While the news of startups getting successfully purchased by multibillion dollar business deals is not surprising anymore at the same time new platforms are making this space competitive and increasingly difficult for the founders to choose the right platform for their campaigns.
While a solid business plan and monetization strategy is fundamental to any startup, the choice of the platform is equally important. Each platform brings unique advantages and more importantly unique collection of audiences (INVESTORS). Interestingly these platforms over the years have been able to create a definite trust among their investors. That’s why two similar looking campaigns may perform differently in different platforms.
We will discuss below the best equity crowdfunding platforms of 2021 and what benefits they might bring to your campaign.
According to information published by SEEDRS- In the first 6 months of 2021 alone over €22M has been invested into 23 European campaigns on Seedrs, which is already 101% of the total investments raised in 2020 for European businesses on the platform. Which says a lot about their trusted investors Interestingly this UK based platform has already featured campaigns from 22 different European countries with over 29000 investors that have backed up those startups. A very good reason for an equity crowdfunding campaign to get listed here.
To date more than 1.1 million private investors have invested more than £1 billion through Crowdcube in to more than 1000 startups, this data speaks for itself, that means there is a high probability that campaigns will reach their funding target. Crowdcube also has lots of service partners in case a startup needs additional services, from making Pitches to video to marketing everything is under one roof. As one of the first platforms to offer equity crowdfunding back in 2011 it gained its popularity by allowing everyday investors to invest alongside professionals.
Sweden’s FundedByMe is one potent important platform in Europe and has received quite a lot of press coverage including the Gurdian and TechCrunch. Over Eur73 million has been raised by this platform successfully and it accepts investment internationally and as per the information shared by FundedByMe they have gained more than 5k investors from over 36 countries. The platform has a 3-step simplified process which revolves around a 45-day campaign.
As per Wefunder the platform is meant for those following the “American dream” as it accepts only US based startups but accepts investments internationally. It is the largest crowdfunding platform in the US by number of investments. As of September 2020, the company has raised over $122 million for companies conducting Regulation Crowdfunding campaigns, $36 million for companies doing Regulation D fundraising, and over $9 million for companies running Regulation A+ campaigns. It is considered good for startups with exponential growth potential.
Accepting only 1% of the startups that apply to the platform, SeedInvest is an exclusive marketplace and only in 2020 and has signed up more than 200k new investors. SeedInvest has listed a broad range of company’s looking for funding, from robotics through to food and beverage alongside a number of interesting healthcare startups. SeedInvest is different. They feature only highly vetted investment opportunities thereby increasing the loyalty and trust of their investors at the same time it is difficult to get accepted for listing on the platform. All startups must be registered in US but SeedInvest accepts investments from outside the United States as long as local laws and requirements are met.
Startengine makes raising capital easy by giving complete control over the campaign. With a base of over 500k potential investors it is a very lucrative platform for any startup. The simplicity of this platform really makes it apart from other platforms for both investors and startups. In the first quarter of 2021 StartEngine has raised $57million with 52 companies launched and 80k additional investor signups making it the most successful platform for the first quarter on 2021. As normal with other US based platforms it accepts investments internationally but accepts only US based startups.
Republic – USA
Republic allows anyone to invest in vetted private startups. Less than 3% of startups that apply pass through their due diligence and investment committee which makes it a very highly trusted platform for the investors. Republic is investor-friendly by design with no hidden fees and top-rated customer service.
Good thing it is accessible to everyone, with lowest minimum of $10 means an investor can invest in a really diversified portfolio. Renowned Venture capitalists invests in Republic alongside everyday investors making it a really exciting offering.
Invesdor – Finland
Invesdor is a North Europe based platform and is currently active in 6 European countries and offers investment opportunities for a variety of startups. But they are famous for their Fintech based startups.
Invesdor Group operates two digital investment platforms: Invesdor.com and Finnest.com. Of the two platforms, Invesdor.com offers mostly equity issues by Finnish and Nordic companies, whereas Finnest is more specialized in mezzanine funding and their target companies are mostly from the German-speaking DACH market. The numbers for 2020 as declared by Invesdor says that the group platforms together raised €29 Million with an average investment size of €4,860 where Eleven funding rounds raised more than €1M. Of these, four rounds passed the €2M mark.
Mamacrowd is the leading Italian equity crowdfunding platform for capital raised and is managed by SiamoSoci, Italian leader in matching investors and the unlisted world.
At Mamacrowd, the selection activity is so detail-oriented that only 5% of candidate companies make it to the platform. Another distinctive element of Mamacrowd is the network of partners it works with. Many of the companies that come to the platform have also been validated by their partners and are within their portfolio. Mamacrowd so far has been able to launch 125+ projects with 97k + investors and more than €90 million invested.
With over 100,000 members, Companisto is Germany’s largest investor network for start-up investments. Everyone can be an investor and investment start from just €500. Companisto finances startups and growth companies in all industries with up to € 8 million in equity per year. The period between initial contact and investment payout usually spans only a few weeks, be it early-stage financing from € 500,000 or growth financing. The conditions for financing through them are that your company is located within the DACH region, the capital requirements exceed 500,000 euros and the business model is scalable.
Importantly, the company must already have sales, customers or a market-ready product. All these means it’s difficult for small startups trying to launch their idea and good for MSE’s trying to get their additional capital.
|Seedrs– new fee structure is 6% fee on all funds raised, £2,000 completion fee (excl. VAT),0.5% payment processing fee|
|Crowdcube– a success fee of 7% (exc. VAT) is only charged on the amount you successfully raise A completion fee, which is on average 0.75% -1.25% of all funds raised, is also applied. This fee includes our third-party payment provider’s variable costs and the cost of collecting, reconciling and distributing the funds raised.|
|FundedByMe charges a listing fee of SEK 29 000 (EUR 2 900) to list your business post having successfully gone through the application process. They charge a platform fee of 8%(exc.Vat) on the amount you successfully raise. All fees are payable to Fundedbyme Crowdfunding Sweden AB|
|Wefunder – the company is charges up to 7.5% of their total funding volume for Regulation Crowdfunding. For Regulation D, Wefunder charges up to 20% Carried Interest. For Regulation A+, Wefunder does not charge any fees.|
|Seedinvest– Placement fee: 7.5% of what you raise on SeedInvest. Equity fee: 5.0% of what you raise on SeedInvest. Only pay if your fundraise is successful. Up to $3,000 of accounting fees reimbursed upon campaign launch|
|Startengine– Charge of 7%-12% (based on the method of investment and fees associated.) of total capital raised for Regulation Crowdfunding offerings, an additional 2% of what you raise in equity, as well as $10K in deferred revenue that they collect when the offering is complete.|
|Republic– Companies pay only if they successfully reach their funding goal: 6% of the total funds raised in cash, and 2% as a Crowd Safe(equity).|
|Invesdor-pricing is always built on three parts: a fixed up-front listing fee, plus a percentage-based success fee if the funding round is successful. In some rounds we may charge an administrative fee of up to 1% from the investor.|
|Companisto– charges a performance-based commission of 15 percent of the collected investment sum from the companies for the entire handling of the financing round. This also includes the costs for the entire payment processing. In addition, there is a fixed administration fee of 0.65 percent of the funding sum for all administrative activities carried out by Companisto for the company.|
A marketing/communication strategy is fundamental for the campaign’s success. just putting up the project in the platform doesn’t mean the campaign will achieve its goal. SCAI communication over the years have helped more than 90 campaigns reach their funding objective through their dedicated marketing channels, carefully curated content and a robust network of trustworthy clients. SCAI believes in a win-win partnership.
Equity Boost is SCAI’s exclusive service that includes various targeted communication actions and includes direct investment in the campaign.
It’s made for start-ups with a pre-defined communication campaign but probably without a budget or proper understanding of how to utilize it. SCAI believes in making things simple for clients! SCAI promotes the campaigns through specific media assets dedicated to equity crowdfunding. Importantly it augments the campaign visibility, puts it in front of thousands of investors that we have curated over the years. Contact SCAI Comunicazione today!