Crowdcube

{{Use dmy dates|date=January 2020}} {{Use British English|date=August 2015}} {{Short description|Equity crowdfunding platform}} {{Infobox website | name = Crowdcube | logo = Crowdcube_Corporate_Logo.svg | logo_size = 200px | location_city = Exeter | location_country = United Kingdom | screenshot = | url = {{url|http://crowdcube.com}} | commercial = Yes | type = Crowdfunding Corporate finance Equity (finance) | industry = Finance | launch_date = {{start date and age|February 2011}} | founder = Darren Westlake and Luke Lang | key_people = Simon Williams (Chairman)<br>Darren Westlake (CEO) }}

'''Crowdcube''' is a British investment crowdfunding platform, established by Darren Westlake and Luke Lang in 2011.<ref>{{cite web|url=https://www.nesta.org.uk/news/20-shades-startup/crowdcube|title=Crowdcube {{!}} Nesta|website=www.nesta.org.uk|language=en|access-date=2017-10-16}}</ref>

==Model== Equity-based crowdfunding is a new fundraising model for entrepreneurs. Individuals' investments are pooled, allowing entrepreneurs to secure funding directly from the general public and bypass business "angel" investors and banks.<ref name=Economist>{{cite news|title=On the side of Angels - New ways of lending to small businesses|url=https://www.economist.com/special-report/2012/02/25/on-the-side-of-the-angels|access-date=4 July 2012|newspaper=The Economist|date=25 February 2012}}</ref> The key principle of this model is that anyone can invest money in return for equity in a business. Entrepreneurs, with a UK registered company, can present their business and its investment potential to potential micro-investors by uploading a ''Dragons' Den''-style video pitch, images, and supporting documents. The minimum investment can be as little as £10.

Crowdcube operates on the "all or nothing" model. When a pitch reaches its investment target, the business receives the funding raised. If it does not, no funds are taken from investors. A commission is charged on successful funding campaigns.

The platform uses social media to a large extent to alert potential investors about an offering. In March 2015, the Financial Conduct Authority released new guidance on the use of social media to promote financial products to ensure that all communications are clear, fair, and not misleading.<ref>Norman, Tessa. [https://www.moneymarketing.co.uk/news-and-analysis/regulation/fca-social-media-rules-create-retweets-minefield/2019598.article/ "FCA social media rules create retweets 'minefield'" Money Marketing, March 2015.]</ref>

Crowdfunding as a model for fundraising has become more popular over the past few years with the rise of the US-based Kickstarter and Indiegogo. These platforms differ from Crowdcube as they work on a donation and reward-based model where the donor receives a product or service in return for their donation.<ref name="The Metro">{{cite news|title=Capital crowdfunders help you beat smart elite|url=http://www.metro.co.uk/news/newsfocus/895019-capital-crowdfunders-help-you-beat-smart-elite|access-date=12 July 2012|newspaper=The Metro|date=3 April 2012}}</ref>

On 12 November 2018, Crowdcube introduced a new investor fee that charges investors for investing on the platform, 1.5% of the total investment, added on when the investment is collected. This fee is capped at £250.<ref>{{cite web|url=http://help.crowdcube.com/hc/en-us/articles/360001527460-What-are-the-fees-for-investing-on-the-platform-|title=What are the fees for investing on the platform?|website=Help Centre}}</ref> The fee was met with some backlash within the Crowdcube community, particularly as it was introduced just before Crowdcube's own raise went live and pre-arranged venture capitalists were exempt. It was also criticised for posting the news of the fees within the FAQs, rather than emailing all the investors.<ref>{{cite web|url=https://www.crowdcube.com/companies/crowdcube/pitches/lOPYXZ/discussions/q4ndNZ |title=Join and Start Investing Today |publisher=Crowdcube |access-date=2020-03-23}}</ref><ref>{{cite web|url=https://www.crowdcube.com/companies/crowdcube/pitches/lOPYXZ/discussions/Z1nAJb |title=Join and Start Investing Today |publisher=Crowdcube |access-date=2020-03-23}}</ref>

==Regulation== In February 2013, Crowdcube received authorisation from the Financial Conduct Authority (FCA) to offer investors the opportunity to become direct legal shareholders in UK businesses.<ref>{{cite news|title=British regulator okays start-up investment website for public|url=http://uk.reuters.com/article/britain-crowdfunding-idUKL5N0B43AO20130204|newspaper=Reuters | date=4 February 2013}}{{dead link|date=September 2024|bot=medic}}{{cbignore|bot=medic}}</ref>

==Successful exits== In July 2015, E-Car Club, an electric vehicle rental business championing the future of the green sharing economy, produced the first exit from the CrowdCube 'Funded Club'.<ref>{{cite web|author=Avi Geller |url=http://www.growthbusiness.co.uk/news-and-market-deals/mergers-and-acquisitions/2488906/europcarand39s-acquisition-of-ecar-club-worlds-first-successful-crowdfunding-exit.thtml |title=Europcar's acquisition of E-Car Club 'world's first successful crowdfunding exit' |website=Growthbusiness.co.uk |access-date=21 April 2016}}</ref> E-Car received a significant investment from Europcar, Europe's largest vehicle rental business.<ref>{{cite web |url=http://www.e-carclub.org/assets/Europcar/Press-Release-Europcar-Lab-takes-majority-stake-in-E-Car-Club.pdf |title=The Europcar Lab takes majority stake in E-Car Club |website=E-carclub.org |access-date=21 April 2016 |url-status=dead |archive-url=https://web.archive.org/web/20160304001427/http://www.e-carclub.org/assets/Europcar/Press-Release-Europcar-Lab-takes-majority-stake-in-E-Car-Club.pdf |archive-date=4 March 2016 |df=dmy-all }}</ref> E-Car club has joined the newly formed Europcar Labs project, which has been set up by CEO Philippe Germond to focus on 'mobility solutions'.<ref>{{cite web|author=Andy Sharman in London |url=https://www.ft.com/content/0268c348-135d-11e5-ad26-00144feabdc0 |title=Europcar plans Paris IPO to fund push into 'mobility solutions' |website=Financial Times |date=15 June 2015 |access-date=21 April 2016}}</ref> This is Europcar's first acquisition since its IPO on the Euronext in early June 2015.<ref>{{cite web|url=https://www.euronext.com/en/news/resounding-success-europcar-listing-euronext |title=Resounding success of Europcar's listing on |website=Euronext.com |date=26 June 2015 |access-date=21 April 2016}}</ref>

In December 2015, it was announced that Camden Town Brewery was being bought by the world's largest brewer, Anheuser-Busch InBev. In a letter to Crowdcube shareholders, AB InBev were offering a payout of between £1.0861 and £1.2526 per share,<ref>{{cite news|work=FT Alphaville|access-date=22 December 2015|date=21 December 2015|url=http://ftalphaville.ft.com/2015/12/21/2148837/heres-camden-town-brewerys-letter-to-shareholders-about-the-ab-inbev-takeover/|title=Here's Camden Town Brewery's letter to shareholders about the AB InBev takeover}}</ref> depending on whether they accept an option with a variable element based on sales growth to be paid at a later date. Reports said this was a nominal return on investment of just under 70%, implying that AB InBev paid around £85 million.<ref name=Guardian>{{cite news|last1=Davies|first1=Rob|title=Camden Town Brewery sold to world's biggest drinks company|url=https://www.theguardian.com/business/2015/dec/21/camden-town-brewery-sold-inbev-worlds-biggest-drinks-company|access-date=22 December 2015|work=The Guardian|date=21 December 2015}}</ref>

In 2019 Parcel2Go, who had raised funds on Crowdcube in 2017, was subject to a management buyout backed by Mayfair Equity Partners.<ref>{{Cite web|url=https://postandparcel.info/117692/news/parcel/mayfair-to-become-majority-shareholder-in-parcel2go/|title=Mayfair to become majority shareholder in Parcel2Go|website=Post & Parcel|date=4 December 2019}}</ref>

==Funded campaigns== ===Equity===

Some examples of companies that have acquired funding using this method are:

{| class="sortable wikitable" style="font-size: 100%; text-align: center;" |- ! Business !! Amount raised !! No. of investors !! Equity released !! Date |- |Freetrade |£8,890,468 |7,170 |1.353% |November 2021<ref>{{cite web |title=Freetrade |url=https://www.crowdcube.com/companies/freetrade/pitches/l8aQNZ |website=Crowdcube |access-date=9 December 2021}}</ref> |- |Cornish Lithium |£5,999,995 |1,012 |6.81% |June 2021<ref>{{cite web |title=Sunswap |url=https://www.crowdcube.com/companies/cornish-lithium-ltd/pitches/qYERNq |website=Crowdcube |access-date=21 June 2021}}</ref> |- |Sunswap |£501,348 |788 |21.18% |January 2021<ref>{{cite web |title=Sunswap |url=https://www.crowdcube.com/companies/sunswap-ltd/pitches/lEJNVZ |website=Crowdcube |access-date=7 February 2021}}</ref> |- |Sliabh Liag Distillers |£2,265,910 |1,158 |13.61% |September 2020<ref>{{cite web |title=Sliabh Liag Distillers |url=https://www.crowdcube.com/companies/sliabh-liag-distillers |website=Crowdcube |access-date=27 October 2020}}</ref> |- |Belluscura |£538,140 |302 |9.6% |April 2019<ref>{{cite web |title=Belluscura plc |url=https://www.crowdcube.com/companies/belluscura |website=Crowdcube |access-date=10 February 2020}}</ref> |- |Monzo |£20,000,000 |36,006 |2.04% |December 2018<ref>{{cite web|url=https://www.crowdcube.com/explore/monzo-crowdfunding-round|title=MONZO HAS RAISED £20M IN LATEST FUNDING ROUND|website=Crowdcube|language=en-GB|access-date=11 April 2019|archive-url=https://web.archive.org/web/20190411211454/https://www.crowdcube.com/explore/monzo-crowdfunding-round|archive-date=11 April 2019|url-status=dead}}</ref>

|- |Recruitive |£1,170,000 |381 |54.64% |March 2018<ref>{{cite web|url=https://www.crowdcube.com/companies/recruitive-software|title=Recruitive Software|website=Crowdcube|language=en-GB|access-date=18 May 2020}}</ref> |-

|- |Manigo |£510,630 |355 |14.33% |January 2018<ref>{{cite web|url=https://www.crowdcube.com/companies/manigo|title=Manigo Services Ltd|website=Crowdcube|language=en-GB|access-date=3 October 2018}}</ref> |- |Parcel2Go |£1,057,730 |1,308 |2.58% |November 2017<ref>{{cite web|url=https://www.crowdcube.com/companies/p2g-com-worldwide-limited|title=Parcel2go.com|website=Crowdcube|language=en-GB|access-date=3 October 2018}}</ref> |- |Kar-go |£321,720 |281 |15.11% |July 2017<ref>{{cite web|url=https://www.crowdcube.com/companies/academy-of-robotics-limited|title=Academy of Robotics raising £300,000 investment on Crowdcube. Capital at Risk.|website=Crowdcube|language=en-GB|access-date=2016-06-06|archive-date=25 October 2017|archive-url=https://web.archive.org/web/20171025075131/https://www.crowdcube.com/companies/academy-of-robotics-limited|url-status=dead}}</ref> |- | Revolut || £1,007,050 || 433 || 2.39% || September 2016<ref>{{cite web |title=Meet the UK equity crowdfunding success stories of 2016 |url=https://startups.co.uk/uk-equity-crowdfunding-success-stories-2016/ |website=startups.co.uk |access-date=7 October 2018}}</ref> |- | Movem || £200,000 || 116 || 20% || September 2016<ref name="forbes.com16">[https://www.forbes.com/sites/alisoncoleman/2016/09/14/crowdfunding-why-startups-are-ignoring-the-risks-and-betting-the-farm/ "Forbes - Why start ups are ignoring the risks"] Forbes, September 2016.</ref> |- | GoHenry || £3,994,980 || 2,372 || 15.98% || June 2016<ref>{{cite web |title=Meet the UK equity crowdfunding success stories of 2016 |url=https://startups.co.uk/uk-equity-crowdfunding-success-stories-2016/ |website=startups.co.uk |access-date=7 October 2018}}</ref> |- | Chilango || £3,433,010 || 1,300 || 8.72% || December 2015<ref name="crowdfundinsider.com">[https://www.crowdfundinsider.com/2015/12/78131-chilango-closes-funding-on-crowdcube-at-3-4-million-will-open-50-new-locations/ "Chilango Closes Funding on Crowdcube at £3.4 Million. Will Open 50 New Locations"] Crowdfund Insider, December 2015.</ref> |- | Adzuna || £2,149,355 || 552 || 5.89% || June 2015<ref name="bmmagazine.co.uk">[https://www.bmmagazine.co.uk/get-funded/success-stories/job-search-site-adzuna-raises-1-5m-via-crowdcube-to-get-britain-working/ "Job search site Adzuna Raises 1.5m via Crowdcube to get Britain Working"] Business Matters News, June 2015.</ref> |- | JustPark || £3,700,000 || 2,919 || 15.61% || March 2015<ref name="techcitynews.com">[http://techcitynews.com/2015/03/17/justpark-bags-3-7m-and-becomes-uks-largest-equity-crowdfunded-startup/ "JustPark becomes UK's largest equity crowdfunded start-up"] {{Webarchive|url=https://web.archive.org/web/20170310080347/http://techcitynews.com/2015/03/17/justpark-bags-3-7m-and-becomes-uks-largest-equity-crowdfunded-startup/ |date=10 March 2017 }} TechCity News, March 2015.</ref> |- | Open Desk || £310,010 || 171 || 18.59% || June 2014<ref>[http://westminster.impacthub.net/2014/06/20/impact-hub-westminsters-first-crowdfunding-venture-opendesk-raise-150k-in-12-hours/ "OpenDesk raise £150,000 in 12 hours"] {{Webarchive|url=https://web.archive.org/web/20150403023926/http://westminster.impacthub.net/2014/06/20/impact-hub-westminsters-first-crowdfunding-venture-opendesk-raise-150k-in-12-hours/ |date=3 April 2015 }} Westminster Impact Hub, June 2014.</ref> |- | SilkFred || £145,610 || 71 || 24.27% || 2014<ref>{{cite web|url=https://www.crowdcube.com/investment/silkfred-ltd-12786|title=SilkFred Ltd raised £120,000 investment - Oct 2013.|website=Crowdcube}}</ref> |- | LOVESPACE || £1,574,590 || 259 || 28.17% || May 2014<ref>[http://www.ukbusinessangelsassociation.org.uk/news/lovespace-hits-%C2%A316m-crowdcube-shazam-venture-capital-firm-adds-%C2%A3250k-to-funding-pot "LoveSpace hits £1.6m as Shazam Venture Capital firm adds £250,000 to funding pot"] {{webarchive|url=https://web.archive.org/web/20150402095004/http://www.ukbusinessangelsassociation.org.uk/news/lovespace-hits-%C2%A316m-crowdcube-shazam-venture-capital-firm-adds-%C2%A3250k-to-funding-pot |date=2 April 2015 }} UK Business Angel Association, May 2014.</ref> |- | Crowdfunder || £500,000 || - || 10% || April 2014<ref>[http://startups.co.uk/reward-based-crowdfunding-platform-crowdfunder-secures-500000-target-in-just-over-three-hours/ "Reward-based crowdfunding platform secures £500,000 target in just over three hours"] Startups, April 2014.</ref> |- | Zero Carbon Foods || £659,480 || 454 || 29.04% || March 2014<ref>[https://www.crowdfundinsider.com/2014/04/35474-growing-tube-141-funding-zero-carbon-foods-crowdcube-campaign/ "Growing under the Tube: 141% Funding for Zero Carbon Food’s Crowdcube Campaign"] Crowdfund Insider, March 2014.</ref> |- | Hab Housing || £1,972,150 || 642 || 26.29% || September 2014<ref>[https://www.managementtoday.co.uk/news/1214132/kevin-mccloud-hit-crowdcube/ "Kevin McCloud is a hit with the Crowd(cube)"] Management Today, September 2013</ref> |- | E-Car Club || £100,000|| 63 || 20% || December 2012<ref>{{cite web |title=E-Car Club Ltd |url=https://www.crowdcube.com/investment/e-car-club-12191 |website=Crowdcube |access-date=7 October 2018}}</ref> |}

===Bonds===

Bonds allow members of the public to lend money to the issuing company in return for interest and/or rewards. Mini-bonds have "particular appeal for established businesses".<ref>Bridge. Rachel, [https://web.archive.org/web/20141223151803/http://www.telegraph.co.uk/finance/festival-of-business/11303322/Soapbox-Established-businesses-should-consider-using-crowdfunding-too-says-Adam-Blaskey.html "Soapbox: Established businesses should consider using crowdfunding too, says Adam Blaskey"] Telegraph, December 2014.</ref> In June 2014, Chilango launched Crowdcube's first mini-bond campaign. Since then, several other businesses have launched mini-bond offerings via the Crowdcube platform. Some of the businesses that have funded bonds via Crowdcube include:

{| class="wikitable" |- ! Company !! Amount raised !! No. of investors !! Interest paid !! Date |- | Brew Dog|| £2,312,000 || 815 || 6.5% || Oct 2015<ref>{{cite web|url=https://www.crowdcube.com/investment/brewdog-bond-20331 |title=BrewDog Bond raising investment on Crowdcube. Capital at Risk |website=Crowdcube.com |access-date=21 April 2016}}</ref>

|- | Taylor St Baristas || £1,805,000 || 493 || 8% || Jan 2015<ref>[http://startups.co.uk/niche-coffee-house-chain-taylor-st-baristas-secures-1-8m-crowdcube-mini-bond/ "Niche coffee house chain Taylor St Baristas secures £1.8m Crowdcube mini-bond"] Startups, Feb 2015.</ref>

|- | Eden Project || £1,500,000 || 355 || 6% || October 2014<ref>[https://www.bbc.co.uk/news/uk-england-cornwall-29587770 "Eden Project crowdfunding raises £1.5m in 20 hours"] BBC News, October 2014.</ref>

|- | River Cottage || £1,000,000 || 285 || 7% || June 2014<ref>[http://realbusiness.co.uk/article/26990-fearnley-whittingstalls-river-cottage-raises-1m-through-mini-bonds/ "Fearnley-Whittingstall's River Cottage raises £1m through mini bonds"] Real Business, June 2014.</ref>

|- | Chilango || £2,035,000 || 347 || 8% || June 2014<ref>[https://www.forbes.com/sites/trevorclawson/2014/08/28/will-chilangos-2m-success-herald-an-affordable-mini-bond-revolution/ "Will Chilango's £2m Success Herald An Affordable Mini Bond Revolution?"] Forbes, June 2014.</ref> |}

==Events==

===Caterham F1=== In November 2014, Crowdcube partnered with Caterham F1 to raise £2.35 million to fund the team for the final Grand Prix of the season in Abu Dhabi.<ref>{{cite web|last=Wise |first=Mike |url=https://www1.skysports.com/f1/news/17583/9554099/caterham-are-launching-a-crowdfunding-project-to-make-the-abu-dhabi-gp |title=Caterham launch crowdfunding project to fund team's return for the Abu Dhabi GP | F1 News |website=Skysports.com|date= 25 November 2014|access-date=21 April 2016}}</ref> Designed to empower F1 fans to help Caterham return to racing, the project was successfully completed on 14 November,<ref>{{cite web|last=Strickland |first=Jamie |url=https://www.bbc.co.uk/sport/formula1/30055510 |title=Caterham to race in Abu Dhabi finale after fundraising success |publisher=BBC Sport |date=14 November 2014 |access-date=21 April 2016}}</ref> with Caterham F1 finishing in 17th place with Grand Prix newcomer Will Stevens.<ref>{{cite web|url=https://www1.skysports.com/f1/grandprix/unitedarabemirates/results/2014 |title=Past Results - Abu Dhabi Grand Prix |website=Skysports.com |access-date=21 April 2016}}</ref> Caterham F1 went bankrupt in 2015.<ref>{{cite web | url=https://www.bbc.com/sport/formula1/31144177?#38; | title=Caterham hopes fade as team's remaining assets go up for sale | publisher=BBC|first=Andrew |last=Benson |date=5 February 2015| access-date=13 April 2016}}</ref>

==References== {{Reflist}}

==External links== * {{Official website|http://crowdcube.com}}

Category:Crowdfunding platforms of the United Kingdom Category:Economics websites Category:Equity crowdfunding platforms Category:Financial services companies established in 2011 Category:Internet properties established in 2011