Equity crowdfunding platform Seedrs has announced a GBP4 million investment by Woodford Investment Management, through two Woodford-managed funds, Woodford Patient Capital Trust and Omnis Income and Growth Fund.
This investment follows on a GBP6 million investment in Seedrs made by Woodford in 2015. In addition to the investment from Woodford, Seedrs will conduct a crowdfunding campaign to give existing shareholders and new investors the opportunity to participate.
The fundraising round values Seedrs at GBP40 million on a fully-diluted, pre-money basis. This represents a 27.2 per cent increase in share price from Seedrs’s last fundraising in mid-2015 and a 135.9 per cent increase in share price from its late 2013 funding round.
Seedrs will use the capital raised in this fundraising round to launch new product capabilities that will materially increase liquidity and return potential for investors and businesses; build out increased sales and marketing efforts, launch a select set of strategic partnerships, and massively scale campaign execution through automation, machine learning and AI.
Speaking about the round, Jeff Kelisky, Chief Executive Officer of Seedrs, says: “We are thrilled to have Woodford leading the round with GBP4 million, taking their total investment into Seedrs to GBP10 million. The capital we are raising will allow us to deliver our next stage of growth. Equally important to everyone at Seedrs was gaining agreement that we could open up an amount for the crowd. We already have nearly 1000 crowd investors following raises in 2013 and 2015 and many investors were disappointed to miss out on our last round.”
Seedrs writes that this latest round of fundraising comes after it has funded over 510 deals with more than GBP250 million invested into campaigns on the platform including a GBP3.8 million round for Revolut from over 4,300 investors in August.
The company launched the equity crowdfunding sector’s first Secondary Market in May 2017, from which, it reports, some investors have realised up to 19x returns on their investments. Seedrs has also become the sole equity crowdfunding platform appointed to the Royal Bank of Scotland Capital Connections Programme in May 2017.
Seedrs reports that Landmark analysis shows that on a fair value basis as of 30 September 2016, investing through Seedrs has produced better annualised rates of return (IRRs) than most other asset classes with platform-wide IRR increases from 14.44 per cent to 49.1 per cent when impacts of SEIS and EIS tax reliefs are taken into account.
The firm has also worked closely in partnership with Sir Andy Murray, who has now backed almost 30 early-stage businesses on Seedrs, promoting the success of European SMEs. AlphQ interviewed Seedrs founder Jeff Lynn, pictured, in the June 2016 issue.