Kiwi investment crowdfunding platform Snowball Effect has shared their annual update and according to the investment platform – it has been a banner year.
Snowball Effect reports that it has raised more capital than any previous year and continues to grow steadily. Snowball Effect believes that the private capital markets in New Zealand can benefit from being as transparent as possible and the platform has recently partnered with the University of Auckland and University of Minnesota to uncover insights into investor behaviour and the growth in online capital raising around the world. By sharing their experience, Snowball Effect helps to shed light on the evolving online investment industry.
Below are some of the highlights from the past year:
Larger offers
- Snowball Effect has now raised $41.8 million in capital across 54 offers. The private capital part of the business continues to grow with $12.7 million raised privately in 23 offers. The average size of offers that we work with has been increasing and 13 offers have been over $1 million in size. We have completed 22 offers that attracted more than 100 investors.
Growing investor base
- Snowball Effect’s investor audience now includes 17,700 people, of whom 7,300 have actively indicated interest in investing in a particular offer. They have found that each indication of interest averages out to about $1,000 in investment in the final offer per indication of interest. One of the most important metrics for a two-sided marketplace business is “transacted users”. In their case, 3,100 people have made a completed investment on the platform.
Larger investors
- They are now working frequently with large family offices, institutional, and sophisticated investors. 810 people have invested more than $10,000 through the platform and 67 people have invested more than $100K through the platform. There are now 1,400 wholesale investors on Snowball Effect who are eligible to receive private offers. $27.7 million in transaction volume has come from people investing more than $10K.
Increasing diversification
- A key difference between Snowball Effect and other players in the online investing space is that they want investors to take the private company asset class seriously as part of their overall investment portfolio. To that end, they are pleased to see that 33% of their investors have now invested in more than one offer and 14% have invested in three or more offers. 30 people have invested in 10 or more offers (which research from the Kaufman Foundation shows is the base level of diversification needed to approach the underlying asset class returns for angel and venture capital investing). The most active investor on Snowball Effect has now invested in 27 offers.
Ongoing services
- Snowball Effect’s ancillary services have continued to grow with 14 companies now tracking their legal share ownership records in the Snowball Effect share registry. These companies represent 2,059 shareholding records. They also now have 163 director profiles from investors that are available as independent directors for companies that raise capital through Snowball Effect.
Snowball Effect has provided an infographic on their platforms results for the last four years.
