Revolut: A Big Win for Early Investors on Crowdfunding Platforms

Revolut revealed its most recent funding round today as it raised $250 million at a valuation of $1.7 billion. In many ways, the success of Revolut is emblematic of the power and potential of investment crowdfunding. Until today’s Series C round, each successive funding round was paired with a crowdfunding offer enabling smaller investors to participate in a promising young firm.

Revolut first raised capital on Crowdcube in July of 2016 at a valuation of a mere £42 million ($58 million). All early stage investing is risky, and everyone advocates a diversified portfolio, but for crowdfunding investors participating in this first round – and subsequent offers – they have seen the value of their investment rise.

“Revolut is a crowdfunded Unicorn – this is a watershed moment for the finance sector and exactly why Crowdcube was started; to give anyone the chance to invest in the next big thing,” said Luke Lang, co-founder of Crowdcube. “Back in 2016, just a year after the company was launched, investors on Crowdcube backed Revolut alongside some of Europe’s leading venture capital firms. Now, just two years later, Revolut’s valuation has jumped from $58 million to $1.7 billion, so those stakes are worth significantly more.”

This is the Model

Pairing professional investors, such as big VCs, alongside crowd investors is a viable path for crowdfunding platforms.  With a professional investor participating, smaller investors may be more confident in the vetting of the company as well as the valuation of the investment opportunity. In the case of Revolut, smaller investors hitched a ride along with big VCs with a company that appears to be on a path of a public offer at some point in the future. Time will tell.

For Seedrs, the other securities crowdfunding platform that helped Revolut accomplish its funding needs, Revolut is the poster child for what they are trying to accomplish.  Seedrs CEO Jeff Kelisky recently told CI that each funding round has been met with intense investor demand.

“We are absolutely delighted that Seedrs alumni, Revolut, has just become a UK unicorn,” said Kelisky. “This is a testament to their proposition, excellence in execution, and impressive growth since their round on Seedrs last year, which broke numerous crowdfunding records. Revolut has been one of the highest traded companies on the Seedrs Secondary Market and now it’s even more exciting that our investors will be able to trade Revolut shares at 3.6x their investment in less that seven months.”

In the UK, expect to see more investment opportunities pairing pros with retail investors on crowdfunding platforms as the industry continues to mature.

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