Role and company:
Co-founder of Crowdcube
We currently have nine employees, of which more than half work in customer-facing roles. We are also enthusiastically growing our software development team to ensure that Crowdcube continues to be the leading crowdfunding platform on the planet.
Growth forecast for the next three years:
Crowdfunding, particularly the equity model, is still in its infancy and we forecast strong growth over the next three to five years as the market develops and matures.
In under 50 words, what makes your business distinctive in its marketplace:
Launched in February 2011, Crowdcube is the world’s first equity-based crowdfunding platform. It enables entrepreneurs to showcase their business’s investment potential online and raise finance from a nation of “Armchair Dragons” in return for shares. To date (mid Jan 2013) 34 British businesses have raised almost £5m through Crowdcube.
What’s the big vision for your business?
Our aim is for Crowdcube to be the dominant brand in the UK for entrepreneurs looking to secure equity finance. The democratisation of investment remains an underpinning thread of our founding philosophy; we’re passionate about getting more people interested in investing and actually investing in UK businesses. We want to see the British public’s knowledge and experience of equity investment develop so that equity finance becomes the catalyst for start-up innovation as it is in the USA.
Current level of international business, and future aspirations:
We have partnerships with reward-based crowdfunding websites in Europe and South America whereby we provide the technological infrastructure for a crowdfunding platform in their country. It works very well, but we are keen to expand our brand overseas, starting in Europe and North America; the latter being an obvious target due to the JOBS Act being brought into law in 2013 in the US. The size of the market, people’s attitude towards equity investment and the changes in regulation all make it an attractive opportunity for us.
Biggest career setback and what you learned from it:
I’m still waiting for a setback that didn’t turn into a fantastic opportunity further down the line!
What makes you mad in business today?
Poorly thought-out, written and presented business plans. If you are going to ask someone to invest in your business you need to make an effort.
What will be the biggest change in your market in the next three years?
The crowdfunding industry was in its infancy only two years ago, but is already seeing huge growth with new niche sites popping up across the world at an incredible rate. I suspect that many of these will fail and the remainder will go through a period of consolidation as they battle to increase market share. I predict a similar trend in equity crowdfunding which has been slower to take off due to regulatory constraints, but has much greater potential than the traditional rewards model that is geared towards smaller, often creative, projects.
I also believe the notion that investing in start-up and early stage businesses will become more mainstream as more people turn their hand at being an “Armchair Dragon”. Investors will also become more sophisticated as they begin to diversify their portfolio of investments in unlisted securities and beyond into other investments such as property, ISAs, etc.
The business financial services sector is more difficult to predict and has been in a state of change since 2008 when economies started to go into recession. I fully expect the innovative that is currently happening on the fringes of business funding, such as equity crowdfunding and peer-to-peer lending, to change the business finance landscape. They will become mainstream choices for business investment and widely accepted as a common source of finance rather than being tagged as “alternative”.
Can businesses in your sector/industry access the finance they need to grow? If not, what can be done to improve things?
That’s precisely the challenge that Crowdcube is here to solve!
How would others describe your leadership style?
When Darren Westlake and I set out to create our service we planned to help entrepreneurs raise finance and allow ordinary people invest in UK businesses. Such has been the disruptive nature of the Crowdcube model that we inadvertently found ourselves leading a revolution within the financial services industry with other transformational organisations that are changing people’s perceptions of how to raise business finance. It is nice to think that we are the pioneers ploughing the first furrow that many others will follow in the years to come. Being first isn’t easy, but it is one hell of an exciting journey!
Your biggest personal extravagance?
After finishing university I took a six month contract to become an English language teacher in China. This sabbatical (a.k.a. strategy to avoid getting a proper job) eventually lasted more like 18 months and took me on a journey around Indo-China. I loved every minute of it and wouldn’t change it for anything!
We’ll be discussing the future of crowdfunding in detail at Real Business Funding, the free conference to illuminate the new, more plural funding environment for growing SMEs. Join us on March 15, 2013, at the British Library, and join the discussion on Twitter at #unleashingfinance.
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