Tag Archives: Seedrs News

Seedrs Acquires Junction Investments and Will Expand to the United States

I am very pleased to announce that Seedrs has acquired California-based Junction Investments.

We plan to use this acquisition to expand to the United States in early 2015. Junction’s co-founders, Adam Kaufman and Brian Goldsmith, are now Co-Heads of Seedrs America, and they will be leading this expansion.

The Seedrs and Junction teams are very excited about the opportunities that our combination creates, and I wanted to share some background to the transaction and an overview of next steps.Seedrs USA

A Global Platform

A founding principle of Seedrs is that investment in startups and growth businesses should be global. We believe in a future where entrepreneurs and investors from all over the world can connect online. Investors should be able to discover and invest in opportunities anywhere, and entrepreneurs should be able to access capital worldwide.

Financial regulation remains largely national or regional, however, and compliance with applicable law has always been a non-negotiable element of Seedrs’s approach to business. Building a global platform is thus a multi-stage process that involves identifying the right approaches and partners in different jurisdictions.

Having opened across Europe at the end of 2013, we began to look at the U.S. market at the beginning of this year. The U.S. has been slower to embrace equity crowdfunding than the UK and Europe have, and full-scale crowdfunding is not yet possible there. But with the opening of online investment to accredited investors at the end of last year (under Title II of the JOBS Act), and the prospect of wider crowdfunding on the horizon (under the yet-to-be-implemented Title III of the JOBS Act, or an amended version thereof), we feel that now is the right time to begin building our U.S. presence.

Junction

Adam Kaufman and Brian Goldsmith are two exceptionally impressive individuals. Adam is a graduate of Columbia University and Yale Law School and has worked as a corporate lawyer with Wachtell, Lipton, Rosen and Katz (one of New York’s pre-eminent law firms) and as an investment banker with Goldman Sachs. Brian, a graduate of Harvard University and Stanford Law School, served as a producer for the CBS Evening News, one of the leading television news programmes in the United States.

Adam and Brian came together to found Junction in 2012. Their vision and ethos were similar to ours: they wanted to provide a simple and straightforward way for a wide range of investors to access growth assets. They decided to focus initially on investments in entertainment assets, including Hollywood films, before expanding more widely.

Over the past two years, the Junction team has done a remarkable job of building the foundation of a great business. Among other things, they have built out an exceptional set of relationships in the investment and business communities, and they have gone through the arduous process of establishing a registered broker-dealer and an investment adviser (the two regulated entities that cover the equivalent of our FCA permissions).

At the same time, Adam and Brian believed that combining with a platform that already had significant reach and resources would allow Junction to move further and faster than it could have done on its own.

The Transaction

The management teams of Seedrs and Junction have been in contact for nearly a year, and it has been obvious from the outset that we would be a great cultural fit. We share a passion for connecting investors with opportunities to invest for growth, as well as a commitment to professionalism, investor protection, and compliance.

We began talks around a potential acquisition over the summer, and both sides quickly realised the tremendous potential a deal would have. We believe Adam and Brian represent the ideal partners to launch our U.S. operation. Meanwhile, the Junction team saw that joining forces with Europe’s leading equity crowdfunding platform could provide a powerful opportunity for rapid growth, both in the United States and internationally.

After several months of discussions, we signed documentation last month, and the acquisition closed on October 27, 2014.

Next Steps

Over the next few months, we will be working hard to launch Seedrs in the U.S. market, and we will announce when we are ready to go. In the meantime, American residents are welcome to sign up to Seedrs and have a look around, although they will not yet be able to invest or raise capital.

We believe that, as a combined company, we can do great things together, and we can’t wait to get started.

Deposit, invest and create campaigns with euros

Euro crowdfunding

Since we opened up to Europe last November, a lot has happened. Investment through the platform has increased more than 4X and we’re averaging just over £1 million per month in funded campaigns. Around 35% of new investors have come from outside of the UK – we are very proud to now have users from almost every country in Europe (although we are still looking for our first investors both from Liechtenstein and the Holy See, but it shouldn’t be long before people there start using Seedrs). We beat the previous equity crowdfunding world record by raising £2.6 million for our own campaign from 909 investors, and are very happy that our record’s since been broken by British winery and craft brewer, Chapel Down. Because we just can’t settle, we also introduced – for the first time ever in equity crowdfunding – convertible equity investment and equity crowdfunding for a listed company. All of these are tremendous accomplishments, but there has been something missing.

We lacked support for investing and raising investment in euros. Not anymore.

We have never been shy about our international ambitions and, in line with that, Seedrs is now a fully multi-currency platform, with support for euros and British pounds (more currencies coming soon).

While it hasn’t put off European investment activity, this has been a feature in high demand from our users for quite some time. With part of the Seedrs team being based outside of the UK, we were definitely sympathetic.

Although hacking support for euros may seem like something that could have been done in less than 10 months, we strongly believe in truly excelling in terms of usability and simplicity for our users. So, quickly implementing a half-baked solution that would make the whole experience clunky and unreliable was not an option. We took our time. We wanted to learn how users from outside the UK were using the platform and we wanted to develop a solution that was simple, easy and reliable.

Any Seedrs user can now deposit, invest and create campaigns in either currency.

More importantly, we have created what we believe is a seamless experience and a smooth exchange between the two currencies. To achieve this, we worked together with our good friends at Currency Cloud (who process more than $7B in payments every year, across more than 40 currencies) to provide you with the ability to instantly, and securely, move funds between euros and GBP.

So, if you login to your Investment Account, you will see that you now have a GBP and EUR balance (at least for the time being, one of them is probably at 0). When you click “Deposit”, we pre-select the account that has most of your funds – but you can choose to deposit directly in another currency. If you already have funds, let’s say, in your GBP account and want to pay for an investment made in EUR (the first EUR campaign is right around the corner!) all you have to do is click “Transfer” to move funds from one account to the other. This action is completed instantaneously and funds will be displayed in your Seedrs account. It really couldn’t be simpler.

Our hope is that this improves your experience with Seedrs – especially for users in Europe.

Veeqo on raising startup funds from the crowd

Recently, Veeqo reached its investment target on Seedrs and decided to share their investment journey and crowdfunding advice on their blog. They’ve given us permission to re-post below.

Inventory management startup

Veeqo helps companies manage inventory across multiple channels.

This week, Veeqo founder Matt Warren explains how he funded Veeqo’s start-up costs using the Seedrs crowd-funding platform.

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Expanding Startup Eligibility on Seedrs

Until recently, we have restricted Seedrs to pre-revenue businesses which hadn’t yet made money from their core business model. We imposed this restriction because we believe firmly that there is a profound gap in funding at the very earliest stages, and that seed-stage businesses can represent exceptionally attractive investment opportunities due to their valuations, growth potential and tax advantages.

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Seedrs FSA Authorisation

After two years of preparation and a year-long application process, Seedrs was authorised by the Financial Services Authority (FSA) this past Friday, 18 May. Our application had been approved in March, but now the final technicalities are all wrapped up. You can see our entry in the FSA Register by searching for Seedrs.

FCA (formerly the FSA)

FSA is now known as the FCA.

I want to say a word about why we see FSA authorisation as so critical, especially given that there are other platforms in the market that have been operating without it.
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Welcome to the Seedrs blog

Three years ago, Carlos and I set out to build a platform that allows ordinary people to invest in startups in a straightforward and efficient way. The term “crowdfunding” hardly existed at the time, and while peer-to-peer lending platforms were already achieving some success, we knew that the legal and operational issues involved in doing equity would pose a much tougher challenge.

As we now approach launch, it’s fun to look back on the hurdles we’ve overcome to get to this point. Achieving FSA approval (making us the first equity crowdfunding platform anywhere in the world to get regulatory approval), raising over £1 million in our own capital, building an amazing product, hiring a brilliant team and meeting thousands of dynamic, supportive people along the way has been a truly wonderful experience.

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