Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Equity Crowdfunding, Alternative Funding
£1.2m raised in 16 minutes? That’ll be a world record
The Telegraph | By Rebecca Burn-Callander | July 22, 2014
Crowdcube, the equity-based crowdfunding platform, has broken the world record for the fastest fundraising after taking just 16 minutes to hit its target.
In a world first, Crowdcube, which raises funds from armchair investors in exchange for equity, today closed a £1.2m round within just 16 minutes.
This was 12 times faster than the previous record for the fastest crowdfunded pitch and set a world record for the fastest equity crowdfunding raise of all time.
View:
The previous record for the fastest equity crowdfund was Crowdfunder, a Cornwall-based crowdfunding platform focusing on rewards, which raised £500,000 in three hours.
Darren Westlake, Crowdcube CEO and co-founder said: “This is the first time that any sizeable fundraise has meshed traditional and alternative finance methods and we expect to see more of this in the future.
141 investors backed Crowdcube’s latest round of crowdfunding, which will be used to expand the company's operations both in the UK and internationally.
The average amount invested topped £8,500.
This latest round follows a £3.8m cash injection from venture capital firm Balderton Capital last week.
The company, which now has a presence in seven countries, including Brazil, Sweden, Dubai, Poland, Italy, Spain and New Zealand, is hoping to build a truly global crowdfunding platform.
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Combination Creates A Leader In Crowdfunding Market
Forbes | By Devin Thorpe | July 21, 2014
RockThePost, an accredited investor crowdfunding portal announced this morning its merger with CoFoundersLab, an online and in-person matchmaking network that scientifically builds startup teams, creating a platform with 35,000 startup founders and 15,000 accredited investors where entrepreneurs have raised over more than $65 million. The combined company will be called Onevest.
Related: Accredited investor crowdfunding in Canada
Shahab Kaviani, CEO of CoFoundersLab and CMO at Onevest, explained the motivations for the merger, saying, “Over the last few years, CoFoundersLab’s mission has been to help entrepreneurs succeed. Once we were able to find a scalable way to bring more compatible teams together we began asking our community of founders what their next big challenge was. With an overwhelming response they shared that access to capital was the biggest need they have, particularly for teams located outside the major startup hubs like Silicon Valley and New York.”
He went on to explain that the team was intrigued by crowdfunding and was considering adding crowdfunding to the business model. Before doing so, they decided to raise their own seed round that way.
Kaviani added, “My research of the industry players led me to choose Onevest (formerly RockThePost) where we were able to meet and close a number of investors that we otherwise would have never met. This was a real eye opener for me and I thought to myself, this equity crowdfunding really works—in fact it is a total game changer for entrepreneurs.”
View: Canadian Crowdfunding Directory
“After having success raising funds on Onevest it became clear to me that we must pursue this avenue and quickly realized that a partnership with Onevest would be meaningful on a number of levels. Once we learned more about both of our team’s synergies, culture, and broader solution, a merger was blatantly obvious,” Kaviani concluded.
“The best way to ensure that two cultures combine successfully is to validate they are compatible from the onset, making this a material consideration and condition for a deal to close,” noted Tanya Prive, former COO and founder of RockThePost and COO and Founder of OneVest (and Forbes.com contributor). “The culture of both teams is absolutely aligned and complementary so we don’t anticipate any issues. Our weaknesses are their strengths and vice versa, so it really couldn’t have worked out any better.”
Equity crowdfunding is just now in its infancy. The JOBS Act, passed in 2012, created the industry, only rules for accredited investor crowdfunding have been issued in final form by the Securities and Exchange Commission. The SEC later published draft rules for crowdfunding from ordinary investors and accepted comments on them for 90 days. Final rules have not yet been promulgated.
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The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada crowdfunding hub providing education, advocacy and networking opportunities in the rapidly evolving crowdfunding industry. NCFA Canada is a community-based, membership-driven entity that was formed at the grass roots level to fill a national need in the market place. Join our growing network of industry stakeholders, fundraisers and investors. Increase your organization’s profile and gain access to a dynamic group of industry front runners. Learn more About Us or contact us at casano@ncfacanada.org.
NCFA Hosts Crowdlending Panel Discussion with InvestNextDoor and Grow Financial
NCFA Canada About Us | Gabe Nasr | July 18, 2014
What is Crowdlending?
Crowdlending is a debt-based crowdfunding model and form of alternative finance sometimes referred to as P2P lending or P2B)with great potential for both economic and social impact. On July 17, 2014, Gabe Nasr (moderator) recorded a google hangout with two of the crowdlending leaders in the space (who both happen to be based in BC).
Loans are arranged efficiently and cost effectively directly between borrowers and lenders with transactions being facilitated through the use of an online marketplace such as Grow Financial (formerly Grouplend) and InvestNextDoor.
Crowdlending portals connect borrowers and lenders directly giving investors (lenders) the opportunity to lend money (usually for short term periods) to borrowers they connect with online who turn around and repay the loan principle plus interest.
The loans given through crowdlending portals are paid back without the involvement with a traditional financial intermediary such as the bank, so the rate of return is more profitable for an lender, and beneficial for the borrower. Crowdlending makes the process of loaning more cost-efficient and use-efficient.
Google Hangout Panel participants included:
Tabitha Creighton, CEO and co-founder of InvestNextDoor, a crowdlending marketplace for small businesses to borrow from investors in their communities.
Kevin Sandhu, CEO of Grow Financial (formerly Grouplend), a Canadian peer to peer (P2P) lending portal.
Watch the Hangout Now
What’s so Great About crowlending for businesses?
- Crowdlending portals allow borrowers and lenders to have a direct relationship, and orients the money exchanged to the local area it is put in. In our online panel discussion, InvestNextDoor showed their fresh perspective on investing
- When a Crowdlending investor (rather than a remote investor or bank) puts his/her money into a local business through InvestNextDoor, the money stays within that community, which translates to a redistribution pattern that triples the initial investment (this is something Tabitha talks about in our panel discussion). InvestNextDoor is tracking this trend in their Social Impact Index, which is launching soon. It ranks the relative social impact of the investments taking place on the portal.
Related: 8 considerations for successful debt-based crowdfunding (peer-t0-peer Lending)
Crowdlending also works for individuals seeking non-business loans
- GroupLend, which is a soon-to-be-operative consumer lending platform, caters to a market seeking socially responsible alternatives to credit cards.
- Effectively disintermediating the flow of money from investor to individual borrower makes for a more efficient, and reliable platform than the standard ones in place currently. In our conversation, Kevin talks about how there’s a huge economic and social benefit for both investor and borrower.
Final Word
Crowdlending is still in its beginning stages, so there are plenty of trials for these models to go through for them to become common and established ways to give and receive loans. However, as the current lending models show weaknesses (i.e., risk tolerance, cost of capital) and become antiquated, it is only natural that new models are being developed and in this case by the community that it services to help (novel idea!). By building off of the early success crowdlending has found in the US, Canada must put regulations in place which enable companies and individuals new financial tools to both borrow and lend capital on sites like GroupLend.
View the Crowdlending Panel Discussion --> Now
The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada crowdfunding hub providing education, advocacy and networking opportunities in the rapidly evolving crowdfunding industry. NCFA Canada is a community-based, membership-driven entity that was formed at the grass roots level to fill a national need in the market place. Join our growing network of industry stakeholders, fundraisers and investors. Increase your organization’s profile and gain access to a dynamic group of industry front runners. Learn more About Us or contact us at casano@ncfacanada.org.
OurCrowd crowdfunding investments hit $60 million
Startup Israel | | July 15, 2014
If there were ever doubts about the validity of the crowdfunding investment model, an announcement Tuesday by Israeli crowdfunding pioneer OurCrowd should put them to rest. The fund said it has raised $60 million since it was established 16 months ago — nearly $20 million of that in just the last four months. Those figures, said CEO Jon Medved, put OurCrowd far ahead in fundraising of any other crowdfunding firm anywhere.
FCA warns crowdfunding sites on social media use
Money Marketing | | July 14, 2014
The FCA has written to crowdfunding websites raising concerns they are not using the appropriate risk disclaimers when promoting their business on social media.
Equity crowdfunding allows small, private companies to raise money from online investors by selling stakes from £10.
The Times reports the regulator has told the sites to put risk warnings into every Twitter message or “tweet”. A start-up seeking funding using equity crowdfunding, industry comparison website The Crowdfunding Centre, and leading crowdfunding platforms Seedrs and Crowdcube are all understood to have received the warnings.
View: New FCA Crowdfunding Regulations Anger Start-up Industry
The FCA is concerned potential investors do not fully understand the risks of crowdfunding, including that most start-ups fail, equity stakes are difficult to sell and consumers may see shares diluted by future investors.
But the industry has told The Times that adding these risk warnings will hurt businesses’ ability to discuss funding rounds.
The Crowdfunding Centre founder Barry James told the newspaper: “Social media is the life-blood of crowdfunding. It ceases to be viable without it … There are full risk warnings once you click through [to a site], way before anyone can consider parting with any cash.”
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Crowdfunding vs. VC seed rounds: Which makes sense?
BetaBoston | Lee Hower | July 14, 2014
The rise of crowdfunding in the last three to five years as a source of capital has been remarkable. Tech startups and potential investors have had greater access to one another than ever before, and beyond the startup world, a broad array of projects have been able to successfully seek capital via crowdfunding.
But contrary to some speculation about the two overlapping in their uses, crowdfunding and VC seed funding can each be raised for distinctly different situations.
Navigating Crowdfunding Platforms
Before understanding which approach is right for your company, we need to first parse the crowdfunding universe a little bit, as people use this as a catch-all term encompassing a range of different activities across distinct ecosystems. To clarify some of the nuance:
View: Pebble and Glyph - How Crowdfunding is creating disruptive new products
Equity Crowdfunding - This is crowdfunding activity that comes directly in the form of investors buying equity (or convertible debt which is akin to equity) in startups themselves. Because of SEC rules on investing in private companies, this type of funding could only come from “accredited” investors who meet certain thresholds of wealth or income. The primary equity crowdfunding marketplace has been AngelList of course, though there are others like FundersClub. And once the specific rules of the JOBS Act take effect, you may see other platforms get involved in equity crowdfunding.
“Project” Marketplace Crowdfunding - This is crowdfunding for a wide range of projects ranging from creative endeavors (books, movies, bands, etc.) to inventions to non-profit organizations. Typical platforms include IndieGoGo, Kickstarter, Quirky, and more. Funders’ contributions are essentially donations (which is why this is sometimes referred to as “donation crowdfunding”) that don’t entitle them to a slice of ownership in the company raising the capital, but rather perks like recognition or pre-ordered products.
Vertical Crowdfunding - Similar to the broad crowdfunding marketplaces, we’ve been hearing about these industry-specific crowdfunding platforms more and more in the last 12-18 months. They target a particular vertical or type of business (e.g. CrowdStreet for real estate projects or Dragon Innovation for hardware/device companies).
So when does crowdfunding make sense for a tech startup?
Project or donation crowdfunding can make sense for startups building a consumer product, typically with at least some physical hardware component. There are now many examples of companies that raised non-dilutive capital for building early versions of their product via crowdfunding prior to raising VC capital — Oculus is perhaps the best known example because of their ultimate acquisition by Facebook. But SmartThings, OUYA, and other consumer product startups have taken a similar path.
View: Igniting Venture Capital in BC event attracts full house in Vancouver
Also, there are a lot of product inventions or businesses for which VC funding may not be a good fit, in which case crowdfunding may be a viable alternative for getting things off the ground. (For instance, perhaps the company won’t be venture scale and thus won’t attract that kind of funding.) The advantages of project crowdfunding can be the potential to raise a small amount of early capital quickly. In addition, project crowdfunding can be a useful way to identify and connect with early adopter customers who provide feedback and are loyal ambassadors for your brand.
But for those startups doing something other than a consumer product, project crowdfunding usually isn’t a viable path. And even those startups that do raise some capital through project crowdfunding often still seek a VC round either at the seed or Series A or B stages. Furthermore, while a few high profile successes raise hundreds of thousands or even millions in their campaigns, the average amount raised from a crowdfunding campaign is less than $10,ooo. So unless you have dramatically successful campaign, project crowdfunding won’t raise a substantial sum for your startup.
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Ten-step guide for successful equity crowdfunding
The Globe and Mail | Sandi Gilbert | July 11, 2014
Equity crowdfunding, where companies offer equity in return for financial investment, is a new and relatively unchartered means for raising capital in Canada. It’s an attractive proposition – businesses capture a wider market of potential funding and investors get access to more interesting investment opportunities.
At SeedUps.ca, Canada’s first equity-based crowd-finance platform, we’re fielding hundreds of requests from startups and small businesses looking for a new way to raise money. While the crowd can be a powerful resource, there are also certain steps that a small business must undertake to raise capital:
1. Understand the basics. The term crowdfunding is tossed around, usually in reference to ‘contribution-based’ crowdfunding platforms like Indiegogo or Kickstarter where donors give money to support an idea they believe in and get a reward, perk or prototype in return. Equity-based crowdfunding, however, is where investors have the opportunity to invest in a business and receive equity. In other words, it’s about being an owner versus a donor.
2. Can you raise capital from the crowd? Not all companies are suited to raising capital via equity crowdfunding. You need a strong social following and a compelling story that is easily told through social media and video. Investors typically invest in companies they are interested in or have products or services they want to buy.
View: Woody Harrelson's tree free paper company decides to use equity crowdfunding through optimize capital markets to raise $5MM as opposed to traditional sources of finance
3. Structure your capital raise. Create a three-year plan to determine your company’s capital requirements over the near term. How much money do you need to raise and should it be a combination of debt and equity. Surround yourself with advisors that can help you navigate through your options.
4. Get your house in order. Many small businesses interested in raising capital are unprepared. The crowdfunding platform and potential investors will ask tough questions about your business model. Get your minute book, corporate records, financial statements and other corporate governance records in order.
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The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada crowdfunding hub providing education, advocacy and networking opportunities in the rapidly evolving crowdfunding industry. NCFA Canada is a community-based, membership-driven entity that was formed at the grass roots level to fill a national need in the market place. Join our growing network of industry stakeholders, fundraisers and investors. Increase your organization’s profile and gain access to a dynamic group of industry front runners. Learn more About Us or contact us at casano@ncfacanada.org.
