CrowdAhead Venture Capital, Business Angels, Government?
CrowdAhead How many people find themselves in this situation?
CrowdAhead Benefits of asking the crowd for funding • Lower costs of raising finance • Global reach for investors • Free Marketing costs for idea testing • Transparency
CrowdAhead Benefits of investing through crowdfunding • Higher returns • Better spread of risks • Ability to participate in otherwise unknown ideas • Feeling of involvement in the idea • Better information than traditional ‘due diligence’ methods
CrowdAhead “Crowdfunding Industry Report”1 • $1.5 billion was raised globally in 2011 through crowdfunding • $584 million was raised in Europe in 2011 • Reward-based crowdfunding is the largest category • Equity-based crowdfunding is the fastest growing • General crowdfunding annual growth rate 63% • Equity-based crowdfunding annual growth rate 114% 1 crowdsourcing.org – May 2012
CrowdAhead CrowdAhead’s intentions • Establish first in UK • Initially focus on equity-based crowdfunding • Raise £200,000 in 2 phases until platform is self- funding • Go live in January 2013 • Cash-flow positive by end of 2013 • Positive cash balances by end of 2014
CrowdAhead CrowdAhead’s revenue streams • Success fee only – set at 5% • Possible future streams • Listing fees • Affiliates • Advertising • Added services
CrowdAhead The crowdfunding market (July’12) • $1.5 billion raised in 2011 of which $ 584 million in Europe • Growth rate: 63% • Growth rate equity based crowdfunding: 114% • Equity based crowdfunding only possible in Europe at the moment – not in the US until 2013 • Expectations: “crowdfunding market could reach $300 billion and will be largely driven by families and individuals investing a small percentage of their assets directly into ventures”2 2Fred Wilson, co-founder of the venture capital firm Union Square Ventures (which has invested in Twitter, Tumblr, Foursquare, and Zynga)
CrowdAhead In the United Kingdom: 204,000 new companies formed in January - June 2010 http://www.bbc.co.uk/news/business-11535932 4,500,000 Small Businesses http://www.fsb.org.uk/stats