Crowdcube investment figures defy Brexit gloom

Crowdcube has seen a strong upswing in investment through its platform since the decision to leave European Union (EU) last June. In the six months since the Brexit vote, Crowdcube reports investment on its platform is up 20 per cent. It finished 2016 on a high with its best quarter since the platform launched in 2011.

The platform says the figures show investors’ appetite for backing innovative and exciting businesses continues despite Brexit.

Crowdcube, which celebrates its 6^th birthday this month, has seen the total investment on its platform reach £210m. Since its launch it has seen a number of changes in investment behaviour:

• Investment in 2011 was just £2.2m (9 businesses) in 2011, compared with £80m (121 businesses) in 2016
• The average raise for a business was £239k in 2011, but in 2016 it was £642k
• The Crowdcube investor community has grown from 8,000 in 2011 to over 340,000 
• The largest funding round is up tenfold in six years to £10m in 2016 (BrewDog)
• London, the South West and South East maintain the top three regional slots for funded businesses, but the North West is rising up through the ranks thanks to the Crowdcube North office

Luke Lang, co-founder of Crowdcube, said: “Brexit may be the word on everyone’s lips, but investment through Crowdcube over the last six months has been vibrant, with crowdfunding records being broken in terms of the size of investment rounds and the speed at which companies are funding.”

“While the Government tackles the economic and political outfall of the decision to leave the EU, we believe British businesses are becoming more attractive to investors right now, particularly with the country’s reputation as a centre of excellence for fintech and other highly disruptive startups."

“However, the Government needs to stop paying lip-service and step up to support entrepreneurs more. Announcing £400m of funds last year was a start, but limiting this investment to traditional VCs fails to recognise the influence that crowdfunding has had, and will continue to have, on growth businesses in this country.”

As the crowdfunding industry continues to mature, Crowdcube has also seen a trend for more co-investment, with crowdfunding forming part of a larger investment round alongside VCs and institutional investors, and also a move towards corporate venturing, recently seen with Aviva Ventures’ first investment in the smart tech startup, Cocoon.