Seedrs, the London-based equity crowdfunding service, is expanding its funding platform out to Europe in a bid to attract more investors for its start-up campaigns.
To fund the European rollout Seedrs is listing itself on its site and asking its users to raise the £500,000 needed, in return for an 8.8 percent stake in the business. This gives the company a pre-money valuation of £5.175 million.
“We’re asking investors to back an exciting new way for people to take a stake in businesses they think are worthy of supporting – and to share in the upside if our vision of how successful crowdfunding can be proves correct,” said Seedrs chief executive Jeff Lynn.
The Seedrs platform allows entrepreneurs to create a free listing for their start-up consisting of answers to questions on the feasibility of their idea, market and team, as well as how much money they are looking to raise.
While other crowdfunding platforms like rivals Kickstarter and Indiegogo attempt to attract investors with rewards, Seedrs allows people to back businesses with as little as £10 in return for a chunk of equity.
The European expansion comes after the success of Kickstarter – which has raised $612m (£377m) in funding since 2009.
Seedrs has successfully funded 48 companies in since it launched 16 months ago. Today, it claims to be Britain’s most active crowdfunding platform, averaging three deals per month since launch compared to its closest competitor’s two deals per month. It was also the first equity crowdfunding platform to receive regulatory approval from a financial regulator, the UK’s Financial Conduct Authority.
Seedrs is currently financed with investment from DFJ Esprit, Digital Prophets as well as a number of angel investors.