
The study came from February-launched equity crowdfunding service Growthdeck, which sought to highlight the tricky challenge investors have when it comes to understanding the strength of the business opportunities before them.
The company looked across six British crowdfunding platforms – including Crowdcube, Seedrs, AngelsDen, GrowthFunders, SyndicateRoom, CrowdBnk – and found that just nine of 115 companies looking for investment are profitable, according public company accounts. By comparison, 41 companies (equivalent to 36 per cent) have not yet filed account details with Companies House. As a result, Growthdeck’s co-founder Gary Robins suggested that existing platforms should be more selective of the businesses they approve, so that stronger investment opportunities with lower risks are provided.Read more on the crowdfunding industry:
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“Although investors may be attracted to invest in businesses where they see significant potential despite a lack of track record, too much exposure to early stage businesses could be a risky strategy,” he said.
While many of these companies may be lacking in profits, campaign runners often have no shortage of imagination – we found this out by highlighting the five most outlandish crowdfunded business ventures.
By Zen Terrelonge Image: ShutterstockShare this story