Republic Europe, formerly Seedrs, posted its group accounts on Companies House last week. The online investment platform reported a larger loss for 2023 than for 2022. Republic (Open Deal), based in the US, is one of the largest investment crowdfunding platforms in the world. In the last couple of years, the world has seen a battered economy, slowing VC investment, and a health crisis. It is not hat surprising that Republic Europe experienced a downturn in activity.
For the year ending December 2023, Republic Europe’s top-line revenue declined by 10% from £6,891,524 in 2022 to £6,198,869.
Correspondingly, the operating loss for 2023 was booked at £10,642,980 versus £7,993,767 in 2022. The net loss for 2023 was reported at £9.16 million. Wages and salaries are the vast majority of its expenses.
The Group is said to have received £ 7.4 million in equity capital injections in 2023. The company reported £8.4 million in funding in 2022. In February 2024, Republic Europe received an additional £2 million from the parent company. This new money is expected to keep the platform going for at least another 12 months.
To quote the report:
The decline in the Group’s revenue was driven by a combination of lower deal and investment volume, resulting in a decrease in investor revenues. The loss for the year and resulting net profit margin, however, is in greater part owing to the increased investment into both core business operations and development of growth initiatives, particularly in view of opportunities created by the acquisition.
Republic announced the purchase of Seedrs in late 2021. The deal closed in 2022 for around $100 million.
In recent months, Seedrs rebranded to Republic Europe, taking on the owners’ brand.
The Strategic Report by Republic Europe states:
Online investment in alternative asset classes is growing as an industry in the long-term and continues to receive attention and support from the media, public and government. Whilst there is competition, the Group is confident that its commitment to developing a strong brand, state-of-the-art infrastructure, and product development through research and development, an extensive customer base, and quality service will mean it remains a market leader.
In September 2022, the Group was acquired by OpenDeal Inc., which operates a leading U.S.-based platform for investing in private assets. Leveraging their operating expertise ni each geographical area, the Republic group seeks to create the first global private investment platform and as such reinforce the wider democratisation of finance. As a result, Republic has and is expected to continue committing additional capital to the Group to invest in research and development, allowing for future growth and expansion.
Most investment crowdfunding platforms have yet to turn a profit. The recent exception is Wefunder, which reported a profit for the first half of 2024. The company also has a presence in Europe.
