Whether you are looking to launch a unique tech startup or have been trading for some time and wish to take your new business to the next level, the likelihood is that you will require seed funding in order to get your startup off the ground and meet your market potential. Here at Lime Advisory, we have been supporting the UK startup community for many years, providing them with access to the financial products they need to scale, recruit and market.
In recent times, crowdfunding has become a popular investment avenue for startup businesses.
What is startup crowdfunding?
Startups crowdfunding is a method used to gain investment, allowing both individuals and organisations to invest in businesses in exchange for a share of the startup’s profits or an equity share in the business. There are even some crowdfunding options where investors can simply donate to a startup project to help entrepreneurs accelerate their launch.
If you’re considering creating a crowdfunding page in order to raise capital then there are many channels you can do this via. Some of the most popular include:
Seedrs – Seedrs is arguably the most successful equity crowdfunding platform there is, having been in operation since 2012. With a tremendous amount of marketing power and an ever-growing pool of investors and co-investors, Seedrs makes it easy to build and market your investment opportunity to the masses. Currently, Seedrs charge 6% on all funds raised. However, with more than 80% of campaigns exceeding their target on the platform, these fees are pretty minimal.
Crowdcube – Crowdcube is another online portal that helps businesses grow through equity crowdfunding. With a million-strong community of investors, Crowdcube permits investors to invest as little as £10 in a single venture!
Fundly – As its name suggests, Fundly supports startups in sourcing funds for their businesses. Via the platform, businesses can connect with donors and tell their story, utilising digital content to market their venture through a dedicated Fundy page.
Indiegogo - Indiegogo is a launchpad for startup ideas. With a community of 9 million active backers, the site has helped bring more than 80,000 early-stage businesses across more than 200 countries. The platform has a great reputation for supporting tech startups in their funding missions.
Below, we explore the idea of crowdfunding for seed capital, focusing on the advantages of this fundraising method.
Speed
If you are in need of capital quickly then creating a crowdfunding campaign may be a great option for you, allowing you to gain access to money quickly. With crowdfunding pages taking minimal time to develop, it is ideal if you don’t have time on your side. Please note that after you have developed your page, there may be a clearing/validation process, meaning it could take a few days for your crowdfunding page to go live.
Attract a wide pool of active investors
The slog of trying to find an investor that understands your business, vision and the potential returns they can expect can be difficult. By posting your investment opportunity on a crowdfunding website, you can advertise your startup to a targeted investment pool that is actively seeking opportunities like yours! This will save you a considerable amount of time, only approaching investors that will actually be interested in your venture.
Generate media attention
As well as gaining access to the funds you need, conducting a crowdfunding campaign can also result in high levels of media attention, with investment and finance publications always eager to promote startup investment opportunities and unique startup stories. With PR coverage being invaluable to startups, this is a significant advantage of a successful crowdfunding campaign.
How Lime Advisory can enhance your crowdfunding campaign
At Lime Advisory, we have supported many new businesses throughout the crowdfunding process, helping create a strategic funding plan, advising on which crowdfunding routes to go down and taking care of all the paperwork that this type of investment deal requires.
If you would like to discuss conducting an investment crowdfunding campaign, feel free to contact us today for an informal chat about your business and your financial requirements.
