A crowdfunding campaign offering investors equity in the UK’s leading crowdfunding network hit its £500,000 target in a matter of hours, as over 200 investors flocked to support the digital business.
Offering 10% equity, Crowdfunder said it was seeking more money “to turn more great ideas into reality”, giving investors the opportunity to be a part of the platform’s social impact.
After launching its campaign on fellow crowdfunding site Crowdcube on Wednesday morning, it took the start-up only three-and-a-half hours to reach their £500,000 target.
Innovation charity Nesta was the first to pledge towards the equity fundraise, providing £150,000. A further £80,000 was pledged within 15 minutes.
“It’s been an awesome day – a massive endorsement of what we’ve been doing at Crowdfunder – and the sheer power of crowdfunding as a way to raise investment”, said managing director Phil Geraghty.
Crowdfunding is a democratic form of financing that allows people to direct their money towards projects they consider important, innovative and socially useful.
Websites such as Crowdfunder links entrepreneurs and innovators to funding for projects that range from social businesses to art or literary projects.
To date, Crowdfunder has raised over £1.5m for over 4,000 projects. According to the Crowdfunding Centre, the platform supports more projects than all its UK based competitors – challenging global giants Kickstarter and Indiegogo.
“Crowdfunder makes a great investment because we are a digital high-growth business in a fast growing market, but also we are really proud of the social and economic impact that we are having across the whole of the UK,” Geraghty added.
In a blog post, he added, “We know that in order to have the real impact we desire we need to grow, and so we are turning to the crowd.
“I believe that crowdfunding is not just about the funding, its about bringing people together, validating ideas and building communities, I believe the world needs more ideas like the [thousands] we have funded, ideas that come from the grassroots, for the grassroots.”
In 2013, alternative finance intermediaries, including sources such as crowdfunding, peer-to-peer lending and invoice trading, raised almost £1 billion.
This represented a growth of almost 91% in a year – while equity-based crowdfunding alone in the UK grew by 618%.
It is estimated the alternative finance market will continue to grow in 2014, raising up to £1.6 billion as it becomes an increasingly attractive option for individuals and businesses seeking funding, over mainstream banks.
Photo: Emily Whitfield-Wicks