Every now and then I’ll report on the latest happenings in the ECf world. It’s moving very fast so you don’t want to miss anything. Just two months into 2016 and we have already seen some very interesting developments.
In the USA, Elio Motors, the space age looking three wheeler auto designer, launched a mini IPO on the back of its previous ECf campaign, that raised $17m from 6,600 investors. The company listed its shares at $12 on the OTCQX market on the 19 February and by the end of the month, they were worth $50, valuing the company at $1.3bn. Long term the views are mixed but if you were eligible for the ECf campaign you would certainly now be smiling. It adds more fuel to argument for letting non accredited investors in the US take part in this class of investment.
Back here in the UK, we saw the first major Fintech ECf campaign get off to a false start. Mondo – the app only challenger bank, launched a £1m campaign as part of the £6m funding round which will take them out of beta and bring them into the real world. So popular was the well trailed launch, that the Crowdcube platform suffered sustained outages. Shortly afterwards @Crowdcube and @getmondo were trending on Twitter as Crowdcube had to suspend the campaign. As I write, almost two days later, the campaign is still in limbo*.
The latest Beauhurst report on the growth of equity crowdfunding in 2015 and 2016 has just been released – available here. It shows the growth in importance of this funding source and says that at the seed stage it is now the number one source. It expects ECf to become a major player in the venture stage with deal sizes increasing.
The report states -
“Taking a step back, the biggest story for the market as a whole has to be the continued rise of equity crowdfunding platforms. This is the only investor type whose deal numbers increased by a significant amount (45%) between 2014 and 2015. We expect that, despite the increasing levels of controversy surrounding the sector, it will continue to facilitate more transactions than ever in 2016. As they establish themselves in the mainstream, crowdfunding platforms’ deal sizes will also grow. This may create a virtuous circle of greater investment and greater confidence in the new platforms.”
All good news for Growthdeck.
Source: All: Beauhurst "The Deal 2015/16"
* Update 3rd March: Kudos to Mondo and Crowdcube for a staggeringly fast fund-raise - £1m in 96 seconds. That's true crowd power.