2. Agenda
Introduction to crowdfunding
• the three models
• the process
The crowd
What investors, lenders or donors are
looking for
Key tips for crowdfunding
Q&A
4. Statistics
Globally
2012 £1.8 billion
2013 Set for £3.5 billion
Kickstarter
£22 million pledged for UK projects in one year
£17.1m for successful projects
Crowdcube
2013 £12.2m invested - 54 businesses, 10 second round
Over 43,000 members
Raised £1.5 million for its own growth 2013
(partner Crowdfunder raised £648,890)
5. Crowdfunding models
Equity = crowd-investing
Works best for larger investment in the whole business model.
Must be able to offer share capital (also Community Shares)
Loans/debt = crowd-lending
Works best for business or enterprise that does not wish to give
away equity – but can repay a loan, with interest.
Social lending possible.
Donations or rewards = crowd-funding
Works best for a well connected enterprise/entrepreneur
with a clearly defined product and deadline.
All-or-nothing or all you raise you can keep
11. The Pebble
$10.26 million (donations)
£40,000 (donations)
Baker’s Toolkit
£175,000
Draw Like a Boss
£51,833 donations
Successful campaigns
£310,800 (equity)
Bonk of Pants
£56,865 (debt)
12. Failed projects
40-50% succeed (20% equity)
Sending dynaspheres to
Europe
World’s first Apple
Museum
Open Source Death Star
11% receive
no pledges at all
13. Why crowdfunding
It gives access to capital
But - its not just about the money
loyal customers (evangelists)
pre-sales
marketing and PR
different inputs and ideas
Incubation - proof of concept
can be easier than obtaining grants or loans
free – if it fails
And what it isn’t ….
14. Why do people donate or invest?
• Personal contact - family and friends, wider
personal/organisational networks (they like you or
believe in what you are doing)
• Closeness values, professional or geographical
(what’s in it for them)
• Support creators or causes (community of interest)
• Seek rewards (they want the product)
AND for equity and loans
A financial return on their investment
15. Incentives
Tax breaks
• Enterprise Investment scheme (EIS)
• Seed Enterprise Investment Scheme (SEIS)
Managed Funds – first is from Crowdcube
Shares – dividends or sale (direct or nominee)
Rate of return on a loan (P2P ISAs coming)
Rewards – gadget, tech or game
16. Crowdfunding – equity
Strength of the business case
Tax relief
Quality of the pitch
Experience of the team
CEO personal investment in the business
18. Crowdfunding – donations/rewards
Strength of the idea
Quality of the pitch
Credibility of the project owner
Value of the rewards
AND MOST IMPORTANT
Social capital - wide engaged social
networks
19. Near Desk
The oyster card for desks: rent office space by the
Hour at various locations around the UK
£134,500 for 7.71% equity
139 investors – investments from £10-£51,000
25% of investors had invested in crowdfunding
campaigns before
EIS eligible
20. Something Indie
Campaign on Seedrs
£20,000 raised for 10% equity
Handpicked online selection of
indie brands
67 investors
Clear concise business plan and
(understandable) business model
Well-defined target market
Track record
21. Some key tips
Communicate your business
Reasonable value for the business
Have a great idea
Have an unfair advantage
Offer incentives
Network like crazy
22. • Register for free
• Post projects
• Search for platforms or projects
• News and information
Who am I – history and why doing this (fundraiser and trainer0Run workshops and support campaigns – even to project manageGo round – name, organisation and if they have an ideaNot sit next to those they work with – at this stage
TechnicalCreativeResources- mostly time but a good video helps