,000 pounds.

3. Tax exemption policy

EIS (The Enterprise Investment Scheme) is a project launched by the British government in 1993 to help small and high-risk companies raise funds. Enterprises that meet the requirements of the project can reduce 30% of taxes when raising equity. All projects on Crowdcube meet the requirements of EIS and enjoy tax exemption policies. In addition, some companies can enjoy SEIS tax exemption policies. SEIS (Seed Enterprise Investment Scheme) is a continuation of EIS . It was launched in 2012 to help companies in their early stages of establishment to raise funds and reduce 50% of taxes.

4. Equity Type

There are Type A and Type B shares, the only difference being that Type A shares have voting rights. Financiers can offer just one type of share or both. Most companies offer Type B shares.

5. Rewards

Since it may take some time for SMEs to realize equity returns, in order to attract investors, Crowdcube recommends that financiers provide certain material rewards, such as a T -shirt with the company logo , a restaurant membership card, etc.

6. Financing period

The financier determines the deadline by himself, which usually does not exceed 60 days. If the financier needs to extend the deadline, Crowdcube will need special review.

Platform Fees

No membership fees, no project display fees, no financing process fees ! No fees charged to investors !

Only if the project is successfully financed, a handling fee of £500 plus 5% of the total financing amount will be charged to the financier .

Development History

In February 2013 , Crowdcube was deemed legal by the UK Financial Conduct Authority (FCA) .

In 2013 , it was named the hottest FinTech company in Europe .

As of July 2014 , Crowdcube has helped over 130 companies raise £ 30 million.

In July 2016 , Crowdcube Spain was approved by the Spanish National Securities Market Commission ( Comision Nacional del Mercado de Valores , CNMV ).

As of July 2016 , Crowdcube had 290,000 registered users and helped more than 400 startups raise a total of £ 170 million in financing.

In August 2016 , Crowdcube successfully raised £ 8 million through its own platform , with funding coming from venture capital and thanks to the active participation of more than 3,700 investors.

In June 2017 , Crowdcube announced that it would establish a partnership with Level39 , Europe's largest fintech incubation platform .

In November 2018 , it received a strategic investment of 8.5 million from investors including Draper Esprit and Balderton Capital .

References

• 1. Crowdcube and Level39 jointly established a financial technology startup guidance platform: Sohu [cited date 2017-06-26T16:00:00.000Z]
• 2. The development model of foreign crowdfunding platforms from Crowdcube: Sohu [cited on 2016-05-24T16:00:00.000Z]
• 3. What kind of “crowdfunding magic cube” is Crowdcube? : Hexun [cited on 2016-09-05T16:00:00.000Z]