A quick update on SyndicateRoom, which is staging a £1.2m fundraise for itself, through itself.
The platform is offering up 14.12% of its equity, at a pre-money valuation of £7,301,471. The EIS-eligible round launched today and is already 76% subscribed, equating to just over £900k of money raised. Should this rampant pace of investment continue, the round would not run into overfunding, as it is capped at the target raise of £1.2m. Interestingly the maximum amount that any individual investor may contribute to the round is £5k. We learned from a platform representative that the round is designed to attract as many “owner advocates” as possible – thus the investment cap.
True to the model, a prominent Angel investor is leading the way. So-called “super-angel” Jonathan Milner invested £250k of his own money after negotiating the terms and valuation of the deal. Every private investor who follows on will invest on exactly the same terms as the lead Angel.
Mr. Milner offered his thoughts:
“I have been a board observer in the business for over a year. SyndicateRoom’s vision, values and team make it an incredibly exciting business and I look forward to investing alongside others in this funding round.”
“SyndicateRoom has demonstrated that when done properly, where the interests of investors are genuinely balanced with those of quality, serious businesses seeking investment, equity crowdfunding can be a huge force for good for both investors and industry. As an experienced angel investor, I know how crucial fairness and transparency are to successful investment, where both sides win, and SyndicateRoom unquestionably leads the way in this regard.”
SyndicateRoom has funded over £20m of equity transactions since launching approximately a year and a half ago. The platform has claimed a number of accolades in that time – such as fastest growing UK equity crowdfunder, the first instance of return within the UK equity crowdfunding market, and the world’s first ISA-eligible equity crowdfunding opportunity. It’s still early doors, but of the 30+ companies that have received funding through the site, none have failed thus far. Meaning the possibility of return is alive and well.
Goncalo de Vasconcelos, Founder and CEO of the platform, summarised:
“The enormous demand from our existing shareholders to invest more in SyndicateRoom is an obvious validation of our unique approach to equity crowdfunding and tells us we are very much on the right track, even if it is a very different one from the other two big players in the sector. With every investment round on SyndicateRoom being led by one or more experienced angel investors or VCs – negotiating the valuation, agreeing all the terms and investing significantly themselves, and then sharing these exact arrangements with all investors who join the round – our model offers greater fairness and transparency for investors than any other.”
“As business is going so well, we only need to raise £1.2m at this stage, but we have tried to do this in a way that will allow many new investors to join us. We know that the way we operate makes our shareholders enthusiastic advocates for SyndicateRoom, which expands our reach to the right people without having to spend a fortune on advertising.”
“Because we are not overfunding, we know that a number of people will miss out on this round, but we hope to be able to welcome them in future raises down the line.”
AltFi is returning to Amsterdam for its second annual Summit in the city. The inaugural event last year was a roaring success, with key figures from across Continental Europe's alternative finance and digital banking sectors highlighted. These included Jeroen Broekema, managing director of Funding Circle Netherlands, and Mieke van Engelen, head of innovative partnerships at ABN AMRO's standalone lending platform, New10.