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Neil Woodford ups stake in crowdfunding platform Seedrs




By Daniel Lanyon on 5th September 2017

https://goo.gl/FM49t3

The fund manager has made a follow on investment to fund a push by Seedrs into AI and machine learning.

 

 

Seedrs has seen its value increase to £40m following on from a new funding round led by star fund manager Neil Woodford.

 

This takes the fund manager’s stake in the crowdfunding platform to £10m, after putting in a £4m investment and a £6m investment back in 2015. Woodford Investment Management made the investment  through two of its portfolios: The £990m Woodford Patient Capital Trust and the £267m Omnis Income and Growth Fund.

 

In addition to the investment from Woodford, Seedrs is set to conduct a crowdfunding campaign to give existing shareholders and new investors to participate. 

 

The fundraising round values Seedrs at £40m on a fully-diluted, pre-money basis. This represents a 27.2 per cent increase in share price from Seedrs’s last fundraising in mid-2015 and a 135.9 per cent increase in share price from its late 2013 funding round.

 

Seedrs says it will use the capital raised in this fundraising round to launch new product capabilities that will "materially increase liquidity and return potential for investors and businesses; build out increased sales and marketing efforts, launch a select set of strategic partnerships, and massively scale campaign execution through automation, machine learning and AI."

 

Jeff Kelisky, CEO of Seedrs, says the new cash will allow the firm to the “next stage of [its] growth".

 

“Equally important to everyone at Seedrs was gaining agreement that we could open up an amount for the crowd. We already have nearly 1000 crowd investors following raises in 2013 and 2015 and many investors were disappointed to miss out on our last round,” he said.

 

While Woodford has one of the best record of any UK equity fund managers over the long term, he has suffered in the past few years or so as the graph below starkly shows. 

 

Woodford vs Peer group over 3yrs

Source: FE Analytics

Comments

Daniel Lanyon

05 Sep 2017 10:46am

Dear Crowd Investor, Thank you very much for your comment and for reading AltFi! Apologies if this seems biased or unnecessarily negative. I assure you it is not the intention and I would argue this is not case. The story points out the positive IRR of Woodford's initial investment in Seedrs which would only serve to boost his performance over the period shown in the graph in the data. Flagging Woodford's performance is important for three reasons, however. Woodford is a contrarian investor, he is directly held by many, many retail investors (unlike Balderton for example) and what he does is very influential. The fact remains, though, that Woodford is facing a challenging period of underperformance and not for the first time. He correctly stayed away from the tech bubble in the 2000s despite a period of underperformance and angry investors calling for him to change tack, which eventually led to his significant outperformance when the market sank. All the best, Daniel Lanyon Editor, AltFi

Crowd Investor

05 Sep 2017 08:58am

Article was good until seeing the last sentence. Seems a bit biased with the negative slant put onto Neil Woodford's performance over recent years. The implication of such is that Seedrs could be correlated with this performance. I'm sure if this was an investment by Balderton Capital for Crowdcube the sentiment would be otherwise. How about seeing this as a superb move for a maturing and growing industry rather than seeking a way to undermine Seedrs' success?


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