Founded in 2012, Seedrs is one of the dominant players in the UK crowdfunding and investment landscape, enabling investors to own shares in unlisted (and recently listed) companies from as little as £10.
On a mission to help ambitious businesses in all sectors to raise capital and build communities, we caught up with Katherine Gilroy, Senior Associate, to share how businesses can maximise their chances of success on the platform and leverage the power of their communities to raise investment.
My role is to source seed-stage businesses for the platform, plus I advise entrepreneurs thinking about raising funds and help them to get crowdfunding ready. As Diversity Lead, I also advocate for underrepresented founders and work to ensure that the platform supports as many founders from underrepresented backgrounds as possible.
To date, we’ve helped to raise £1.2BN across over 1,350 investment rounds, including for the likes of Revolut, Allplants, Heights, and Urban. More recently, we’ve begun to offer opportunities in public companies, VC Funds and secondary fundraises as well – more on that later!
A combination of an exciting business idea, well-executed by a killer team, and supported by an engaged community will always set a business up for success on the Seedrs platform. More practically, a business will need to know where its first capital contributions are coming from so that they can build initial momentum and then capitalise on this.
Platform investors tend to invest with both their head and their heart, so we’re also looking for fair valuations and a pitch that will excite.
They are the ones powered by a community. They bring with them an army of super fans, whether that be early adopters, customers who have religiously followed a brand for years, or personal and professional contacts, who want to support and share in the success of the brands and businesses they love.
By building on the initial momentum from their own community they’re able to engage the wider crowd – and that’s when things get really exciting.
Whilst perhaps best known as an equity crowdfunding platform, Seedrs is actually a full private investment platform. In 2021 alone we have run primary campaigns for the likes of Lick, secondary campaigns (releasing value for founders and early investors) for The Cheeky Panda, raised the first VC fund from crowd investors for Passion Capital, raised investment for Chapel Down (a publicly listed company), and funded the first joint US/UK crowdfund with US platform Republic for fintech Glint. On top of this, we have a fully functioning Secondary Market where we’ve sold over £10m share lots since its launch in 2017.
As a platform, we have innovated our product to provide liquidity for both our entrepreneur and investor communities so we can support them throughout the entire lifecycle of a fundraising and entrepreneurial journey. We pride ourselves on doing things first and doing them properly.
I’m often asked when a business should start preparing for a crowdfunding campaign and my advice is – it’s never too early to start!
Businesses like Livia’s, The Vegan Kind, and Heights did a phenomenal job of engaging their community during their Seedrs raise, because they’d nurtured and looked after their customers and supporters from day one. When those brands gave their communities the opportunity to own a part of the business, they jumped at the chance!
Arguably the best example of this, though, was AFC Wimbledon’s campaign to fund their new stadium. Over 5,000 fans invested and helped the football club to raise over £2.3M in one of the most powerful examples of a community-based raise on our platform – engaging and rewarding the people who loved the Club the most and giving them some pretty cool investor-perks in the process too!
Whilst it’s tempting to want to rush to get your campaign live and up on the platform – don’t skip any steps!
Pre-registration is the most important part of a crowdfunding campaign. This pre-live phase allows you to create hype and excitement and get your community ready to invest in your round. It ensures your existing fans get early and exclusive access to your campaign, are ready to invest once you go live, but crucially gives you the data you need to ensure you’re going into your crowdfund with your eyes open. We run this for every business we work with!
A well-executed pre-registration campaign means you can have a quick and impactful private phase, before launching in public on the Seedrs platform in a strong position, forcing our investors to sit up and pay attention from day one. If your campaign starts slowly, chances are it will fund slowly too.
It’s really simple: communication.
Keeping your customers, investors, and prospective investors engaged and updated in the build-up and throughout your campaign is the key to converting as many of them as possible. Make full use of all of the communication channels available to you including emails, social media and the updates function on your campaign – letting people know how the campaign is progressing but also celebrating any business achievements you land during the campaign too.
A big part of crowdfunding is building excitement about your business – not just your investment round – so if you hit a milestone or land a win make sure you use the platform to shout about it. The founding team should also continue to hustle their own networks whilst a crowdfunding campaign is live as you never know who is watching!
The most common mistake we see is founders believing that crowdfunding is an easy way of raising investment – unfortunately, there is no easy way to raise money!
The public success stories you see are really just the tip of the iceberg of all of the work that goes into running a successful campaign, from both the business raising investment and the Seedrs team.
Sometimes a team won’t dedicate enough resources to their campaign, they’ll place too much of a reliance on the platform alone, or they won’t take advice on where to set their minimum investment target. Even if you’ve raised funds before, crowdfunding is a very different process, so seek as much advice as you can to set yourself up for success.
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