Crowdcube, the UK’s largest equity crowdfunding platform, and US based SeedInvest have officially announced a formal arrangement to provide cross border investment crowdfunding. The deal was tipped a few days ago when Keen Home, an American company that is crowdfunding on SeedInvest – popped up on Crowdcube. The combo UK – US offering now stands at over £2.8 for an equity stake in a firm valued at more than £11 million.
Crowdcube said the move was designed give UK investors access to American companies being funded on the SeedInvest platform. This is the first time a UK crowdfunding platform has partnered up with an American counterpart in this way.
Darren Westlake, co-founder and CEO of Crowdcube, said he was thrilled to be partnering with SeedInvest – a leading investment crowdfunding platform in the US. He noted that Keen Home’s existing investors are high profile VCs including Techstars Ventures, Galvanize Ventures, R/GA Ventures, American Family Ventures and Lowe’s Ventures. US Shark Tank star Robert Herjavec has also backed the firm adding some small screen glitz to the company.
Keen Home has reportedly sold over 35,800 Smart Vents and grossed over $2.6 million in revenue since launching the product in November 2015. The Smart Vent System controls a home’s heating and cooling airflow on a room-by-room level, which studies show results in improved comfort and efficiency. The company has strategic partnerships with Google’s Nest and Samsung’s SmartThings and has raised more than $4.4 million in financing from VCs.
“Through this unique partnership with SeedInvest, the investment opportunities for investors on Crowdcube are more diverse than ever before,” said Westlake.
Ryan Feit, co-founder of SeedInvest, explained that the crowdfunding industry is all about breaking down borders. And why not? As long as the platforms list quality issuers that are compliant in both jurisdictions, it just makes sense.
Feit said that SeedInvest has taken the lead in opening up investment opportunities in startups to many more people than was previously the case.
“It makes sense that the fast-growing companies on SeedInvest’s platform should be able to reach out beyond America for funding as they grow their businesses and build their brands,” explained Feit. “We’re delighted to be helping Keen Home access crowd investment from the UK with the help of Crowdcube, our fellow-pioneers in equity crowdfunding.”
Neither platform indicated as to how far the partnership will scale and what type of issuers will be co-listed. Crowdcube has already been highly active crowdfunding in continental Europe. SeedInvest may gain by allowing pan-European investors to participate in offers. Not just the Brits.
Additionally, it is not clear if Crowdcube will be looking to post offerings on SeedInvest. The cost for a UK issuer to do a Reg A+ crowdfunding campaign is prohibitive. A Reg CF offer is arbitrarily capped far too low at $1.07 million. A Reg D offer, the most robust sector of US equity crowdfunding that caters to Accredited investors only, is an option and may make sense going forward. For now, let’s see how the relationship grows.
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