SyndicateRoom has introduced a new term into the crowdfunding lexicon.
The platform has just closed a “Lift Round” – which essentially means a fundraising campaign that has already reached its minimum target prior to having been listed on the site. More specifically, a Lift Round involves a fundraise that has hit its funding target thanks to significant demand from an angel syndicate, or from other professional investors. Given SyndicateRoom’s “Angel-led” investment model, such campaigns may still be listed on the platform – giving retail investors the chance to pile in on a round that is guaranteed to close, and that has the backing of a number of professional investors. Those retail investors that do choose to participate in Lift Rounds on the SyndicateRoom platform will invest on the same terms as all existing Angel investors.
MCADO, better known as the disruptive home improvement brand “Opun”, was one of the first companies to launch a Lift Round. The campaign recently raised a sizeable £982,997 through the SyndicateRoom platform, in exchange for 8.53% of the company. MCADO’s original target raise was £749,992, with the remaining money coming from retail investors. Angel investors Will Chawner and David Turnbull participated in the round.
The equity offered up by MCADO climbed in keeping with the amount of money raised by the company. The round carried a ceiling of £1.2m, which would have been equivalent to the value of the maximum amount of available equity. For MCADO, the extra funding opens the door to more rapid growth. And the company’s Angel investors will likely consider their investments marginally de-risked, given the added capital at MCADO’s disposal.
This is not the first time that SyndicateRoom has hosted a Lift Round. The platform helped Bactest to raise £301,760 in November, in what was then referred to as an “overfunded” raise. But in reality, the Bactest round was a carbon copy of the recent MCADO Lift Round.
Gonçalo de Vasconcelos, CEO of SyndicateRoom, explained:
“Lift Rounds have been an emerging trend during 2015, as equity crowdfunding comes of age. We at SyndicateRoom have always had a distinct vision: We’re democratising investment in growth businesses and crucially we’re giving our members access to a more sophisticated set of investment opportunities, enabling them to invest with the angels. We look forward to many more Lift Rounds, as SyndicateRoom enables the early-stage investment community to work in ever-closer partnership with the crowd”.