Equity platform Crowdcube hails £8.5m investment as ‘proof of progress and potential’

Crowdcube has secured a £8.5m investment to accelerate growth and continue its drive towards profitability.

Venture capital firm Draper Esprit, which led the round by acquiring a £6m stake, invested alongside Balderton Capital and Channel 4, which backed the equity crowdfunding platform through its Commercial Growth Fund.

Members of the public will have the chance to invest in Crowdcube when it launches a crowdfunding campaign next week (November 14) to supplement the institutional investment.

Crowdcube achieved record revenues in Q3 2018, with sales growing 60% year on year to £1.6m. During the same three-month period, investment pledged through the platform rose 97% to £50.4m.

The company is now forecasting an annual revenue of £6m in 2018, compared with £3.9m last year and £3.6m in 2016.

As part of its growth plans, Crowdcube will look to continue attracting campaigns from businesses based in Europe and the US.

Through its UK and Spanish operation, and its partnership with American crowdfunder SeedInvest, over 90 overseas companies have successfully raised on Crowdcube, accounting for 18% of successful campaigns during H1 2018.

Crowdcube’s co-founder and CEO, Darren Westlake, said: “We’ve transformed equity finance and funded more businesses than anyone else in the UK to become a preferred choice for British entrepreneurs.

“This latest investment, from two highly-regarded venture capital investors who are significantly increasing their stakes in Crowdcube and a famously forward-thinking media company, is fantastic proof of our progress and potential.”

He continued: “It will enable us to accelerate our journey to profitability and expand faster in the UK and overseas, so we can help more innovative and ambitious businesses from across the globe grow, expand and make a difference to the world.”

Simon Cook, CEO of London-headquartered Draper Esprit, commented: “Crowdcube has demonstrated significant progress and impressive growth in the last 12 months.

“They have a proven and scalable platform, seven years of unrivalled experience, strong brand awareness and a clear market opportunity in the UK and abroad. They are the world’s leaders in equity crowdfunding, and I expect them to continue blazing a trail of innovation and success.”

Jonathan Allan, chief commercial officer at Channel 4, said: “Crowdcube is the perfect fit for Channel 4’s Commercial Growth Fund investment.

“We both share a desire to support emerging talent and disrupt the status quo. This innovative business is powering the next generation of brilliant entrepreneurs all across the country and energising the investors who want to back them.”

Suranga Chandratillake, partner at Balderton Capital, said: “Crowdcube has continued to demonstrate great progress and growth in the last 12 months and we’re pleased to be supporting the company alongside Channel 4 and Crowdcube’s global investor community.

“In the last seven years, Crowdcube has built a scalable platform and is the world leader in equity crowdfunding. We look forward to being partners on the journey ahead.”

According to the independent researcher Beauhurst, Crowdcube has funded more equity raises in the UK than any other equity funder since it launched in 2011.

In September Crowdcube announced that it has facilitated more than 100 raises of £1m or more to date, including campaigns for high-growth companies like challenger bank Monzo and travel brand Mr & Mrs Smith.