In a Tweet last Friday, Seedrs reported a big investment day for the platform where Passion Capital raised “over £2 million” in a couple of hours and MacRebur raised £1.6 million on Thursday. Seedrs said the first quarter of 2021 had been great.
The comments on robust funding were joined with a bit of shade thrown at the UK Competition and Markets Authority (CMA) which appeared to compare the agency to a monolithic ship blocking a canal somewhat similar to the Suez canal debacle.
Well…what a week that was!
🚀@passioncapital raised over £2m in a matter of hours
🛣@MacRebur raised over £1.6m (and counting) from more than 1,200 investors
💰Yesterday was our biggest day for investment this year (it’s been a great Q1!)
And…there was some merger news… pic.twitter.com/qibpGgKNck
— Seedrs (@Seedrs) March 26, 2021
It was reported last week that the CMA’s provisional decision to block the merger between Seedrs and Crowdcube had compelled Seedrs to end the process. In a blog post, Seedrs co-founder and Chairman Jeff Lynn stated they “fervently” disagree with the CMA but they were well prepared for this possibility. You can expect more news to follow soon including details on a funding round.
In referencing the partnership with Passion Capital, Seedrs was highlighting an interesting securities offering raising capital on its platform. Passion Capital is an early-stage tech VC firm. Investors on the Seedrs platform have the opportunity to invest in a £45 million fund. Seedrs said that this partnership is the first time a Europe-based private VC fund is opening up to crowd investors.
In a blog post, Passion Capital explained their thought process in working with Seedrs:
“Overall, we saw all of these factors democratising access to venture funds and breaking down barriers to what was historically out of reach for everyday investors. With new platforms, structures and approaches, we felt this was all immensely positive and not only wanted to take part in it, but wanted to see if we could help push the trend even further. Our remaining warehoused allocation seemed to be an ideal opportunity to experiment and try this out. We’re overwhelmed and truly invigorated by the positive response. We’re really hoping to validate the notion of having the Seedrs nominee as an LP to a much larger degree in our next Passion Capital fund (Fund IV), and we’d also love to see other GPs and funds doing the same thing in their funds. After the announcement, we were contacted by a number of other funds who said they’d been trying to think of ways to do similar, so we’re thrilled that there might be more of this to come.”
While the decision by the CMA to block the merger may be disappointing for both firms (and perhaps their investors), Seedrs appears to be gearing up to more effectively compete with the global crowdfunding industry and other investment options. By listing shares in a venture fund, investors may gain access to high-quality, vetted deals in a diversified securities offering. The fact that other VCs may be interested in doing the same should be a win for both investors as well as early-stage ventures in need of capital.