“We are on a mission to democratise the venture capital investment business”
In a pivotal offer, VC firm Venrex will raise £ 1 million in capital on equity crowdfunding platform Seedrs allowing ordinary investors to join an investment fund that is typically reserved for the wealthy elite.
Venture capital is traditionally a high net worth game. You have a lot of money and you are willing to shoulder some risk for the shot of an outsized gain. In Silicon Valley these days it is all about the elusive Unicorn: The startup with the potential and trajectory to quickly launch it to a valuation of over $1 billion. A lot of money is made by successful VC’s but for most retail investors the opportunity has been blocked. With the advent of crowdfunding this is all changing as barriers are being brought down and investment opportunity is being democratized.
Venrex, a London based group, claims a solid 12 year track record of making early stage investments in companies like Just-Eat, Chilango, Lyst, and more. Like other VC firms, they focus on deals where they envision a 10X return. In the past years, Venex has managed £26 million in 6 funds that have invested in 54 companies. Venex estimates the net unrealized returns have a present valuation of £59.5 million or an IRR of 20% calculated over the past 12 years.
Venex is led by Tom Fleming, a professional investor who is on a mission to change finance. While some VCs have groaned about equity crowdfunding and “bloated cap-tables” – the reality will be quite different. Fleming is thoughtful enough to have realized this fact.
“We are on a mission to democratise the venture capital investment business and make exciting early-stage investment opportunities available to a much wider investment audience, says Fleming.
He continues to explain his choice in partnering with Seedrs as one that “protects investors rights”. Fleming also acknowledges that having new investors that become determined “evangelists” for companies – can be a powerful force.
“One of the biggest benefits of crowdfunding is that it opens up investment opportunities to a much broader audience than just ultra high net worth or institutional investors, breaking down traditional barriers within the venture capital industry,” states Lynn. “Tom and his team have a fantastic reputation in the marketplace for spotting the potential winners amongst early-stage startups and we are pleased to partner with Venrex on this new opportunity to enable crowd investors to access its next portfolio of highly curated companies.”
— Tom Fleming (@flemingventures) July 7, 2015
The Venex raise is foreshadowing what will inevitably become commonplace. Early stage opportunities must be made an investment option available to all. Pairing pros with ordinary investors has gained traction and fans across the crowdfunding space and the Seedrs partnership with Venrex is a perfect example of this phenomena.
The Venrex II Fund, which is live on Seedrs now, has quickly topped £500,000 as over 120 investors have quickly jumped in.
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